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Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
Computerized acc
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Computerized acc

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  • 1. Computerized Accounting BY K. VENKATA RAMANA LECTURER, MBA DEPT.,GIACR RAYAGADA
  • 2. Computerized Accounting:  Accounting is a formal method used by businesses to collect, organize, process and summarize data for reports and statements. Accounting is used to keep track of business trends and to report relevant facts within the business. Computer and business software allow more efficient processing and organization of data. Computerized Accounting is software that runs on a computer equipment to record, store and analyze information on financial transactions from internal and external operations of both small and large businesses. Financial reports are automatically generated at the end of each accounting period of a given company. The computerized accounting eliminates paper work making it easier and faster to collect, store and trail all transactions as they occur.
  • 3. Benefits of Computerized Accounting System: Performing business accounting on paper ledgers is an extremely complicated process. Business accountants must track endless details such as an operating budget, accounts payable and receivable, taxes and other expenses and compliance with governmental regulations, just to name a few. Even in a small business, manual accounting can quickly overwhelm one person, and a full-time accounting staff is not inexpensive. For simplicity, cost reduction and peace of mind, consider switching to a computerized accounting system. A computerized accounting system has many benefits, including:
  • 4.  Improved Reporting To Financers - many projects have more than one funding source, each with specific and different requirements such as: assisting with compliance with charity regulations, etc.  Minimal sign Mathematical Errors - with computers doing the mathematics, errors are virtually eliminated (unless the data is keyed in improperly in the first instance).  Better Record Keeping - whilst human error can still corrupt your data e.g. entering figures in wrong fields, a good package will reduce this possibility and ensure that there is a reference for all transactions e.g. for every cheque or receipt entered/created. However, this does not eliminate all manual work. Vouchers, invoices, receipts etc. will still need to be filed in a logical order and details of what was entered onto the system should also be recorded on paper. This will help when you need to track errors, in the annual audit and if disaster strikes and you have to re-enter all transactions.
  • 5.  Automated Report Generation - Accounting software has the ability to generate reports on demand--something that could take a team of humans hours or days. These reports can be customized to what the company is spending money on, such as rent, day-to-day operations, salaries and marketing. In addition, when used properly, this feature can assist the business in its budgeting needs, telling executives in a quick and easy to use format exactly where their money is going. Reports empower executives to make informed decisions, and having instant access to them can only make success more likely.  Data Security - For record-keeping and compliance with the law, businesses often must keep financial records for years. It is extremely difficult to keep copies of paper records in multiple locations, and a catastrophic incident that results in the destruction of paper records can damage a business in many ways. With a computerized accounting solution, files and important financial information can be stored online or on off-site data cartridges--or both--giving a business the level of redundancy that it needs to recover from a catastrophe and ensuring compliance with all applicable data retention laws.  Faster and efficient in processing of information;
  • 6.  Saving Time - with fewer errors and the software automatically generating reports, time will be saved in the long run.  Saving Money - even though there will be the immediate cost of the software, you are potentially saving the costs of unnecessary audits as well as saving money through time saved.  Limiting Human Error - The biggest advantage of accounting software for businesses is that most software available has an automated system that checks for mathematical errors. Errors in accounting can occur easily when done by hand. When errors do happen, they can create chain reactions that cost a company untold amounts of money and time as they must determine how the error occurred, what other areas of the business's finance it affects and how to prevent similar errors in the future. Having a system that is fully automated reduces the possibility for human errors.
  • 7.  Lower Cost - Accounting can become expensive for businesses, as the level of work can result in the businesses needing to hire an accounting service on contract or hire several full-time employees. Accounting software eliminates much of the manual work, which may allow you to reduce your full-time staff and lower your costs. Indeed, because so many tasks can be automated, a full-time accountant may not be necessary at all.  With the larger reductions in the cost of hardware and software and availability of user-friendly accounting software package, it is relatively cheaper like maintaining a manual accounting system;  More timely information can be produced;  No more manual processing of the data- all automatically been posted to the various ledgers/accounts and  Many types of useful reports can be generated for management to make decisions.

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