Paper presented at ICBER2012 Bandung 2012

1. UNDERSTANDING ACCOUNTING INFORMATION
SYSTEMS CONTINUANCE INTENTION AMONG SMEs
IN TERENGGANU, MALAYSIA
By: Azwadi Ali, Mohd Shaari A. Rahman & W.N. Syahida
Faculty of Management and Economics,
Universiti Malaysia Terengganu, MALAYSIA.
Bandung, Indonesia. 12-13 March 2012.

2. Introduction
 Examine the effect of antecedents to attitudes and the mediating
effect of satisfaction on AIS users’ intention to continue using
AIS.
 Continuance intention to use AIS as a more reliable measure of
AIS implementation than a mere adoption – after all, majority of
business organizations have adopted AIS.
 Unit of analysis – SMEs in Terengganu.
 SMEs as backbone of a nation’s economy – effective use of IT is
important for proper accounting reporting.
 Self-report survey.
 Use Partial Least Squares (PLS) path modelling to test
hypotheses.

3. Accounting Information Systems &
Continuance Intention
 AIS include computerized accounting applications ranging from
simple Excel, off-the-shelve accounting packages to bespoke
sytems.
 AIS help proper accounting records and reporting to assist
management decision making.
 Users may range from innovators (quick to adopt) or followers
(wait and see).
 Since IT has dominated business applications, it is more
important to assess the effectiveness of AIS through users’
intention to continue using them than a mere adoption (many
earlier studies on AIS)
 Continued use of a systems is only possible when users are highly
satisfied with it.
 Antecedents and attitude as well as satisfaction as
mediators are included in the research model.

4. Antecedents and mediators
 Attitudes and satisfaction are conceptualized as mediators.
 Antecedents of attitudes include Cost (Premkumar & Robert
1999), Relative Advantage (Rogers 1992; P&R 1999), Perceived
Strategic Benefits (Chau 2001), Ease of Use (Davis 1986),
Organizational Readiness (Ramdani & Kawalek 2007),
Compatibility (Rogers 1995), Competition (R&K 2007) and
Vendor Support (Thong 1999).
 The model is developed after synthesizing variables of Davis’
Technology Acceptance Model and Rogers’ Diffusion of
Innovation into Oliver’s Expectation-Confirmation Theory.

5. Research Model

6. Research Hypotheses
H1: Cost is negatively related to Attitude towards AIS
H2: Relative Advantage is positively related to Attitude towards
AIS
H3: Perceived Strategic Benefit is positively related to Attitude
towards AIS
H4: Ease of Use is positively related to Attitude towards AIS
H5: Readiness is positively related to Attitude towards AIS
H6: Compatibility is positively related to Attitude towards AIS
H7: Competition is positively related to Attitude towards AIS
H8: Vendor Support is positively related to Attitude towards AIS
H9: Attitude towards AIS is positively related to Satisfaction
H10: Satisfaction is positively related to Continuance Intention

7. Methods
 Study population was identified through business directory
available from SMECorp – nearly 300 SMEs in Terengganu.
 Trained enumerators distributed the questionnaire.
 80 enterprises declined to participate, 38 indicated that they did
not use AIS in their businesses and 24 were failed to be found.
 146 usable responses were successfully gathered during the 6-
week of survey administration.
 Measures of variables were not piloted since they were validated
through previous studies.
 Use PLS analysis due to small sample (less than 200 responses).

8. Results
 CFA performed on antecedents of AT extracted 5 factors with PSB
and EOU combined with RA, while COMP was removed due to
low loadings of items.
 Model was tested using PLS algorithm (300 maximum
iteration, standardized values and centroid weighting scheme).
 Loading of measures were all above 0.65.
 the minimum construct composite reliability is 0.88 (COST) while
the minimum construct AVE is 0.56 (RA) – all above thresholds.
 The structural model explains 51%, 68% and 63% of the
variances for attitudes towards AIS, satisfaction and continuance
intention, respectively.
 Only two of the antecedents of attitudes are significant while
both attitudes and satisfaction are highly significant in
predicting continuance intention.

9. Structural Model
Note - CFA performed on antecedents of AT extracted 5 factors with PSB and EOU combined with
RA, while COMP was removed due to low loadings of items.

10. Discussion
 Only Relative Advantage and Readiness (β = 0.406 & 0.180) in the
formation of users’ attitudes.
 Cost was not significant maybe due to decreased AIS price (or
possibly due to abundance of pirated applications).
 Compatibility was not found significant maybe due to
computerized applications these days are developed user-
friendly in the first place to be compatible with organizations’
differing technological platforms (though many are windows-
based).
 although vendor support was not found to be a significant
determinant of attitude, after-sale services are still important
because users may still consider continuing using the AIS despite
of poor support from vendors due to considerable negative
consequences from not using AIS at all.

11. Limitations and Conclusion
 Modest sample size of 146 and focus in Terengganu state.
 Pre-identified antecedent variables of attitudes. Could include
size, age of business and owners’ characteristics as moderators.
 This study contributes to related literature in the use of
information technology.
 developers of AIS should consider aspects that can encourage
positive affects in users when designing and improving AIS so
that loyalty in their products can be expected.

12. THANK YOU
Contact: shaari@umt.edu.my
Faculty of Management and Economics,
Universiti Malaysia Terengganu, MALAYSIA.