The Impact of Digital Transformation in Accounting on Business Performance: The Mediating Role of Cost Reduction in an Emerging Southeast Asian Economy

Abstract

This study investigates how accounting digital transformation influences enterprise performance in manufacturing firms in emerging economies, highlighting the mediating role of operational cost reduction. Grounded in the resource-based view, dynamic capabilities theory, and the technology-organisation-environment framework, the study evaluates four dimensions: technology, databases, human resources, and process digitisation.  Using a quantitative survey design (N = 395), empirical data from financial managers and chief accountants were analysed via partial least squares structural equation modelling in SmartPLS 4.0. Results show that all four digital dimensions significantly drive cost reductions, thereby enhancing firm performance. Process digitisation and human resource competencies demonstrate the strongest indirect effects on performance through operational cost savings. The structural model confirms both direct and indirect performance gains through streamlined workflows, reduced errors, and optimised resource allocation. These findings offer actionable strategic insights for corporate leaders pursuing efficiency-driven accounting strategies in emerging markets.