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Accounting information systems exploration paper

Systems Analyst, Details Systems, Products on hand System, Biometrics

Excerpt by Research Paper:

Components of an Accounting Information System

Accounting Information Systems

An accounting info system is a vital tool for any organization. The program will support the organization to make critical tactical and organization decisions. Creating a system that captures, records, processes, and records economical data to get an organization will also reduce errors in billing and shipping and delivery. This conventional paper analyzes the six main components of an accounting information system.

An accounting information system is a course that is used inside an organization pertaining to the collection, recording, storing, and processing accounting data to be able to produce information that will assist in decision making Lounge, 2011.

The management uses an accounting information program to better be familiar with organization’s budget. This will assist them to make strategic and business decisions for the business. The system contains a set of included components, which will interact with each other in order to achieve a goal. This product is mostly pc based, and it tracks all accounting activities, which will ensures that there is certainly accuracy in most financial deal of the firm. The system as well makes financial data to become readily available to people authorized to get into it, and keeps the data secure Gelinas, Dull, Wheeler, 2010.

Studies produced from the machine are normally used for internal functions by the managing, and outwardly by collectors, investors, or perhaps tax specialists.

Accounting info systems had been previously developed by the organization, which in turn made these people hard to formulate and maintain. Currently, these systems are built and sold as software packages by companies like Sage, SYSTEMS APPLICATIONS AND PRODUCTS, Microsoft, and Oracle. This makes the systems easy to use and less expensive to keep up as the businesses will change them to suit the organization’s business processes. The necessity to have online connectivity with other business systems led to the blending of accounting information devices into bigger, and more centralized systems just like enterprise source planning (ERP). This guaranteed there was on-line and debt consolidation of the devices.

Without integration, an organization must develop extrémité that allow the systems to interact with each other. Incorporating the accounting data system as a module within an ERP ensures that interaction can be in-built, and the modules can access the same info. This makes sure that data is streamlined, and there is little place for problems.

An accounting information system comprises of 6 main parts namely people, software, info, procedures and instructions, interior controls and information technology facilities.


Like a component of accounting information devices, people make reference to the system users. These are the pros who have to work with the organization’s accounting information system. They will include accountancy firm, business analysts, consultants, auditors, chief monetary officers, and managers. The machine will also assist to interlink different departments within the organization. Relating to Romney and Steinbart (2010)

this will likely ensure that all the functional departments within an organization can get the system, and there will be a centralized program that handles the organization’s accounting. The employees will be necessary to use the system and type all buyer orders, and inventory requests, which will allow for easy receipting and charge of the accounting function. The accounting information system is developed with people at heart. It should generate their work easier, and improve their production. It should certainly not hinder these people in any way.

For instance , the company management can set goals to get sales inside the system. This will likely require the sales staff to make requests from inventory, which will inform the accounting department of new payables. Following your sales are produced, the sales people will enter the customer purchases in the program. Accountants will then invoice the customers and notify the factory. The warehouse will gain access to the system and assemble the orders, that the shipping section will send. The client service division will use the system to check on the progress of customer orders and shipments. The system has capabilities intended for generating reports that the management will use for decision making. Through the system, the manager will likely see the costs for manufacturing, inventory, and shipping.

Anyone who is authorized to reach the system can get information with regards to their specific needs or perhaps requirement. Individuals that need data from the corporation like consultants, auditors, and tax authorities will use the program in order for them to gain access to the relevant information. Consultants are able to use the information within an accounting data system when analyzing the performance from the company to ascertain its success. Auditors will use the accounting information system to analyze the organization’s finances, compliance with the law, as well as the organization’s inner controls.


As a component of accounting info systems, software is the computer program that is used intended for storing, retrieving, processing, and analyzing the organization’s financial data. Prior to the advent of personal computers, accounting data systems accustomed to be devices that were paper based. Nowadays, companies are using computer programs for all their accounting purposes. There exists a range of applications that are suited to small and medium sized organizations, which means that a company should examine its should establish the best system that will suit and satisfy its requirements Ingram Albright, 2006.

Security, reliability, and top quality are the key components intended for an effective accounting information program program. Since the organization’s management will use information through the program for making strategic decisions, there is requirement of a high quality of information in order to make sound decisions. The accounting details system allows the company top managing to access the relevant reports necessary for decision making. The management also can query the machine as it provides in created search service. Using this software program feature will enable them to search for certain information.

The software program programs are normally customized to be able to meet the certain requirements from the organization. Organizations that do not find software program that fulfills their unique needs will have to develop the program under one building. This development means that the organization’s users will have to provide substantial input. Publicly traded businesses have to make use of programs that meet stringent regulations. These regulations establish auditing types of procedures and internal controls to get the program, as well as the organizations need to adhere to these types of regulations.


The financial information strongly related the organization is definitely contained in the accounting information program. All organization data which usually impacts the organization’s budget should be created the system Larson, Wild, Chiappetta, 2004.

This will likely ensure that most data can be processed, and preparation of accounting claims and information is easier. The information that makes up an accounting information program include customer billings, sales orders, purchase requisitions, vendor invoices, products on hand data, standard ledger, payroll, tax info, and timekeeping.

Keeping this kind of data inside the system allows an organization to manage its revealing, recordkeeping, evaluation, decision making, and auditing actions. The data must be relevant, full, and appropriate for it to benefit the business. Therefore , almost all data entrance activities needs to be verified and validated. This will ensure that the info captured inside the system is right and contains no errors. Validating the data helps prevent any blunders from occurring since the info is used for sensitive and crucial decision making.

Accounting info systems procedure highly hypersensitive data to get an organization. The information entered into the machine is used in assisting the organization’s managing to make proper and business decisions. Coming into correct info into the method is a priority because this makes sure that reports made contain the appropriate data and indicate the correct situation. The data entered into the machine is used to get various uses. Therefore , its accuracy will ensure that billings, consideration statements, financial information, and tax details are correct.

Not all data should be entered into the system. It is because data that is not part of the economic records in the organization like manuals, presentations, and memos have no effect on the organization’s finances. The documents might have some marriage with the organization’s finances, nevertheless they have no bearing on the overall finances with the organization.

Techniques and recommendations

The techniques and recommendations for a great accounting details system include all the methods that the system will use to gather, store, access, and procedure data Albright Ingram, 2003.

The methods employed can be both manual or automated depending on organization’s choice. The data can normally come from internal and external resources. Internal options will be staff, and exterior sources from customers inserting orders. Personnel will get into customer details and purchases. Customers will certainly place purchases either on the web or through email, which may have to be captured into the system for digesting. Procedures and instructions will be hard coded into the accounting information program, and the same should be trained to employees using recommendations, training, that help documentation. The documentations will allow employees to understand how data is captured, processed, and retrieved in the system. Staff training must be conducted when the system is presented, or as it is been set up. Training will permit employees to familiarize themselves with the program, and start making use of the system. There ought to be a trained professional who helps the employees through the initial period of making use of the system. The professional will guide employees in case of any difficulty, and demonstrate

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Category: Accounting,

Topic: Accounting Information, Accounting information system, Decision making,

Words: 1696

Published: 12.26.19

Views: 351

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