Impact of E-Commerce on Management Accounting

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Date Submitted: 03/03/2014 01:53 AM

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Electronic commerce, also known as e-commerce or eCommerce, refers to commercial transactions

that are conducted over electronics medium such as the internet, computer network, mobile network(Investopedia n.d.)

Some of these transactions include buying and selling of product, accessing

online services and trading shares/stocks etc. conventional marketplaces for many kinds of transactions. For example, the Internet is an ideal technology for streamlining mortgage lending

processes. Customers can complete loan application over the Internet rather than tying up the time of

staffs in an office. Furthermore, data and funds can be sent back and forth electronically.


allows consumers to electronically exchange goods and services with no barriers of time or distance.

(Networksolutions n.d.)

With the flexibility offered by computer networks and easy availability of the internet, e-commerce has

become the fundamental platform for business around the world. Instead of using paper during

transaction, businesses have turn to electronic signals in virtual space as the preferred medium of

communication, both in and outside the organizations.

Consumers are gradually turning to the Internet to locate and purchase their goods and services.

Whilst having a rich source of product and company information, the Internet helps organizations to

provide better, faster, cheaper goods and services to their customers. For example, through regular

media coverage, growing interests in the technology sector, and a steady stream of product

announcements, public interest in the online phenomenon has greatly increased.

Internet e-commerce is redefining industry value chains, shrinking the dimensions of time and space

to create a dynamic competitive environment. This creates opportunities for businesses to perform

profitable activities online and serves as a distribution channel for both information and transactions;

Internet e-commerce is quickly...