Feasibility application of cloud accounting in vietnam

Accountant’s knowledge on Cloud AccountingGender of Accountants who don't know Cloud Accounting Gender of Accountants in Vietnam Current level of Cloud accounting in Vietnamese entities

OẠI HỌC QUỐC GIÃ HÀ MỘI

Last but not least, I would like to truly give thanks to all of the accountants and friends who sacrificed their working time to complete the survey and connect me with Inumbers of others.

Accountant’s knowledge on Cloud Accounting

Gender of Accountants who don't know Cloud Accounting

Gender of Accountants in Vietnam

Current level of Cloud accounting in Vietnamese entities

Types o f entities apply Cloud Accounting

Types of entities don't apply Cloud Accounting

i

IT Infrastructure of the enterprises for Cloud Accounting

Classify of entities have IT infrastructure for Cloud Accounting

Cloud Accounting of Vietnamese enterprises in future

Classify o f accountant whose company won't adopt Cloud

Accounting to the application o f Vietnam

Application of Cloud Accounting in Vietnam tomorrow

Classify of accountants who believed in future of cloud

accounting in Vietnam

Classify of accountants who did not believe in future of cloud accounting in Vietnam

Cost reduction of Cloud Accounting

Conveniences of Cloud Accounting

Numbers of updated features of Cloud Accounting

Figure 17 Upgrade and expansion o f Cloud Accounting 33

Figure 18 Enhance productivity o f Cloud Accounting 34

Figure 19 Costs of adopting Cloud Accounting 36

Figure 20 IT Infrastructure in adopting Cloud Accounting 37

Figure 21 Accountants’ resistance in adopting Cloud Accounting 39

Figure 22 Confidentiality of data in adopting Cloud Accounting 40

cost benefit evaluation

Table 3 I Influence of accountant’s knowledge of Cloud Accounting on

conveniences evaluation

Table 4 Influence o f accountant’s knowledge of Cloud Accounting on

Table 5 Influence o f accountant’s knowledge of Cloud Accounting on

33upgrade and expansion benefits evaluation

Table 6 Influence o f accountant’s knowledge of Cloud Accounting on

productivity benefit evaluation

Table 7 Influence o f accountant’s knowledge of Cloud Accounting on

36evaluation o f cost for this application

Table 8 Influence o f accountant’s knowledge of Cloud Accounting on

evaluation o f IT infrastructure for this application 37

Table 9 Influence o f current IT infrastructure of the entities on „ 0

J Oaccountants’ valuation of IT infrastructure for applying this

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Table 10 Influence of accountant’s knowledge of Cloud Accounting on

evaluation of accountants’ resistance for this application 39

Table 11 Influence of accountant’s knowledge of Cloud Accounting on

evaluation of Confidentiality of data for this application 40

Table 12 Difference between accountants’ knowledge toward cloud

accounting to their evaluation on benefit of cloud accounting

41

Table 13 Difference between accountants’ knowledge toward cloud

accounting to their evaluation on impact elements of adopting

L ist of Abbreviations

Abbreviations Full name

AFTA Asean Free Trade Are

WTO World Trade Organization

ASEAN Association of Southeast Asian Nations

SPSS Statistical Package for the Social Sciences

CHAPTER 1: INTRODUCTION

1.1 Research background

“Leading companies are utilizing IT upgrades to better manage their data, where to

store the data as a means o f becoming more agile, and finding improved ways to analyse their data and turn information into kftowledge that is actionable, ” said KPMG National Advisory

Innovation leader Stephen G Hasty (AccountingWEB Staff, 2012)

These days, how to properly manage and handle the data of the customers, partners, or the company itself is still one of the most high priority issues and the majority of enterprises are indeed getting stuck at this obstacle In order to control their database, companies first have to invest and measure various initial costs like hardware, software, networks, administrators, and maintenance Furthermore, they have to estimate the feasibility of systems expansion, upgraded equipment, and data security as well as the availability of the data

That is why it is really necessary to have a reliable, advanced technology that can fulfill the firm’s high demands; therefore, they can centralize on their core business activities rather than the IT infrastructures or technology Cloud computing has appearedas the rational

“answer” for all these requirements

Together with the development o f information technology,the business world is increasingly running with effectiveness and efficiency As an indispensable trend, cloud computing is a cardinal alternative of the high-tech field that ushers business work, and especially accounting, into a new era, with the term “cloud accounting” (Targeted News Service, 2010)

In Vietnam, cloud accounting and even cloud computing are still fresh terms which have just come to light in recent years Many domestic enterprises are quite reluctant for two reasons, they actually do not know for sure whether to adopt cloud accounting or not; and whether its features will raise costs or benefit them either

Up to now, there has been no research on the feasibility of the application nor the pros

and cons of accounting on the cloud in Vietnam Hence, the topic “Feasibility application o f

cloud accounting in Vietnam” takes this into account to figure out a new future for

accounting in Vietnam

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1.2 Problem statement

The majority of enterprises in Vietnam are still doubtful about cloud accounting technology, even with knowledge of cloud computing They wonder about whether this strategic plan can upsurge their business profit with minimal risk or not? (Greg Boyle, 2011) Data leaks and internal information disclosure are what all the organizations really take into top consideration when deciding whether to account in the cloud Although cloud computing has been known in Vietnam in the recent half-decade, this term still brings hesitation and they would rather purchase the main computer processors and hire the technical employees for improving the traditional accounting style rather than approaching the cloud (ITC News,

2011)

Unless the accounting work o f Vietnam wakes up and makes a change, it will fall out

o f date and be left behind by other countries, sooner or later As a result, Vietnam entities may own relatively very high cost - current accounting software, equipped with few advanced features, which makes logging-in possible solely in the office, and allows only a small volume

of accounting performance It may lead to poor business performance and the whole economy can be affected

Underlining the importance o f this topic is that Vietnam has been integrated to the knowledgeable and technological global economy by joining AFTA (2003) (FTA, 2012), and the WTO (2006) (WTO’s website, 2012); hence, Vietnam should upgrade and innovate the quality of information technology in business to survive, especially for accounting which is utilized in great depth in every business

1.3 Research questions and objectives

Based on the current information technology infrastructures o f Vietnam, many companies have the competitive advantage on the account to the cloud computing application, but cloud accounting is still a fresh phrase to all The paperis conducted by answering the three following question:

1 Whether Vietnamese organizations can adapt the cloud accounting into theừ operations or not?

2 What are the costs and benefits o f applying the could accounting into the Vietnam entities?

3 How the corporates can approach effectively to the could accounting technology?

According to the status quo of the stated research questions above, the paperis highlighted with the following objectives:

1 The first and foremost objective is to bring the cloud accounting in specific and the cloud computing in general to closer to the Vietnam entities The writing will break down the concept of the cloud accounting into more detail with appropriate illustrations in order to make it simply and easy that this cloud scheme can be employed smoothly by any organizations

2 The enterprises are more persuasive by the second objective which figure out the plus as well as the minus side of implementing accounting in the cloud; therefore,

it may hard for all the entities to “ignore” the cloud any more

3 The final objective is to give suggestion to the coiporates which guide them how

to carry out the could tactic sufficiently in accounting

1.4 Research statement

The paper is oriented for the Vietnamese entities to consider for improving of accounting activities by applying the accounting on the cloud Furthermore, the service suppliers of the cloud package may have better strategies to satisfy their customers’ needs and demands It is also a chance for the Vietnamese accountants to have a broader information and knowledge about the modem accounting concept in the information technology era In addition, the government agency may impose the properly regulations and legal corridors to protect the rights and duties for both service providers and users

Therefore, the writing is conducted to drawing the plainly future pathway to the likelihood of employing cloud accounting in Vietnam organizations By the way, the pros and cons of this technology will be indicated for the executives to compare and contrast for the right decision making whether to implement or not The suggestion way is also depicted for properly application of cloud accounting into Vietnam firms

1.5 Research structure

To make this paper easy for the readers to follow and get familiar with, it is comprised

of 5 chapters and each of them has its own specialized functions, purposes and detail parts.The paper is structured with the beginning of Chapter 1 which tells the readers the whole ideal about what is going to put the pen on This overall picture is drawn by the

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combination several parts like research background, problem statement, research questions and objectives, research statement and paper organization.

The following section is Chapter 2 which provides the needed theory to the issue o f cloud accounting under the name “Literature Review” In this case, all the relevant materials are the background information about could computing and especially about accounting on the cloud with its status quo in Vietnam

How the paper is designed? What methods are used to collect data? How the obtained data is analysed to become information? What are reasons behind the alternative ways? All the questions would be plainly satisfied under Chapter 3 with naming “Research Methodology”

Moving to the “Finding and Discussion” part categorised in Chapter 4 which not only provides the interpretation about the discoveries but also the reasonable debates and suggestions by using the combination of the literature context and the findings All of them will be illustrated and exemplified by appropriately supported figures and examples

The final Chapter goes for “Conclusion and Recommendation” which summaries the overall idea of the paper in brief My own personal judgments are also express to show the written evaluation about the research results Any limitations during the finishing time will indicated which is mainly based to give advices for the further research in the coming time.Appropriate source o f data used will be listed with the manner method in the Reference part and all the detail computations will be depicted as well in the end of this paper

CHAPTER 2: LITERATURE REVIEW

2.1 Cloud Computing

2.1.1 Definition o f Cloud Computing

The ideal of cloud computing is the transfer information technology services that the data is stored on the internet via the web-based tools and applications, instead of connecting directly to the server The cloud computing model provides access for users to the information and the software by the web-browser By this way, this cloud method allows employees to work at home rather than commuting to the office every day Specifically, the topic will be centralized on the cloud accounting of cloud computing services These may consist of the relationships between the service providers, users of services, and the needs and demands for new services to collaborate into the new accounting systems for the proper business models The traditional accounting is hard to fulfil the appropriate approach like it is with the cloud technology one (Investopedia, 2012)

2.1.2 Categories o f Cloud Computing

There are three types of cloud computing that are đemonsừated as following:

- Infrastructure as a service (IaaS): providing to the user of the service with the fresh infrastructure with the form o f virtual machines e.g raw computing power, storage, and bandwidth;

- Platform as a service (PaaS): which serves the application programming interface to develop the applications based on the abstract foundation such as databases, development tools, and other components;

- Software as a service (SaaS): supply the software service remotely to the customers such as word processing, email and spreadsheet, and even with customer relationship management (CRM) or enterprise resource management (ERM) (Archielndian, 2010)

2.1.3 Benefits o f Cloud Computing

capital cost into to operational expenditure, research development, or potential portfolio This will create chance for the company to use the IT infrastructure provided by the 3rd party, rather than investing for computing tasks done one time or depth, but not often Then, the valuation is based on the computation in demand of usage which is good for the options based

on the use and minimal IT skills are required (or not required) for the implementation

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- Independence: The independence between the device and the location make the users

can access the system using a web browser without regard to theừ location or what device they are using, such as PC or mobile devices Hence, for off-site infrastructure provided by 3rd party which can be accessed via the Internet, so users can connect from anywhere and anytime

- Sharing: The lease of a lot to be able to share resources and costs across a large

range o f users, enabling to: Centralized infrastructure in areas with lower costs (such as real estate, electricity, etc.) Improve load bearing ability (tile user does not need to engineer for highest possible load) Improving the use and effectiveness for systems that are often only 10- 20% is used

- Reliability: Improved reliability through the use of multiple redundant sites, making

it suitable for business continuity and recovery failed However, the majority o f cloud computing services with time shortage and the director of the business and IT to make it less

- Flexibility: Elasticity flexibility ("demand") to provide resources on a smooth base,

the service itself and near real-time, without users having to engineer for load bearing Performance is observed and consistent architecture, loose connection structure using the web service communication system

- Confidentiality: The improved security due to centralization o f data, security focused

resources, etc., but also raise concerns about losing control of sensitive data Security is often

-as-good-or—better—than traditional-systemsị—m-part-beGauseproviderscan-devote-more

resources to solving security issues that many customers do not have enough cost to make The supplier will remember (log) access, but access to the audit logs themselves can be difficult or not

Cloud accounting really is a chance for developing countries such as Vietnam, enabling cost savings for investment in infrastructure, support business decisions quickly Furthermore, together with the development of platform, it does not requữe organizations to pour capital to build the business knowledge of IT infrastructure investment as before Thus,

in 2011 there have been many positive changes in Vietnam, said Steve Chang, Chairman of Trend Micro

Cloud computing brought the opportunity to IT professionals and help raise the value

of the business strategy in the process o f building new skills Solutions on the Microsoft private cloud will help the IT professionals in the construction pioneering cloud for business,

management and transfer applications demand through personal cloud, tissue public or hybrid cloud, Microsoft vice president Brad Anderson (Microsoft’s webpage, 2012)

2.1.4 Cloud Computing Implementation in Vietnam

"Asian nations are investing in cloud centers o f economic development and are adopting cloud services fo r their own use They are very focused on the cloud opportunity ”

Joe Tsang- Technology Industry Leader o f Asia-Pacific (Global Technology Industry Discussion Series, 2011)

With the establishment of the Center for Cloud Computing in Vietnam in 2008, Vietnam became one of the first ASEAN country apply this cloud technology Up to now, with the specific services and applications, the concept cloud computing is getting familiar Nevertheless, to understand precisely about this term which is the most concern o f technicians

is a different story (Hien Anh, 2011)

According to a recent survey of Symantec corporation, there ai[e 46% o f organization

in Vietnam is implementing the cloud computing in which the privately storage service is the most popular with 39% entities carry on, and other services like virtual processor computer, virtual storage has the slowest level of application with only 20% of enterprise adopt

At the present, many corporates take advantage on the cloud computing for the essential applications in their business activities which 64% of them are planning to virtualize theữ database in the upcoming 12 months, 45% of units will going to “cloud” Enterprise Resource Planning (ERP) application and websites, and 60% entities intent to “cloud” in the E-mail and schedule applications

However, the process of implementing the cloud technology into some key business applications is too slow with 40% of business software like ERP, cloud computing or Customer Relationship Management (CRM) is upload in to the cloud environment (Viet Dung, 2011)

According to Vo Tan Long, General Director of IBM Vientnam, in 2011, awareness of cloud computing technology in Vietnam has changed significantly It was resulted from the public mass media, businesses, and government blocks more than the last year

Cloud computing is increasingly influential in Vietnam, however it is also a new technology and the process of application should carry out through the steps by steps as testing, deployment from the smallest scale at first

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On the basis o f fact, Mr Long aỉso shared that from this time until 2015, cloud computing market in Vietnam will go upsurge by about 3 5 - 4 times, and in the end of 2012, the annual growth rate is expected to reach about 50% There will be a boom o f cloud accounting in Vietnam, but it's an explosion of a clear roadmap, along with the consideration and review reservations from now when they reach a platform o f a new technology - cloud accounting (Viet Dung, 2011)

2.2 Cloud accounting

2.2.1 Definition o f cloud accounting

Cloud accounting is the most popular topic in the accounting word at these days Unlike the traditional accounting which the accounting software is bought as a product and installed into the computer, cloud accounting allows the users to purchase the accounting software through online services and they can be utilized via the internet (Smith & Williamson, 2010)

The term o f cloud accounting is the method o f enhancing value and capability to the entities, but not really focuses on the human capital, the system or software It involves of improving either web based subscription or the service that enlarges values to the IT know­hows by providing real time of the web-based to the accounting works (Cathy Olivares,

2010)

2.2.2 Categories o f Cloud Accounting

- Infrastructure as a Service: this kind of platform transforms all the cuưent information technology of the accounting system into the “sky” which also retrofits more features and functions

Software as an Service: this approach emphasis on the service itself, using comfort, new upgraded in frequency, and by the way the service providers has altered the satisfaction method to customer by centralizing more in the themselves services (Richard Messik, 2012)

2.2.3 Benefits o f Cloud Accounting

Lower IT Costs: With cloud accounting solution, the corporates will spend less of

wasting time and money for upgrading either hardware or software every time when there is a new version o f one them or both launch out The work of updating and maintaining the

software service can be carried on remotely by the providers; therefore, the user always working with real time data - based in the same version without any compatibility problem.

Easy Access: The users of the cloud accounting can access effortlessly to the

accounting and financial information anywhere and anytime with a connected internet computer The owner of the cloud accounting will gain benefits from the less commute time between home and office and fewer on-site client visits

Scalability: When the organizations of using the could accounting service expand their

business operations, it is not necessary for them to seek for a new accounting system solution which proper with the new transformation Majority of cloud computing applications are subscription-based, which the users have the alternative to add-on the features or functions that meet their need and they just have to pay for what they use

Flexibility The approaches that the users can utilize cloud accounting to the

operational activities are unlimited I For example, fravel expenses can be logged on the road, making expense reports a snap Employees can track their time and submit timesheets from anywhere, making payroll processing substantially faster Many cloud computing solutions also allow you to integrate other business solutions such as an enteiprise resource planning system or client relationship management program (Cloud9 Editor, 2012)

2.2.4 Comparison between cloud accounting and accounting on premise

Cloud accounting Accounting on premise

The accounting systems can be set up and

operate smoothly via the Internet by using

webpages

All the accounting applications only can be installed and ran offline through offline servers

The costs for using the services are actual

basis amount for how and what have been

used monthly or quarterly

The costs are usually paid in advance and over the time for the application providers

It need less IT technician because

everything can be served by the providers

via the web browsers and number

crunchers due to the enhance productivity

More IT staff should be in-house all the time for unpredictable problem occurs

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The accounting software will be updated

and upgraded automatically without any

Once there is a new version accounting system, it will be released with high costinterfere of the company and result disruption

All the data will be stored on the “cloud”

by the application providers which have

duties for confidentiality and back-ups

The enterprises have to secure and keep the data for its own

The accounting software, hardware or even

with the licenses are free from on-going

costs

On-going costs will cover all the application software, hardware and licenses as well

Provide the company with very quick

return on investment

The company may wait for a long time before on the investment turning into return

The interface is open to interact effectively

between the providers and customers;

hence, they have more choice on cloud

There is no any research or survey on the level of using cloud accounting in Vietnam, the number o f supplier is limited with only some cloud accounting providers namely: Fast Software Company, NEO, EVIET, OnlineBiz, MISA, and NEXSoft One o f the blue chip company users o f cloud accounting is ViettelPost which adopted the service from NEXSoft in the year end of 2001 (ITC News, 2011)

There are two hypothesises in this writing which is based on the Literature Review Chapter and the possible benefits of using the cloud accounting as well as the impacts on the implication of the cloud technology in Vietnam.

Hypothesis 1: It is undeniable that the cloud accounting has many advantages in

compared to present accounting technology In this case, the interests is assumed to be as

! lower cost, convenience, updated features, scalability, and enhanced productivity

Hypothesis2: In contrast, there must be some reasons for the top executive to rely on

tie alternative o f refusing their accounting works on the cloud which supposed to be the higher cost, poor IT infrastructure, conservative accountant, and confidentiality

H0: There is positive relationship between the knowledge of accountants toward cloud accounting and the evaluation o f the impact factors of adopting cloud accounting

Hi: There is negative relationship between the knowledge of accountants toward cloud accounting and the evaluation o f the impact factors of adopting cloud

accounting

2.3 Hypothesis

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CHAPTERS: RESEARCH METHODOLOGY

3.1 Scope of the study

The boundary of the research is limited to the production, service and government organizations The entities have been surveyed on which are in both domestic and foreign, public and private, production and service, various kinds o f hierarchical structures, in diversified fields of business These organizations were stretched along from the North to the South o f the nation to make the paperobjective and free from bias

3.2 Research method

The key investigating approach of this writing is the surveying method during the time from August to October 2012 on the feasibility application of the cloud accounting in Vietnam which comprised of both quantitative and qualitative as well

3.2.1 Quantitative methodology

This research method refers to the process of gathering, analysing and presenting the information from raw data in any phenomenal issues of the research that mainly related to numbers The quantitative inquiry is based mainly on the theories which can be demonstrated

in practice and by subjective aspect because o f the principle in numbers.(Yvonne Carter and Cathryn Thomas, 1997) In this case, the quantitative research amplified mostly to the closed questionnake in the survey The statistical result is used to test the truly hypothesises through table, chart, and graph indications

3.2.2 Qualitative methodology

Pointing to the written data is known as qualitative approach which collects, describes, and analyses the characteristic of the subject matter This form of method specializes to deductive reasoning and theoretical creation which used interpretation outlook and does not prove anything but explaining through the tectonic theory in the study (Karin Klenke, 2008) Although the qualitative method can be carried out via the survey, but the inquiry must be in open question - the approach of this thesis The qualitative data also collected by interviewing several top executives in blue-chip enterprises to assure the qualitative information more diversified and reliable

3.3 Data source

3.3.1 Primary data

Primary data is original research data in its raw form, without any analysis or processing which provides the most useful of information for the specific purpose of researchers (WiseGREEK, 2011) In this thesis, to fulfill the research question which research

on the feasibility of applying could account was bases the primary data In different organization with different in business sectors, they may use different accounting system which the supplier cannot meet theữ need The second research question is also made sense with using the primary data to investigate the advantages of adapting the cloud account Although the secondary can provides tons of benefit o f the accounting in the cloud, but it just the assumption which cannot compare to the experience of utilizing by the real users The primary data also support more advices as guidelines for the companies who would like to apply cloud for their accounting work in order to make the third research question more factual and reliable

3.3.2 Secondary data

Secondary data is the data which have been gathered for other purpose and available from other sources With this kind o f date, the information are cheaper and more quickly obtainable than the primary data and also may be available when primary data cannot be obtained at all (Nancy.s, 2011) In this thesis, secondary data is useful for all the investigate objective, especially in the second objective which focusing about the benefits of the accounting in cloud It is also helpful with the third objective by some foreign websites which provides some guideline for the new user of the cloud

3.4 Data Collection of the survey

The data was gathered by two main channels: (1) Direct: this channel was used with the company near Hanoi which is easy for the printing question papers and doing the interview as well (2) Indirect: The paper was on the cloud, part of the question can be conducted online through Google Doc under the link http://tinvurl.com/NCKH- CloudAcounting for the company which located far away from Hanoi

3.5 Research tool & Sampling

3.5.1 Questionnaire

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For the primary data, this paper shall emphasis on doing survey including questionnaire and interviews survey The question on survey is conducted thoroughly which

is examined by the Vietnam literature Afterwards, these questions will be tested with small number o f students who study of accounting for the improvement of the question papers The final test will be done by the small sample of entities whose using the cloud accounting for confirming the clear and understanding to the survey question Finally, the questions will be adjusted for the proper with the status quo as well as the business sectors of the organization

3.5.3 Interview tool

The interviews have been conducted with some managers who supply the cloud accounting services and chief accountants of some big organization to obtained objectively better data

T Test technique

CHAPTER 4: FINDING AND DISCUSSION '

4.1 Status quo of Cloud Accounting in Vietnamese organizations

4.1.1 Accountants ’ knowledge on Cloud Accounting

Before discussing to other aspects of this research, the general knowledge of accountants on Cloud Accounting were analysed thoroughly because it would affect the whole investigation by the filled surveys on Every number cruncher will have different level

of understanding about accounting on the cloud; that is why, they may have similar evaluation, but maybe not

Figure 1: Accountant’s knowledge on Cloud Accounting

The classification of what accountants are acquainted with cloud accounting was allocated from known and unknown category In 89 asked surveyees, 67% of them have knowledge on the cloud accounting either understand wisely or just a little bit on that issue In contrast, the leftover 33% still neither know nor know yet about what is accounting on the cloud

How the accountant familiar with this IT accounting system will decide how true and faữ of this investigation through all the collected data Hence, this assessment plays as a key indicator for the analysis and discussion sections However, it does not mean this pointer has

its own subjective on the account o f this can be influenced by other factors such as gender o f accountants Cloud accounting system is directly related to the IT especially with cloud computing technology Naturally, men are usually more favourable with the computing field that women; and cloud accounting is not an exception.

Hence, gender o f “accountants w ho^o^otim ow aboutxloudaccottntingisanalyzed-to check out whether there are more men and women In 67% accountants who had no ideal about the accounting on cloud, female crunchers made up 83% of them while this index only 17% for male

Nevertheless, this status quo may be resulted from the gap between the number of male and female accountants The more the female accountants, the more they contribute for the number of accountants who have not heard o f accounting on cloud Thus, it absolutely made sense when the investigation found out that there are more than 70% o f accountant in female, and only 29% for male gender in Vietnam

Gender of Accountants In Vietnam

B Male

Ũ Female

Figure 3: Gender of Accountants in Vietnam

The consequence can be explained that women usually prefer to paper work in the office rather than men Furthermore, accounting works are always related to numbers and calculations which may be very complicated and inappropriate for men In fact, men are more outward and active, then marketing, public relation, or technician one o f theữ first alternative

4.1.2 Level o f Clouding in accounting system in Vietnamese entities

According to the recent survey by research firm Gartner shows that the growth of

"cloud" around the world has reached an annual rate of 17% with over 50% of businesses and organizations have deployed cloud computing in many forms Gartner also pointed out that,

of the total value for the cloud services is nearly $ 2.4 billion and 2013 will reach $ 8.1 billion As per evaluation of IBM, Microsoft, HP, etc have said that Vietnam is also in the same trend of globalization (Nguyen Due, 2012)

If so, Vietnam also has approximately 50% of entities adopting the cloud technology, but with accounting on the cloud is another ratio One of the most crucial question was asked

to the surveyees is whether the companies where they are working have employed cloud accounting or not The finding indicated that the number of organizations are utilized the cloud for their accountants which is a very low percentage with only 6% The remaining 94% entities might do not apply cloud accounting or not yet at the moment of the survey

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Current level of Cloud accounting in

Vietnamese entities

Figure 4: Current level of Cloud accounting in Vietnamese entities

IThe quantity of accounting on the cloud of Vietnamese entities only made up 6% in which comprised the fields of production, service, and government agency In detail, there were no any accountants in agencies of the state carry on their accounting activities on the

cloud On the contrary, production and service organizations contributed up to 60% and 40 % respectively for this category

Types of entities apply Cloud Accounting

The difference can be interpreted by the budget for IT development in the non­government companies is usually higher than the state entities They use high salary scheme and high job enlargement to appeal talented IT technician to contribute for them Consequently, they have capital resource and human resource as a reasonable foundation to research and apply the cloud to their accounting departments.

The Figure 6 below indicated the distribution of 94% companies which neither not or not yet applying cloud accounting to theữ operational activities These companies were comprised of 31 %, 48%, and 21 % for the production, service and state entities, respectively

Types of entities d©n"t apply Cloud

Accounting

i

Ì lg§#S|iifev J&r* i&H igjgf Q Production

0 Service

u Government agency

Figure 6: Types o f entities don't apply Cloud Accounting

Base on the evaluation of title experts from IBM, Microsoft, HP, Trend Micro, the majority of the Vietnamese market is still in a status of waiting and testing technology applications for cloud computing Recent IDC research also depicts that there are many different concerns from the business organizations For instance, 13% of them go for the unavailability of cloud computing, or 40% companies take into account of the government regulations and legislation as well as compliance with open standards; and the interaction among different cloud technology platforms remains a concern issue (Nguyen Due, 2012)

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4.2 Feasibility aDDỈicatioo of Cloud Accounting in organization in Vietnam

4.2.1 Current IT Infrastructure o f the enterprises fo r Cloud Accounting

IT Infrastructure of the enterprises for Cloud

Accounting

Figure 7: IT Infrastructure o f the enterprises for Cloud Accounting

There are 63% of asked accountants said that their companies have enough IT capacity

to meet the condition for implementing cloud accounting whereas the leftovers 37% of number crunchers’ companies are not ready for moving “cloud” It may since that they are in small and medium scale of business; hence, IT infrastructures for cloudizing are not necessary

Classify off entities have ST Infrastructure for

CSoud Accounting

0 Applied

B Didn't apply or Not yet

Figure 8: Classify of entities have IT infrastructure for Cloud Accounting

Due to the fact of investigation, there was 63% of enterprises can fulfill the IT infrastructure for the transform the accounting activities to the cloud On one hand, there was

a limited cases with 7% taking this advantage for develop cloud accounting On the other hand, 97% o f the firms are really wasting their resource allocation, especially with the IT system Those companies might have already adopted cloud computing, but still doubt about accounting on the cloud; or they might have not prepared for this application yet

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4.2.2 Will entities employ Cloud Accounting?

Cloud Accounting of Vietnamese enterprises

in future

a Yes

El No

Figure 9: Cloud Accounting of Vietnamese enterprises in future

There was 83% o f accountants supposed that their entities will implement the cloud technology for them in the near future However, there was still 17% of the crunchers thought that there is no tomoưow for cloud accounting in place where they are working The numbers oflho se 17% accountants were categonzed_iĩFtlĩẽTfõllỡmng~Figure 10_tõ^h_ẽcknõn_their evaluation about the possible application of cloud accounting in Vietnam

Classify of accountant whose company won't

adopt Cloud Accounting to the application of

Vietnam

Figure 10: Classify o f accountant whose company won't adopt Cloud Accounting to the

application of Vietnam

Fortunately, majority 74% of them were still optimistic about the feasibility adoption

of the cloud technology into Vietnam accounting The remaining ratio was divided equally with the same 13% in neither believing now knowing about the how cloud accounting will be

in Vietnam

4.2.3 The fu ture o f Cloud Accounting in Vietnam

This research is centralized in the feasibility application of cloud accounting in Vietnam; therefore, the accountants’ assessment on the questionnaire specifying this area is the key valuation Nearly 90% of surveyees felt confidence in the future adoption of accounting in the cloud in Vietnam because of its own benefits and the general trend whereas

there was 9% of crunchers had the opposite assumption owning to the poor IT structure and

unnecessary; the leftover 4% of accountants had no ideal about that

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Figure 11: Application o f Cloud Accounting in Vietnam tomorrow

Based on what going so far, the crunchers have sensible foundation to believe in the

cloud accounting in Vietnam soon or late Although recently there are only 6% of companies

utilizing their accounting activities in the cloud, well over 60% o f entities’ IT infrastructures are available and ready to cloudize In addition, nearly 85% o f Vietnamese organizations are going to carry out this cloud application in the future, and the priority of remaining numbers

is not doubtful at all about the tie relationship o f Vietnam accounting to the cloud

Classify of accountants wh© beliewed in fyture of cloud accỡunting in Vietnam

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Classify of accountants who did not

Due to the fact that some of accountants who had no knowledge about the accounting

on the cloud As the result, with the very small number of 4% crunchers who had no idea about the future of this application in Vietnam accounting

4.3 Benefits of adopting Clouding Accounting

This research also analysed each benefits of the cloud accounting technology by the questionnaires to accountant surveyees which are also compared to theữ knowledge to the research topic in order to make the result more reliable and objective The level o f evaluation about was ranged as follow 5- very good; 4 - good; 3 - average; 2 - bad; 1 - very bad

4.3.1 Cost reduction

One of the most considerations o f the plus side of cloud accounting is the cost which plays as the cardinal key to survive of any businesses In this case, the lower the cost reduction in the process of installation of cloud computing, the more decisions of adoption are made.

Figure 14: Cost reduction of Cloud Accounting

More than 20% Vietnamese accountants supposed that cloud accounting will be very good for them in reducing cost of accounting process activities while the largest distribution nearly 50% ranked for the good level in cutting cost o f applying the cloud There was still approximately 25% going for the average degree; and simultaneously 7% contributed for the not good extend in cost lessening for accounting in the cloud

Deviation

std Error Mean

298

Table 2: Influence o f accountant’s knowledge of Cloud Accounting on cost benefit

evaluationAccording to the understanding of the number crunchers about this investigating topic, there was 66% of accountants in the group o f know about cloud accounting valued the dropping cost at the level average with 3.8983/5 which similar rank to the group o f do not know about cloud technology with 3.6667/5 making up 34% In overall, the group has more knowledge about the topic evaluated the cost benefit a little bit higher that the other one although they are just in the same category It might cause by the general psychology of all accountants who took the cost into same consideration level in spite o f their position, knowledge, experience may differ from others

4.3.2 Conveniences

When mention about cloud technology, everybody will think of how convenience it can brings for the users In other words, the users in this case are accountants who work directly with cloud approach With its ' conveniences, you can access to the company’s accounting system with the appropriate Internet connection devices everywhere and any time

Conveniences of Cloud Accounting

Figure 15: Conveniences o f Cloud Accounting

Well over 50% accountants ranked the conveniences in the good class in compared to the higher level - very good with more than 30% distribution o f evaluation Moving lower

category is average and not good which contributed for 13% and very slight change number with only 1%, respectively.

of the each class, they would give better assumption about the conveniences than the other group

4.3.3 Numbers, o f updated features update

The specialized characteristic of technology is the updated features which can be brought up-to-date every month, every week, or even everyday Unless follow this trend, one company can be left behind, lost the track to development, and poor productivity performance

in compared to others In fact, the normal accounting systems of a full package are usually less updated feature, even and some of them are offline systems which have no any updating

at all

300

Numbers of updated features of Cloud

Figure 16: Numbers o f updated features of Cloud Accounting

In the case o f cloud accounting, the two categories o f good and average had almost the same evaluation for numbers of undated features by surveyees with nearly 40% of 17% of accountants valued this benefit in the very good class while there was till 7% o f them went for the not good level

respectively This similar alternative can be interpreted that they have the same expectation of the unknown group just as the understanding of known group for this kind o f benefits.

4.4.4 Upgrade and expansion

The entities cannot stay in the same level of operation; hence, they will have to extend the economics of scale, soon or late One day, they may spread out more new branches or subsidiaries, products or services and even with brands and goodwill Nevertheless, each of change either fade in or fade out are all affected to expand or lessen the accounting system In those cases, the users have no choice but switch into another appropriate package service which may cause to losing data or time consuming to get harmony with the new one With the cloud accounting technology, all of the actions mentioned above can be exercised easily by the service provides

Upgrade and expansion of Cloud Accounting

302

Deviation Mean

Table 5: Influence o f accountant’s knowledge of Cloud Accounting on upgrade and

expansion benefits evaluation66% of know and 34% of unknown group of accountants about cloud accounting have almost the same level evaluation for upgrade and expansion advantage in average level which was contributed for 3.6610/5 and 3.6667/5, respectively The valuation figured in that way which may due to cruncher in the known group They only have had knowledge in the field, but have not ever operated the accounting activities on the cloud Therefore, the same level of evaluation on this benefit o f cloud accounting is difficult to avoid

4.3.5 Enhance productivity

Improving yield has played a huge role in the production of goods as well as services which contribute to the Gross National Product in particular and economic development o f a country and the world in general Undoubtedly, once the productivity of the accounting performances is improved, any other operational activities also have more value - added

Enhance productivity of Cloud Accounting