The test, which assesses how well a child can identify sounds and words, takes about 10 minutes to administer. It could also be a "red flag" for dyslexia.
Mr Hantz said whilst it was important to monitor a student's progress, educators needed to be wary of restricting a child's learning through predictive tests.
"We might end up putting a glass ceiling on children achieving even higher."
Dr Carson's supervisor, UC's College of Education pro vice-chancellor Gail Gillon, said the test could predict with 92 per cent accuracy a child's reading ability one year after it was taken.
During the phonological test, children were talked through different activities by a female voice and asked to match pictures with their corresponding sounds.
"There might be a slide of a dog and they have to find the other picture that will come up on the screen that will start with the same sound that 'dog' does," Professor Gillon said.
And because it assessed a child's phonological awareness, the test could also be an early indicator for dyslexia, estimated to affect 7 per cent of Kiwi children.
"One of the strong features associated with dyslexia is a phonological awareness difficulty," Professor Gillon said.
"As an early screen it would be one red flag [for dyslexia] ... but it would need to be looked at in conjunction with other things."
The test had been taken by children as young as 3 years and also those with disabilities.
"It is designed to pick up children of all levels who are struggling."
The computer trial last year involved 95 year one pupils who were measured for reading fluency and accuracy six months and 12 months after they took the test.
The six-month results were 94 per cent accurate, which was even better than the 12-month results, said Professor Gillon.
Researchers hoped to release the programme free to schools once it was finalised.
WHAT IS DYSLEXIA?
A learning disability that makes it difficult to learn to read, write or do number work
Estimated to affect about 7 per cent of students
Occurs in people of all backgrounds and intellectual levels
No known causes, but research shows it often runs in families
Famous dyslexia sufferers include Albert Einstein, Muhammad Ali, Walt Disney and Tom Cruise
- Source: Speld NZ