Computerized Accounting System
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A computerized accounting system provides businesses with an efficient way to manage finances digitally. It automates processes like data entry, document production, and account updates that were previously done manually and prone to human error. While an initial investment, accounting software offers advantages like speed, accuracy, real-time information access, and cost savings over time compared to traditional paper-based systems. Potential downsides include upfront software and computer costs, reliance on technology functioning properly, increased needs for security and training, as well as a learning curve for new users.
Computerized Accounting System
- 2. Computerized Accounting System A Computerized Accounting System is now a basic necessity among businesses. In the past, accounting was done manually by business owners. The process proved time-consuming AND OMIT human error.
- 3. MOST FREQUENTLY USED SOFTWARES There are a lot of top accounting software available in every category. So, it is not easy to select the best ones. Below are top five accounting software in every category. A. business/personal accounting software: 1. Peachtree (Best Software) 2. MYOB Plus for Windows (MYOB Software) 3. Peachtree Complete Accounting (Best Software) 4. QuickBooks Online (Intuit) 5. Small Business Manager (Microsoft) B. Low-End Accounting Software: 1. Business Vision 32 (Best Software) 2. MAS 90 & MAS 200 (Best Software) 3. QuickBooks Pro 2003 (Intuit) 4. ACCPAC Pro Series (ACCPAC International) 5. Vision Point 2000 (Best Software)
- 4. C. Middle-Market Accounting Software: 1. ACCPAC Advantage Series Corporate Edition (Best Software) 2. Great Plains (Microsoft) MAS 90 & MAS 200 (Best Software) 3. Navision (Microsoft) 4. SouthWare Excellence Series (SouthWare) 5. SYSPRO (SysproUSA) : 1. Axapta (Microsoft Software) D. High-end accounting ERP Market 2. e-Business Suite (Oracle) 3. MAS 500 (Best Software). 4. Solomon (Microsoft) 5. ACCPAC Advantage Series Enterprise Edition (Best Software)
- 6. MAJOR ROLES OF COMPUTERIZED ACCOUNTING Material Management Purchasing / Receiving / Stores Production Manufacturing Support - Production Planning, Quality control, Maintenance Marketing Distribution Personnel Finance Information - Accounting /Computer Services Materials Labour Capital Information
- 7. MAJOR ADVANTAGES Speed – data entry onto the computer with its formatted screens and built-in databases of customers,supplier details and stock records can be carried out far more quickly than any manual processing. Automatic document production – fast and accurate invoices, credit notes, purchase, printing statements etc all done automatically by softwares. Accuracy – there is less room for errors as only one accounting entry is needed for each transaction rather than two (or three) for a manual system. Up-to-date information – the accounting records are automatically updated and so account balances (e.g. customer accounts) will always be up-to-date. Availability of information – the data is instantly available and can be made available to different users in different locations at the same time. Current time information – reports can be produced easily which will help management monitor and control the business,
- 8. Legibility – data is easy to read.the onscreen and printed data should always be legible and so will avoid errors caused by poor figures. Efficiency – better use is made of resources and time; cash flow has improve through better debt collection and inventory control. Staff motivation – the system will require staff to be trained to use new skills, which can make them feel more motivated. . Cost savings – computerized accounting programs reduce staff time doing accounts and reduce audit expenses as records are neat, up-to-date and accurate. Reduce frustration – management can be on top of their accounts and thus reduce stress levels associated with what is not known. The ability to deal in multiple currencies easily – many computerized accounting packages now allow a business to trade in multiple currencies with ease. Problems associated with exchange rate changes are minimized.
- 9. SYSTEM REQUIRMENT Peachtree minimum system requirements include at least a 1 GHz processor and 512 MB of RAM for a single user installation of Peachtree. Sage suggests 1 GB of of free disk space, Internet access, Internet Explorer 6.0 and at least Windows 2000 SP3.
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- 13. DISADVANTAGES OF COMPUTERIZED ACCOUNT SYSTEM Cost When using accounting software, you must buy the software and any additional licenses necessary for other users and computers. Some software requires you to purchase upgrades or updates for additional features. You must also ensure your computer is capable of running the software. If not, you'll need to upgrade your computer as well. Dependent on Computers If your computer crashes or data is corrupted by a virus, you won't be able to use your accounting software until the problem is fixed. This also means you won't have access to any entered data until the computer is running again. Your data can also be corrupted, meaning you will have to re-enter information unless you've backed up your files. In addition, if there's a power failure, your software will be unusable unless you're on a battery-powered laptop. Fraud Accounting software data requires extra levels of security to prevent problem like fraud and embezzlement. Software makes it easier for users to alter data, making fraud easier to accomplish. As a result, there is an increased need for internal auditors to check for any data inaccuracies. Security measures must also be taken to limit the amount of control users have over any accounting software's features.
- 14. Additional Software Most accounting software requires you to have additional software in order to view reports. For instance, some programs allow you to export data as a PDF file or an Excel spreadsheet. This allows users without the accounting program to view the data. However, the viewing software may pose an additional expense to the user. Human Error While it is easy to write down numbers incorrectly, it is even easier to mistype a number. Entering data into accounting software too quickly may result in serious errors. With the program performing calculations, it can be more difficult to trace the cause of the problem. Spreadsheets, digital ledgers or written ledgers make tracking simpler and faster. Training Accounting software requires you to take the time to learn how to use it. While you may be an experienced accountant, you'll still need to learn what each button and menu command does in order to use accounting software effectively. This learning curve can result in costly errors. In some cases, paid training may be necessary to learn how to perform certain tasks. If you're not tech savvy, the process could be
- 15. Time Many accountants find that it takes more time to enter data into accounting software than it does to write it or type it into a spreadsheet. Due to step-by- step screens, the process often takes longer, especially for those who don't use the software often or are still new to using the program. If the software requires numerous steps to enter basic data, the time requirements may outweigh the benefits of automatic calculations Maintenance Maintaining accounting software not only includes performing upgrades to the accounting software package, but also maintaining and upgrading all the necessary equipment to utilize the accounting software as new versions can require upgraded equipment. That equipment often includes your PC or laptop, monitor, printer, Internet connection and modem, backup drive and operating system. If you do not wish to spend the time and money to keep your equipment in compliance with the accounting software, it is best to stick to spreadsheet or ledger accounting.
- 16. Disadvantages of manual accounts system Time consuming It is much more time consuming than the computerized one. More error possibilities Because of manual doings this sytem have more error omitting possibilities. Less efficient It is much inefficient than the computerized one. Slower access to the data Less current time availability Require physical space for storage Much more cotly Large number of staff required Mostly Illegible Problem in finding the mistake