This study's main objective is to examine the mediating effect of accounting practices between AIS in ERP environment and firm performance of listed companies in Sri Lanka. AIS has two main dimensions, such as ERP System Quality and Accounting information Quality(ACIQ). The total population of the study consist of 295 companies. A random sampling method was applied, and 217 companies were used as a sample for this study. Amos 23 version was used as an instrument to analyze the data, and the structural equation model was applied to test the path relationship of the constructs. The study shows that ERP system quality and ACIQ have a statistically significant influence with Accounting practices and firm performance, while accounting practices have a significant influence with firm performance. In addition to this, accounting practices have a significant mediating effect between AIS and firm performance. IS managers and accounting professionals can use the finding and also should pay more attention to improve ERP System Quality and ACIQ in order to enhance Accounting Practices which subsequently having implication on firm performance. AIS quality and organizational performance will also be enhanced when new AIS applications and capabilities are brought in, as per the resource-based view.