The article discusses the main directions of modernization of accounting in the digital economy and the information society.
International Journal of Management (IJM) Volume 11, Issue 2, February 2020, pp 122–131, Article ID: IJM_11_02_013 Available online at http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=11&IType=2 Journal Impact Factor (2020): 10.1471 (Calculated by GISI) www.jifactor.com ISSN Print: 0976-6502 and ISSN Online: 0976-6510 © IAEME Publication Scopus Indexed INFORMATION SYSTEMS AND TECHNOLOGIES IN ACCOUNTING AND TAXATION AS A MEANS OF INTEGRATION INTO THE DIGITAL ECONOMY Yaroslav Izmailov Department of Tax Policy, University of the State Fiscal Service of Ukraine, Irpin city in Kiev Region, Ukraine Dmytro Pilevych Department of Management Accounting, Business Analytics and Statistics, University of the State Fiscal Service of Ukraine, Irpin city in Kiev Region, Ukraine Liubov Shevtsiv Department of Accounting and Auditing, Ivan Franko National University of Lviv, Lviv, Ukraine Yuliia Petlenko Department of Finance, Taras Shevchenko National University of Kyiv, Kyiv, Ukraine Olha Driha Department of accounting and audit, National Technical University Dnipro Polytechnic, Dnipro, Ukraine Antonina Lagun Department of International accounting and auditing, Vadym Hetman Kyiv National Economic University, Kyiv, Ukraine ABSTRACT In the context of the transition from an industrial society to an information society and the formation of a knowledge economy based on the intensive development of digital technologies, prerequisites have emerged for the emergence of a new neoeconomics information environment with a predominance of intangible value creation factors, new business processes and social and humanistic priorities Such changes certainly affect the entire system of information support of socio-economic processes, in which accounting, with its functionality for collecting, processing and providing http://www.iaeme.com/IJM/index.asp 122 editor@iaeme.com Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun economic information on the activities of business entities, plays a traditionally significant role The article discusses the main directions of modernization of accounting in the digital economy and the information society In particular, an assessment is given of the theoretical premises, and the possibility of changing the accounting paradigm, the development of the accounting concept and its elements, the issues of structuring the accounting system by types of accounting are considered, the criteria for their selection and development trends are determined The key factors of the influence of digital technologies on the methodology and methods of accounting are identified, the possibilities of their expansion and modernization are determined Also in the context of the development of hybrid and intangible forms of capital, the virtualization of monetary and non-monetary units of value, the expansion of non-financial target characteristics of economic entities, the main trends in the development of accounting objects, criteria for their recognition and metrics are determined Keywords: Accounting, Digital Economy, Information Systems, Integration, Taxation, Technologies, Transactions Cite this Article: Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun, Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy, International Journal of Management (IJM), 11 (2), 2020, pp 122–131 http://www.iaeme.com/IJM/issues.asp?JType=IJM&VType=11&IType=2 INTRODUCTION Global changes in the role of information as a factor in social life have identified the transition to the information society and the formation of a digital economy, which are characterized by humanitarian priorities, the dematerialization of value creation factors and the transformation of the information environment for supporting business models and ecosystems, as the main trend in social and economic development One of the trend areas in this context is the development of the digital economy [1-3] Such changes affect the entire system of information support for socio-economic processes, in which accounting has traditionally played a significant role with its functionality for collecting, processing and providing economic information on the activities of business entities [4-5] It may be said that materialism has made people focus only on money and money-making, as a result eradicating the spiritual values Due to this deterioration of spiritual values, people are dispirited, stressed and lack concern for fellowmen This has led to a decline in work performance at the individual level Spiritual intelligence may address this fundamental challenge currently faced by a business Accordingly, issues of rethinking the role and place of accounting in the information, including the digital economy, the study of changes in its substantial, methodological and conceptual foundations under the influence of the technological and digitalization capabilities and requirements for information content are becoming relevant [6-7] The relevance of research in this area is also due to the fact that in recent decades problems have been identified associated with a decrease in the functionality of accounting and the usefulness of reporting information for a number of stakeholders, which predetermined numerous studies devoted, at a fundamental level, to revisions of his theory, concepts and paradigms, analysis Roles in the formation of the information environment for http://www.iaeme.com/IJM/index.asp 123 editor@iaeme.com Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy managing economic processes, and at a practical level - the search for specific ways of updating accounting and increasing relevance ty of his information METHODOLOGY AND OBJECTIVES OF THE STUDY The feasibility of developing a new concept, theoretical principles and practical recommendations for the modernization of accounting is determined by a number of factors: the allocation of information and as a key factor in creating value, a guide to non-financial target priorities, the development of hybrid and intangible forms of capital, the formation of a global digital environment, the virtualization of value units, assets, liabilities and related transactions (Fig 1) Figure The main factors affecting the development of accounting in the digital economy These factors have a significant impact on the accounting methodology, principles, procedures, content orientation and characteristics of the information product, internal structuring and allocation of types and clusters of accounting, definition and systematization of accounting objects, development of criteria for their identification and taxonomy, metrics and descriptors The construction of a conceptual model of accounting, which includes a set of theoretical developments that determine the logic, structure and principles of the functioning of the accounting system in the digital economy, seems to be a priority In particular, it is advisable: carry out the positioning of accounting and its components in the information environment of the global ecosystem, to evaluate its capabilities for solving a new level of socio-economic problems; analyze the impact of the digital economy on the paradigm, concepts, objects, methodology, structuring and organization of accounting; identify the possibilities and directions of modernization of accounting in the conditions of capitalization of knowledge and other intangible factors of economic and social growth, digitalization of socio-economic processes, the development of crypto economics and smart society, virtualization of economic relations and value objects; develop some essential regulatory documents defining the methodological and methodological foundations of accounting and its infrastructure support in the digital economy The theoretical basis of the research is the methodology and general scientific principles of conducting complex research, which include empirical - observation, comparison, http://www.iaeme.com/IJM/index.asp 124 editor@iaeme.com Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun description, measurement, experimentation, theoretical and cognitive - formalization, axiomatic method, hypothesis and hypothesis testing, hypothetical-deductive method, climbing from abstract to concrete and general logical - analysis and synthesis, scientific abstraction, generalization, idealization, induction and deduction, analogy, descriptive and analogue model education, systematic approach, structural-functional, probabilistic-statistical, comparative legal methods The intensification of scientific research in the field of development of accounting as a science and a form of practical activity that meets the requirements of the modern economic environment is confirmed by a significant number of developments defined by scientists as paradigms, theories, concepts and types of accounting The formation of a new conceptual accounting model requires an integrated approach, which is ensured by the implementation of a number of interconnected elements presented in Fig Figure Scheme of a conceptual accounting model formation in a digital economy The modern accounting paradigm can be defined as digraphic (in other systemic terms economical and dynamic) Assuming that the double-entry is the basis of the current paradigm and has not exhausted itself as its methodological basis, it is more reasonable to consider that so far we are talking more about research approaches and methods within the framework of the existing digraphic paradigm Today's digital technologies, for example, blockchain, are already interpreted as a prerequisite for a revolution in accounting methods, accounting registration systems Instead of generating and locally storing individual transaction records, enterprises will be able to write them into a unified register, creating a distributed and interconnected network of reliable accounting information Since all records are distributed and cryptographically protected, their falsification or destruction becomes almost impossible Bitcoin Magazine calls this a triple account This is not about changing the digraphic record to unigraphic, triple, quadruple, etc., but about the method of registering and storing the database of economic facts, which can be developed into a database of generalized data, financial and non-financial reports and filters of their reliability, a communication tool and ensuring the functioning of the global information economic environment An example is the development of management accounting, which is much more mobile in the methodological plan, which not only relies on traditional accounting methods but also http://www.iaeme.com/IJM/index.asp 125 editor@iaeme.com Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy actively adopts the methods of related areas of management activity - planning, analysis, forecasting, modelling, etc The elements of the method not become legally defined procedural components, but a multivariate management tool, in particular: the assessment can be carried out using various approaches (for example, at investment, market, insurance, book value, liquidation value) and multiple units of measurement; calculation can be carried out using a wide variety of techniques, and in management accounting allows you to determine different costs for different purposes; it is possible to use or not use accounts and double entries; the fact, the frequency of preparation and the content of the balance sheet and reporting are determined by the principle of profitability; it is advisable to compile forecast, segmental balances, iterative methods for its construction The formation of the information environment of the digital economy has an impact on the development of all the basic elements of the accounting method Accounting objects in the information society and digital economy are also undergoing significant changes First of all, this is due to the fact that there is a gradual expansion for the reporting users of a range of indicators characterizing not only economic efficiency, but also environmental safety, social responsibility of the business, strategic orientation, systematic and quality corporate governance, the presence of organizational, innovative, human, reputational capital and other non-financial objects that provide the basis for value creation In Fig presents new types of non-financial accounting objects in the information economy Figure New types of accounting objects in the information economy Besides, the range of objects is expanding due to new, hybrid and modifiable forms of assets, liabilities and capital Reflecting them in accounting does not just require the addition of existing methods, but the formation of new principles for the systematization and taxonomy of accounting objects, identification of criteria for their recognition, metrics, descriptors and principles of reflection in the system of economic information Also, it is essential to internal structuring of accounting and the allocation of its new types - those that are in demand and objectively existing Pronounced trends in this area are the convergence of existing models of accounting and attempt to identify new ones, such as strategic, adaptive, multi-purpose, creative, intellectual, etc http://www.iaeme.com/IJM/index.asp 126 editor@iaeme.com Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun One of the essential parts of the accounting system is the information component of two subsystems - financial and management accounting A reorientation from a control function to an informative one is noted, based on the organization of digital transformation points of an enterprise At the same time, IT-technologies cause significant modifications both in the methodology and in the applied direction of accounting science (Fig 4) Figure New types of accounting objects in the information economy 2.1 Directions of Development of Accounting Methodology Of particular note is the study of the possibilities of evaluating new accounting facilities, which are human intellectual capital, customer base, innovative products, R&D results, etc There is an inclusion in the accounting system of non-financial information (the quality of the client base, the state or implementation of social responsibility, the presence of economic security risks, the degree of application of energy-saving technologies, etc.) Modern developments of new information technologies, such as cloud technologies, open technology platforms, electronic reference and information systems, the creation of a single international format and content of financial statements in electronic form XBRL, are taking place 2.2 Accounting Automation Software in the Digital Economy To date, the stage of development of information technology allows you to fully appreciate all the advantages and all the importance of automation of accounting in organizations of various sizes and areas of activity To solve the difficult tasks of a company of various kinds and specifics, it is enough just to choose the right software and study the process of its use Indeed, on the part of business processes, all organizations are not much different from each other, which enables developers to create universal programs In addition to financial management, the accounting program can and should more to optimize other business processes related to the company's operations Payroll, inventory, cost tracking - these are just some of the most critical tasks in which the accounting system should be integrated Based on this, we compare the three most popular accounting systems of 2019 (according to FinancesOnline - Best Accounting Software 2019 Award): FreshBooks; http://www.iaeme.com/IJM/index.asp 127 editor@iaeme.com Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy NetSuite ERP; Sage 50cloud Each of these programs has its advantages, and the essence of the comparison takes into account the main features of accounting 2.2.1 FreshBooks (Fig 5) FreshBooks is a system for automating billing, changing them with a more straightforward interface, as well as for tracking costs and customers Using this service, you can send and manage accounts much faster, collect all payments in one interface At the same time, the platform supports credit cards, Google Checkout and PayPal Figure FreshBooks A key feature of FreshBooks is that it is based on a cloud service that provides access from anywhere and security The program also has a mobile application that allows you to use it outside the office Among other things, it has an easy-to- A key feature of FreshBooks is that it is based on a cloud service that provides access from anywhere and security The program also has a mobile application that allows you to use it outside the office Among other things, it has an easy-to-understand interface, which makes it easy to use Key Features of FreshBooks: Online Invoicing; Expense Tracking; Time Tracking; Projects; Payments; Accounting Reports & Taxes 2.2.2 NetSuite ERP (Fig 6) NetSuite is a single online business management suite, including enterprise resource planning (ERP), financial management, customer relationship management (CRM) and e-commerce The system is built on a modular basis, so you can use the full range of business software or start with either NetSuite Financials or NetSuite CRM modules, adding the missing features NetSuite includes project control, resource management, project accounting, and cost management Figure NetSuite ERP http://www.iaeme.com/IJM/index.asp 128 editor@iaeme.com Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun NetSuite ERP - accounting software for large companies It is a multi-functional business management platform With it, users can make faster daily financial transactions This is done using many management functions One of these functions is supply chain management With it, you can analyze needs and view sales forecasts to create a business plan Key Features NetSuite ERP: Accounting; Fixed Asset Management; Payment Management; Demand Planning; Inventory Control and Warehouse Management; Purchasing and Vendor Management; Manufacturing; Billing Management and Invoicing 2.2.3 Sage 50cloud (Fig 7) Sage 50cloud - accounting software for individual entrepreneurs and small companies It has three levels of service, and the upper level allows more than 11 users to work Its functions include tasks such as paying bills, billing, and managing expenses The uniqueness of the platform is that it is a hybrid desktop application with a cloud component for accessing and storing data The software can be used to track purchases and suppliers and pay bills It also has expense management features that include mobile payments and banking channels The product can be connected to bank accounts, allowing real-time registration of sales and receipts, tracking receivables, transferring funds, checking bank accounts and making deposits It also provides access to financial reports from any online device Figure Sage 50cloud Key Features of Sage 50cloud: Activity dashboard; Activity tracking; Automate purchase orders; Automated backup; Automated billing; Bank reconciliation; Batch processing; Billing & invoicing; Budgeting & forecasting; Cash flow statement; Collaboration tools; Consolidate financials; Contact database; Contact management; Control budgets and departments; Custom pricing; Customizable branding; Customizable templates; Drag & drop interface; Electronic payments; Financial analysis; Financial management; Forecasting; Inventory management & optimization; Invoice management & processing; Job costs, estimates, and invoicing; Mobile integration; Multi-currency; Order management & tracking; Pay bills electronically, print paper checks; Project budgeting; Project time tracking; Purchase order management; Purchasing; Quote management; Receipt management; Sales orders; Supplier management; Tax management; Templates; Transfer management; Trend analysis RESULTS ANALYSIS Currently, computer networks (local, regional, global) are being introduced everywhere, thanks to which remote access to network-wide resources is provided (databases, computers, http://www.iaeme.com/IJM/index.asp 129 editor@iaeme.com Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy printers, fax modems, etc.) The applied information technologies are an indicator of the “armament” of managerial work, a characteristic of potential capabilities of the enterprise (organization) management system as a whole Recently, the requirements for computer skills of users have increased significantly Choosing the best accounting software for a company is quite difficult It is necessary to focus on the main tasks that the component should solve, since different programs have a different range of functionality, prices, devices, etc The table below shows the comparative characteristics of accounting programs Table Compare FreshBooks, Sage 50cloud and NetSuite ERP by main features Main features FreshBooks Sage 50cloud NetSuite ERP SmartScore ™ by FinancesOnline 9.8 / 10 9.7 / 10 9.6 / 10 Customer Experience 99% 100% 99% Pricing (Starting from) $15 $44.97 by quote Monthly payment Annual Subscription Monthly payment Quote-based Pricing Model Monthly payment Annual Subscription Language Supported English Turkish Dutch Polish Swedish English English, Chinese, German, Japanese, Spanish, French, Russian, Italian, Dutch, Portuguese, Turkish, Swedish Available Devices Windows, Android, IPhone/IPad, Mac, Web-Based Windows, Android, IPhone/IPad, Web-Based Windows, Android, IPhone/IPad, Mac, Web-Based For Company Size Small Business Freelancers Small Business Large Enterprises Medium Business Small Business Large Enterprises Medium Business Available Support Email, Phone, Live Support, Training, Tickets Phone, Training Email, Phone, Training, Tickets To summarize the comparison of accounting systems For small and medium-sized businesses and fast-growing startups, FreshBooks is better suited in terms of scalability, intuitiveness, and pricing The Sage 50cloud program is aimed at the same market NetSuite ERP is best suited for enterprises For small transactions, using NetSuite ERP is inconvenient CONCLUSION Accounting is rightly called the language of business On the one hand, it is possible to describe the economic activities of any business entity, and on the other hand, accounting records provide a reliable picture of the organization’s activities, its financial and property status http://www.iaeme.com/IJM/index.asp 130 editor@iaeme.com Yaroslav Izmailov, Dmytro Pilevych, Liubov Shevtsiv, Yuliia Petlenko, Olha Driha, Antonina Lagun That is why it is essential to know this language not only for professional accountants but also for a full circle of specialists related to economics For example, managers, financiers, investors, business appraisers, professionals in the field of enterprise automation The development of accounting information technology in recent years is growing Any practising accountant works on a computer and does not think of his professional activities without him Modernization ("upgrade") and the change of generations of computer technology, the transition to new operating systems, updating versions of application programs, etc is a characteristic feature of modern computerization REFERENCES [1] Y O Izmaylov, Developing the System of Accounting and Taxation of Operations with Securities, July 2019, DOI: 10.32983/2222-4459-2019-7-231-239 [2] Nataliia Ostapiuk, Julia Stashenko, Systemization of accounting and taxation approaches of commission operations, December 2018, DOI: 10.15587/2312-8372.2019.168376 [3] Mates Dorel, Puscas Adriana, Ursachi Antonela, Ajtay Eduard, The influence of accounting system regarding accounting and taxation of entities, June 2016, DOI: 10.1515/jles-2016-0006 [4] Bashynska I.O Using the method of expert evaluation in economic calculations, Actual Problems of Economics, (169), 408-412 2016 [5] Nada Petrusheva, Darko Iliov, The flaws of the system of accounting for the value-added tax liabilities and receivables, and recommendations for overcoming them, December 2018, DOI: 10.35120/kij28051613N [6] J Atsu Amegashie, Asymmetric Information, Taxation, and Fiscal Accountability, May 2012, SSRN Electronic Journal, DOI: 10.2139/ssrn.2016606 [7] A.M Hadi, A.R Abed, H.O Kadim, The role of forensic accounting and its relationship with taxation system in Iraq, Academy of Accounting and Financial Studies Journal, 22(4), 2018 [8] D Pradhan, Dr P.K Swain and Dr M Dash, Effect of Management Accounting Techniques on Supply Chain and Firm Performance – An Empirical Study, International Journal of Mechanical Engineering and Technology, 9(5), pp 1049–1057 2018 [9] Reepu, Employee Related Accounting at NFL International Journal of Management, 9(1), pp 1–5, 2018 [10] Musarrat Ara and Dr Harani B, Environmental Accounting and Reporting: A Case Study of Universities’ Educational Curriculum Journal of Management, 5(4), pp 349–362, 2018 [11] Muhammed Zakkeer M., Jerry Varghese, S Jose, S.R Devadasan, Implementation and Financial Accounting of Quality Training and Education Programmes in a Plastic Products Manufacturing Company, International Journal of Advanced Research in Engineering and Technology, 4(5), pp 176–187, 2013 http://www.iaeme.com/IJM/index.asp 131 editor@iaeme.com ... Yuliia Petlenko, Olha Driha, Antonina Lagun, Information Systems and Technologies in Accounting and Taxation as a Means of Integration into the Digital Economy, International Journal of Management... and Taxation as a Means of Integration into the Digital Economy managing economic processes, and at a practical level - the search for specific ways of updating accounting and increasing relevance... Accounting and Taxation as a Means of Integration into the Digital Economy actively adopts the methods of related areas of management activity - planning, analysis, forecasting, modelling, etc The