Accounting information system is a type of report, which collects, stores and processes accounting data. These type of information is often presented to the bank, other creditors, investors or tax departments. Accounting information system works together with information technology system. It incorporates traditional accounting services with information technology systems.
General parts/components of an accounting information system:
- IT tools
Accounting information system homework answers should have these components included.
Let’s discuss each of these components in detail:
- People –
This is just the users who are using the system. These “people” could be the accountants, financial analysts, auditors, finance managers or officials, consultants. If an accounting information system is well developed, all the users can get the same information and can use it whenever required.Not only that, it can get the information outside of the organization if needed. For example, when consultants work on it, they are not necessarily part of the organization, but can still use the information to analyze the organization’s financial data.
Again, auditors can use this information to see the company’s current financial situation as well. Also, an efficient accounting information system helps to coordinate with different segments or departments of an organization to work together. Hence, the accounting information system should be planned or designed for the users and according to their needs. Accounting information system homework answers should have this part included in the assignments.
- Process –
The process or procedure can be automatic or manually operated, this is the way the data is collected, saved and processes.The data source can be internal or external. One important thing about the process is that it should be consistent. For storing or saving information generally, SQL or structured query language is used. SQL is a computer language used for databases. Accounting information system homework answers must have this part included in the assignments.
- Data –
This consists of any sort of financial data relevant for a company. The data part will vary with the business type, but in general, it should have – billing statements, sales reports, purchase orders, vendor’s invoice, inventory, payroll and finally tax information.These data of an accounting information system can help the company’s record tracking, report making, auditing and all other financial activities. Accounting information system homework answers should have this part included in the assignments.
- Software –
This is the most important part of a modern accounting information system. Earlier, the system was paper-based and was done manually. But now with the aid of modern software, it is way more quicker and easier. Depending on the business type the choice of the software might be different. The size of the business is also important her.
Like, small businesses can use QuickBooks, Sage Peachtree Accounting, or Microsoft’s Small Business Accounting or any other software according to their requirements. But most of small to mid-sized ones use SAP’s business module software. The large ones use PeopleSoft (Oracle) or Dynamics GP (Microsoft) or Financial Management (Epicor). There are much more to this list getting added every day.
The key to this component is the most efficient AIS software that suits the need of the organization. Also, if the existing ones do not fit the requirement, then the software can be made specifically for the company. There are many sources that can do that for a business.
Accounting information system homework answers must specify the software that is being used and why it is used.
- IT Tools –
This component consists the hardware that is used for accounting information system. Most of them are already a part of the company or the business. But in general, it might include PCs, printers, storage medias, backup power, routers. Hardware should always be upgraded though to avoid system failure.
The basic functions – keep in mind while working on the homework:
An accounting information system homework answers must keep in mind the basic functions of an accounting information system. Which are listed as follows:
- The primary function of an accounting information system is the collection, storing of data in the best possible way that can help the company. All transactions should be recorded and saved carefully. Recording in the journal is the most vital part; the next important thing is transferring and posting the data to the ledgers.
- The second function is applicative, that supplies information to make the financial decision for the company. These might include all types of financial reports and statements that the company has.
- The last one makes sure that all the data and the controls are accurately recorded and then processed.
Why you should study accounting information system?
While doing any assignment on accounting information system, it is important to know why you will study the topic. This will help you do a problem for accounting information system homework answers.
Accounting information system provides updates and information required to know about the long and short term financial situation of an organization or company. This system tracks all the expenditures, analyze them, verify the transactions and all other financial documents. Hence, it makes the system more efficient and makes sure that the due taxes are paid properly.
While doing accounting information system homework answers, you should know and remember these points and consider all the components needed to create a good accounting information system. With the aid of modern technology, this should not be an issue if you know how to operate the relevant software correctly. Also, always stay updated on these soft wares, as they keep getting better every day.