Volume: 19 Issue-01 (January-June) 2024

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CRISIS MANAGEMENT AND THE ROLE OF ACCOUNTING SYSTEMS: LESSONS FROM GLOBAL ECONOMIC CHALLENGES

ABSTRACT

In the wake of unprecedented global economic challenges, this review paper critically examines the role of accounting systems in crisis management. Focusing on lessons learned from past economic crises, the paper explores the dynamic interplay between accounting practices, financial reporting, and effective crisis response strategies. By synthesizing existing literature and case studies, this review aims to provide insights into the multifaceted dimensions of crisis management within the context of accounting systems. The review begins by delving into the conceptual foundations of crisis management and its relevance to accounting frameworks. It underscores the pivotal role of timely and transparent financial information in facilitating informed decision-making during periods of economic turmoil. The paper investigates how accounting systems act as essential tools for assessing the financial health of organizations, enabling stakeholders to gauge risk exposure and make strategic adjustments in response to crisis-induced uncertainties. Furthermore, the review analyzes the evolving role of accounting standards and regulatory frameworks in enhancing financial resilience and accountability. It explores the challenges and opportunities presented by international financial reporting standards, emphasizing their role in fostering global comparability and transparency. Drawing on case studies from various global economic crises, including the 2008 financial meltdown and the recent challenges posed by the COVID-19 pandemic, the paper highlights the adaptive capacity of accounting systems in addressing diverse crisis scenarios. It examines the impact of crisis-induced disruptions on financial reporting practices, internal control mechanisms, and risk management strategies. Moreover, the review addresses the role of technological advancements, such as blockchain and data analytics, in revolutionizing accounting systems for more robust crisis preparedness and response. It sheds light on how innovative technologies contribute to real-time financial reporting, fraud detection, and improved decision support mechanisms. This paper synthesizes key insights into the symbiotic relationship between crisis management and accounting systems, offering valuable lessons for practitioners, policymakers, and researchers. It emphasizes the need for continual adaptation and innovation within accounting practices to navigate the complexities of the contemporary economic landscape.

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