The Effect Of ERP System Implementations on the Usefulness of Accounting InformationResearch QuestionAccounting information usefulnessHypothesesTheoretical ModelsReliability ModelRelevancy ModelResearch DesignRegression Model -Reliability AnalysisRegression Model -Relevancy AnalysisDataSlide 12Slide 13ConclusionsLimitationsSlide 16Slide 17The Effect Of ERP System Implementations on the Usefulness of Accounting InformationResearch Question Does ERP implementation affect the usefulness of accounting information?Two primary qualitative characteristics–Reliability–Relevancy•TimelinessAccounting information usefulnessHypothesesH1: ERP implementation reduces reliability of accounting information.H2: ERP implementation improves timeliness of accounting information.Theoretical ModelsReliabilityERPERPTimelinessReliability ModelReliabilityERPERPDiscretionaryAccrualsConceptual LevelOperational LevelConstructValidityRelevancy ModelRelevancyERPERPReporting LagConceptual LevelOperational LevelConstructValidityResearch Design One-group pretest - posttest design–tests a single group before and after a treatmentWe test a group of companies before and after the implementation of ERP.Regression Model-Reliability Analysis•Dependent Variable---Discretionary Accruals•Independent Variable---Pre (no ERP) and Post (ERP)•Control variables–To control for confounding factors and increase internal validityOCFMTBLEVLGTAEXTENTIMPYRAFTABSDA76543210Regression Model-Relevancy Analysis•Dependent Variable---Reporting Lag•Independent Variable---Pre (no ERP) and Post (ERP)•Control variables:–To control for confounding factors and increase internal validityESURPEXTENTESURPAFTIMPYRESURPEXTENTAFTLAG**6543210Data•We obtain our sample of ERP system adopters from a proprietary database supplied by a leading international provider of ERP systems. •Sample size–Reliability analysis:1645 observations–Relevancy analysis: 1585 observationsReliabilityAnalysisResultsRelevancyAnalysisResultsConclusions•ERP implementations reduce accounting information reliability.•ERP implementations improve accounting information relevancy.Limitations•Research Design-pretest and posttest design –Advantage: comparisons are made by the same subjects.–Disadvantage: confounding factorsAlternative Designs?Limitations•Measures for reliability and relevancy–Construct validityLimitations•Sample selection–Selection bias–External