C.W Comp Acc II Beck

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INTRODUCTION The evolution/development of accounting software was through a big process as well as so many advancements and adjustments. It therefore took time to realize their global application in all organizations. These accounting softwares have had big contributions among which there is increased accuracy, speed of work to mention but two. After the development of, Internet, E-commerce and technology in general, more and more developments have been realized in the contemporary world of business. Organizations have changed the way they do business; methods of employee payments have changed as well as improvements in the international accounting standards. This tremendous development has forced organizations to change the way departments do operate. It is there for important to note that the accounting section has not been left behind as well. Originally accounting was done manually, but due to its associated disadvantages like tedious work, constant errors and other related mistakes, the way accounting was done has changed. This has lead to the development of computerized accounting systems that came with the development of accounting software that would automatically do most of the work. 1

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Transcript of C.W Comp Acc II Beck

INTRODUCTION The evolution/development of accounting software was through a big process as well as so many advancements and adjustments. It therefore took time to realize their global application in all organizations. These accounting softwares have had big contributions among which there is increased accuracy, speed of work to mention but two. After the development of, Internet, E-commerce and technology in general, more and more developments have been realized in the contemporary world of business. Organizations have changed the way they do business; methods of employee payments have changed as well as improvements in the international accounting standards. This tremendous development has forced organizations to change the way departments do operate. It is there for important to note that the accounting section has not been left behind as well.

Originally accounting was done manually, but due to its associated disadvantages like tedious work, constant errors and other related mistakes, the way accounting was done has changed. This has lead to the development of computerized accounting systems that came with the development of accounting software that would automatically do most of the work. However, they are as well associated with some shortcomings as well that have retarded there efficiency in some organizations among there is the desire for technical knowledge for effective use especially when it comes to developing countries where technology is just being developed.

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OVERVIEW OF ACCOUNTING Accounting is a body of principles and conventions as well as an established general process for capturing financial information related to an entity's resources and their use in meeting the entity's goals. Accounting is a service function that provides information of value to all operating units and to other service functions. Accounting is an Umbrella term encompassing the multitude of disciplines including auditing, taxation, financial statement analysis, and managerial accounting. Accounting-related functions include financial accounting, cost accounting, and financial planning.

FIELDS/BRANCHES OF ACCOU NTIN G The following are the branches of accounting: Management accounting According to the Chartered Institute of Management Accountants (CIMA), Management Accounting is "the process of identification, measurement, accumulation, analysis, preparation, interpretation and communication of information used by management to plan, evaluate and control within an entity and to assure appropriate use of and accountability for its resources. Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies and tax authorities" (CIMA Official Terminology). Financial accounting The financial accounting is guided by various rules and regulations, some of which are mandatory. The system cannot normally deviate from the accepted accounting practices. The object of financial accounting is to provide information mainly to outsiders such as shareholders, investors, government authorities, financial institutions and so on. The analysis and interpretation of financial data contained in the income statement and the balance sheet enable persons interested in the business to make meaningful judgment about the profitability, liquidity and solvency of the enterprise.2

Cost accounting basically relates to the utilization of resources, such as material, labour, machines, etc. and provides information like products cost, process cost, service or utility cost, inventory value among others so as to enable management taking important decisions like fixing price, choosing products, preparing quotations, releasing or withholding inventory and so on.

Tax accounting is the branch of accounting relating to preparation and filing of tax forms with government agencies. Tax planning to minimize tax payments is a significant part of the tax accountants work.

Auditing is the branch of accounting involved in reviewing and evaluating documents, records, and control systems. Auditing may be external or internal.

DEFINITIONS OF KEY TERMSComputerized Accounting

Computerized accounting is a beneficial use of current technological advances. Not only has it revolutionized the traditional paper methods of accounting, but it has also created new types of accounting applications for business. Companies now create entire accounting information systems that integrate all business operations, including external suppliers and vendors in the value chain. Computerized Accounting System A computerized accounting system is a system used by businesses for recording their financial information. Many systems are available and companies look for a system to match their needs. Information System An information system is any combination of information technology and people's activities that support operations, management and decision making. In a very broad sense, the3

term information system is frequently used to refer to the interaction between people, processes, data and technology. In this sense, the term is used to refer not only to the information and communication technology (ICT) that an organization uses, but also to the way in which people interact with this technology in support of business processes.

Accounting Information System - AIS This is the collection, storage and processing of financial and accounting data that is used by decision makers. An accounting information system is generally a computer-based method for tracking accounting activity in conjunction with information technology resources. The resulting statistical reports can be used internally by management or externally by other interested parties. Accounting Software This is a Computer programs that assist bookkeepers and accountants in recording and reporting on a firm's financial transactions. The functionality of accounting software differs from product to product. Larger firms may choose to implement a customized solution which integrates a vast amount of data from many different departments. Smaller firms often choose an off the shelf.

HISTORY/OVERVIEW OF ACCOUNTING SOFTWARES The history of the first computerized accounting system was also implemented in 1953, when Arthur Anderson Consultancy (now known as Accenture) was asked by General Electric to implement an automated payroll processing system at their site in Louisville, Kentucky. The system comprised of a UNIVAC 1 (UNIVersal Automatic Computer-1) computer and printer. It was the first ever commercial computer system ever implemented and became the first ever computerized accounting system. The first computerized spreadsheet appeared in 1961 whilst the first 'off the shelf' accounting auditing system appeared seven years later in 1968. The first ever micro-computers started appearing in the mid 1970s. At first these were expensive, cumbersome and of limited benefit to small or medium-sized businesses. Micro-computers were perceived as being an expensive hobby toy with limited benefits. Where micro-computers were4

used in business, it was typically used for word processing and word processing systems sold for around 10,000 per system. In 1978, two things happened in history. The Intel 8080 processor and the MOS 6502 processor became available significantly bringing down the cost of micro-computers, Apple launched the Apple II micro-computer, and the first commercially available off-the-shelf spreadsheet package was developed: VisiCalc.

TYPES OF ACCOUNTING SOFTWARES As emphasized by Weaver, Brower and Smiley (1988:520) many software programs are available to handle the tasks and procedures involved in the accounting subsystems. Some major types of accounting software and the features and capabilities commonly found in these programs are described as follows; General ledger software The general ledger from Weavers point of view is at the heart of every accounting system be it manual or computerized. A general ledger program can be used to create and maintain that of accounts and the general ledger to record and post journal entries and to prepare financial statements. Because posting is done automatically on a computer, the balances in the ledger are always current Weaver (1988:521) notes that, a trial balance and financial statements can be generated instantly without having to do manual calculation. Many general ledger packages allow a variety of reports to be generated that helps managers evaluate the financial performance of their businesses. Its important to note however that, as with all accounting softwares, the output generated is only accurate as the date that was entered. Weaver, Brower and Smiley (1988:521) add that, a generate ledger program may be all that is required by a small business. However, if a firm has large numbers of general ledger accounts and a wide variety of transactions, it will need to use subsidiary ledger and special journals.5

In that case, a business may use other programs together with general ledger software. Accounts receivable software With this software, Weaver, Brower and Smiley (1988:521) assert that, information about a companys credit sales and cash receipts can be recorded and reports involving these transactions can be generated. Features of accounts receivable software differ, but most programs allow the user to record entries involving credit sales and cash receipts, maintain an accounts receivable ledger and generate a variety of reports. For instance, a program may produce sales analysis reports showing which customers are buying particular items or sales returns reports that analyze what items are being returned. The software may print customer lists and mailing labels, maintain customers credit information, and create as schedule of accounts receivable. Therefore in this case, because reports can be generated automatically with the software, management can receive sales and credit information quickly hence being able to analyze and act on information in a timely manners. Sales invoicing If a sales invoicing program is used, it is generally integrated with accounts receivable. The major task of a sale invoicing program is to generate invoices and statements of account. Thus when the necessary data is entered a sales invoicing program can automatically computer with prices and extensions and any sales communication sales taxes shipping charges or discounts involved in the sale. Sale on voicing program many prefer other tasks associated with sales such as producing credit memorandums, maintaining a back order file, or generate lists of product lines. Accounts payable software Weaver (1988:522) and the colleague Brower and Smiley lament that, accounts payable

software handles the activities involved with purchases of supplies and merchandise an account6

and payments for those purchases. Typically accounts payable software allows user to record transaction involving purchases and payments on account, maintain an accounts payable ledger, generate cheques for payments and maintain a cheques for register, some systems generate purchase orders. Many accounts payable system indicates when invoices must be paid in order to take advantage of discount periods, and will automatically track discounts earned or lost. And with this feature, management can easily determine whether it is taking full advantages of discounts. Inventory software Weaver (1988: 523) asserts that, inventory software is available that automates many of the procedures involves in inventory control. For example, some inventory programs keep track of merchandise items by age which is important information to a business that stocks merchandise that decreases in value sales times and provide items-by-items sales analysis. Many keep track of the minimum number of units of an item that must be kept on hand and show when items must recorded. Perpetual inventory records can be kept on a computer so that when physical inventory is recorded the program does an automatic comparison of the figures in the sales of records. Some businesses obtain sales or purchase programs that handle some tasks that can be performed by inventory program, or, a business may have an inventory program that is integrated with its sales and or purchase program. For example when a purchase of merchandise is recorded the increase in merchandise automatically appears in the inventory records, thus when a sales of merchandise is recorded, the items are subtracted from the records. Payroll software It should be kept in mind that. Payroll work required performing a mind range of activities and involves a great deal of time in recording information, preparing forms, and making calculations.

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Therefore, computerizing a payroll system can be very beneficial to a company since it cuts down on the time required for payroll work. Weaver or Salaries based on various plans such as hourly, weekly, salary, commissions or automatically, as well as federal, state and local tax, deductions and voluntary deductions such as saving bonds and Union dues. Many payroll program print payroll cheques. A payroll program many be integrated with the generated ledger system so that the necessary accounting entire are automatically posted to the general ledger. ACCOUNTING SOFTWARE COMMONLY USED Accounting software is a boon for so many modern business organizations. These help accountants maintain the accounts - whether personal or for our business. However, with so many options available in the market, it sometimes becomes very difficult to choose the right accounting software package that will be perfect for the accountant as well as for the individuals. Hopefully, this review will help you narrow down your choices. Peachtree This software comes in different flavors depending on the number of users. Between Peachtree Pro, Peachtree Complete, Peachtree Premium and Peachtree Quantum buyers can choose from among several features, depending on what they specifically require. Of these, Peachtree Premium and Peachtree Quantum also have Accountants Editions, which can prove to be of great use for professional accountants. Added to these are several accounting and business management tools, reports customized for industry specific needs, and even payroll management solutions - you have a complete accounting software package that is just right for your pocket as well. QuickBooks A very popular choice of accounting software for personal and professional accounts management, QuickBooks offers something for everyone. QuickBooks is offered in versions Simple Start, Pro and Premier. There is also a free version of the software available for download8

from the website, and an online version of the software which you can access via the Internet. There is also a Premier version specifically for Accountants. Each of the versions offers a number of features - typically a simple and intuitive interface, access to several reports, payroll and even tax management. MYOB This is another popular choice across the board for individuals, small businesses and accountants. A cross-platform software package, MYOB offers the versions Premier Accounting and Business Essentials for Windows users, and Account Edge, First Edge and Checkout for Mac users. Typically the features include invoicing, banking, contacts management, payroll management, inventory management, time billing, purchase management, and over 200 different reports. Microsoft Accounting Express Microsoft offers an accounting suite that integrates seamlessly with your other Microsoft products, while allowing you to manage your accounts, invoices, payrolls and even accept credit cards. You can also track your billable time, create quotes and invoices and custom create your reports from 50 available templates. Net Suite This is an online accounts management system. There is no software to download and install because it is web based. The website offers different roles for managing accounts, along with a variety of reports and tools for managing accounts receivables, accounts payable, payroll and inventory management along with time billing, costing and banking functions. A good option if you dont want to install another software package on your computer and want to be able to access your accounts via the Internet. Fresh Books This is another web-based accounts management system. Fresh books offers several features like invoicing, time tracking, estimate creation, tracking of expenses, and client and staff tracking9

among others. You can have either a free account with Fresh Books or a paid account depending on the number of contractors you want to add. FreshBooks also offers branding solutions helping you create an interface which is in line with your logo and company colors. Bookkeeper This is a software package offering a complete suite of accounting features like integration with banking, expense tracking, payroll management, creating customized invoices, credit card payment processing, and over 125 custom reports. An additional purchase of Tax Table Updates enables you to automatically calculate your taxes and deductions. DacEasy DacEasy is a fairly good accounting software package which offers the typical features and sections like accounts receivable, accounts payable, payroll management, inventory tracking, banking and general ledger entries. A variety of reports from these different sections also allow you to review and manage your business more effectively. CYMA CYMA is also another preferred accounting package. Like several accounting software packages, this software also offers accounts payable and receivables, payroll management, banking integration, job costing and general ledger entries. However, it also offers two sections which are not offered by many other accounting software packages: Purchase Order management and Systems management. However, this software doesnt offer features like inventory and time billing. NolaPro A web-based suite of accounts features, NolaPro offers a number of facilities like accounts payable and receivable, payroll management, order tracking, inventory control, point of sale management, and an e-commerce shopping cart. NolaPro also has a number of plug-in which enhance the functionality of the accounts suite.

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STFB STFB Inc. develops and markets - Integral Accounting Enterprise, a complete accounting & ERP system with source code and distribution rights. Based on ASP.Net, Visual Basic.Net based platforms. Integral Accounting Enterprise is perfect for developers, Consultants, Resellers (VARS) looking for accounting packages to customize and resell to end-users. STFB includes all the standard features like General ledger, inventory control, AR/AP, ordering, purchasing, and payroll, help desk, shopping cart, and reports Pastel Xpress Any company, large or small, has basic accounting needs. Through the automation of common business processes, Pastel Xpress accounting software makes the management of these business accounting needs just as simple! Pastel Xpress is so easy to learn and use, allowing you to confidently steer your business finances. You have the flexibility to add modules to this financial software, making Pastel Xpress a partner that can increase its functionality in line with the growth of your business. Pastel Xpress can accommodate up to three. Tally 9 - Accounting Software Tally.ERP 9 the latest evolution of the Tally seriestook 3 years and the dedicated efforts of 200 developers to create. It has grown from a basic accounting package into a simple-yetsophisticated business management software product. Comprehensive capabilities allow Tally.ERP 9 to meet the needs of small to large businesses with dispersed operations. And traditional functions of a business are handled as capably as the more advanced. The new Tally comes with breakthroughs in collaborative technology that extend a company's capability of managing information across your software applications, across your offices, with the business partners and the managers-on-the-move. This leads to better decisions and improved profits. Other business programs The program describes above are designed specifically are other business programs available that are frequently used by accounting personal. These are as follows;11

Electronic spreadsheet Weaver (19988:523) lament that a spreadsheet can be thought of as a grid. Columns and rows of date can be entered in a spreadsheet and set up in the form of a table. What has made the electronic spreadsheet so popular for business use is its ability to perform large number of calculations and recalculations. The spreadsheet is able to do this by using formulas that the user enters into the computer. These formulas show the interrelationships of the numbers and date enter. Word processing Within a word processing program, one can prepare store and pain all types of written material. A first draft is created and then corrections can be made for typographical errors specifying frunctration, and style. In addition a new format can be created at the touch of the keys; For example if a page has narrow margins and is single spiced, spaced and with wider margins. Thus from the above overview it can be seen that word processing makes writing easier because text can be edited heavily and surprisingly the final printed copy shows no alterations liquid correction flied or erasures. Data bases Weaver (q988:524) defines data base as a group of records that share something in common for example, a customer data base is a group of customer records, and a patient data base is a group of patient records. Data base software helps businesses manager the information contained in their files or data bases. After data bases are created, they can easily be revised and pulled out in alphabetic, numeric, or subject order, or in any other sequence desired. A data base is used to file records for a business and find them again when they are needed. It should be noted that there are so many other commercial software programs available today that most business are able to find packages with the capabilities and features they require.

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DEVELOPMENT/ EVOLUTION OF ACCOUNTING SOFTWARE Over the course of three decades, SAP has evolved from a small, regional enterprise into a world-class international company. Today, SAP is the global market leader in collaborative, inter-enterprise business solutions. The company now employs more than 47 578 people, whose commitment and innovative spirit pace our future success. The 1970s: A Real-Time Vision In 1972, five former IBM employees Dietmar Hopp, Hans-Werner Hector, Hasso Plattner, Klaus Tschira, and Claus Wellenreuther launch a company called Systems Applications and Products in Data Processing in Mannheim, Germany. Their vision: to develop standard application software for real-time business processing. One year later, the first financial accounting software was completed and this formed the basis for the continuous development of other software components. The 1980s: Rapid Growth SAP moves into the company's first building on Max-Planck-Strasse in an industrial park in Walldorf, near Heidelberg. Our software development area and its 50 terminals are all now under one roof. Fifty of the 100 largest German industrial firms are already SAP customers. The SAP R/2 system attains the high level of stability of the previous generation of programs. Keeping in mind its multinational customers, SAP designs SAP R/2 to handle different languages and currencies. With this and other innovations in SAP R/2, SAP sees rapid growth. By the middle of the decade, SAP founds its first sales organization outside Germany, in Austria. The company makes its first appearance at the CeBIT computer fair in Hanover, Germany. Revenues reach DM 100 million (around $52 million), earlier than expected. In August 1988, SAP GmbH becomes SAP AG. Starting on November 4, 1.2 million shares are listed on the Frankfurt and Stuttgart stock exchanges.

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Germany's renowned business journal, manager magazine, names SAP its Company of the Year a distinction we would receive twice more in the next few years. With the founding of subsidiaries in Denmark, Sweden, Italy, and the United States, SAP's international expansion takes a leap forward. The 1990s: A New Approach to Software and Solutions SAP R/3 is unleashed on the market. The client-server concept, uniform appearance of graphical interfaces, consistent use of relational databases, and the ability to run on computers from different vendors meets with overwhelming approval. A growing number of subsidiaries are managed out of Walldorf. The new Sales and Development Center in Walldorf officially opens it doors. It symbolizes the global success of the company. In our twentieth year, our business outside Germany exceeds 50 percent of total sales for the first time. By 1996, the company has earned 1,089 new SAP R/3 customers. At the end of the year, SAP R/3 has been installed in more than 9,000 systems worldwide. SAP celebrates its twenty-fifth anniversary in 1997 and now employs approximately 12,900 people. We continue to strengthen our industry focus and build more and more industry-specific solutions. Henning Kagermann becomes Co-Chairman and CEO of SAP AG with Hasso Plattner. On August 3, 1998, the letters S-A-P appear for the first time on the Big Board at the New York Stock Exchange (NYSE), the largest stock exchange in the world. As the decade draws to a close, Hasso Plattner, Co-Founder, Co-Chairman, and CEO announces the mySAP.com strategy, heralding the beginning of a new direction for the company and our product portfolio. MySAP.com links e-commerce solutions to existing ERP applications, using state-of-the-art Web technology.

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The 2000s: Innovation for the New Millennium With the Internet, the user becomes the focus of software applications. SAP develops SAP Workplace and paves the way for the idea of an enterprise portal and role-specific access to information. Currently, more than 12 million users work each day with SAP solutions. There are now 140,000 installations worldwide, More than 2,400 certified partners, over 25 industry-specific business solutions, and more than 75,000 customers in 120 countries. SAP is the world's third-largest independent software vendor. With service-oriented architecture and the underlying integration and application platform SAP Net Weaver, SAP is providing our customers with solutions for end-to-end business processes. With SAP Net Weaver, your company can integrate people, information, and processes within the company and beyond. To further demonstrate our commitment for ongoing innovation, growth, and market leadership, SAP acquired Business Objects in 2008. Together, SAP and Business Objects, an SAP company, offers the industry's most comprehensive portfolio of business performance and optimization solutions for companies of all sizes. STEPS IN USING ACCOUNTING SOFTWARE Accounting packages are available to make accounting much easier. However, people who have always used manual accounting might be doubtful of transitioning from manual accounting to computer software. Once we discover how helpful computer software can be in keeping track of accounting, we are likely to wonder how we ever lived without the accounting computer software. Here is how to transition from manual accounting to computer software. a) Recognizing the value of handling your accounting through accounting computer software; Computer software can run reports significantly faster than a person can run manual reports. Computer software makes it much easier and faster to reconcile accounts. Computer software

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can also help us set up and track a business budget. If we want to know where every dollar is going, it is much easier to find out by using computer software. b) Exploring available options; Quicken is one of the most popular accounting computer software programs. Other options, such as Microsoft Money, are also available. It is there the role of the systems manager to know each computer software package, what if offers, and decide which one sounds like it will best meet the requirement accounting needs. c) Trying the software before you buy it; many software companies make their accounting computer software available to try for free for a period of time. Take these companies up on their offers. Go to their websites and download the trial software. This gives the user the opportunity to compare and contrast accounting computer software packages as well as to see the difference between using the computer software versus doing your accounting manually. d) Transferring the accounting data for one account, such as a checking account, to the accounting computer software; For 1 month, get in the habit of recording your deposits and checks in the computer as well as your manual accounting system. Be sure to use the computer software to reconcile your checkbook. For many people, simply seeing how easy it is to reconcile a checkbook through accounting computer software sells the software. e) Using the features available for that account; when one writes a check, he/she use the accounting computer software to record what he is spending his money on. At the end of the month, he runs a report to view the cash flow over the past month. Once he has a months worth of data on the computer, he can take advantage of many of the financial reports that the software has available. f) Transition the rest of your accounting data over to the computer software once you are sold on the value of the accounting computer software. Once you do this, you can run a variety of reports that will help you feel much more on top of how you are spending your money. g) Back up your financial data regularly. One big fear that many people have in transitioning from manual accounting to computer software is of losing all of their financial data. Be sure to back up your accounting computer software data onto a disc on a regular basis so you have that data available if your computer crashes.

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ADVANTAGES OF USING ACCOUNTING SOFTWARES Facilitates Auditing activities Many organizations are using accounting softwares to process transactions and design those systems so that service documents are retrievable in readable form and can be traced so easily through the accounting system to output. In these instances, many of the traditional service documents such as customer purchase order shipping and receiving records, and sales. The related accounting softwares such as QuickBooks, Pastel and tally also product printed journals and ledgers that allow the auditor to face individual transaction though the accounting records. Facilitates the organizational attainment of competitive advantage Within the context of information explosion and pressures of the information age more and more organizations are finding themselves investing heavily in computerizing that accounting system. This because they do in order to cope with the volume of required accounting information and the reduction of time within which the information is required. This is unquestionable more acute in profit making organizations compared to service organizations. In this regard accounting softwares therefore help the organization to reap major advantages. For instance with computerized accounting information systems and organization plan better carry out monitoring and control activities move effectively can communicate across time space and organizational hierarchy through the development and proper use different accounting information and communication systems. Thus, from the above explanation, computerized accounting is relevant in the management of the modern organization.

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Supporting management decisions It is understood that accounting softwares facilitate managements decision making process. It is well known that in all businesses management responsibilities entail making a variety of business decisions. Thus computerized accounting provides reports and other information useful in making these decisions. This is so in that formal computerized financial statements provide variety useful information which the managers need. In achieving all these, a computerized accounting system will always be timely and flexible. By being timely to computerized accounting information system can supply information on with sufficient lead time hence permitting management to assimilate and use it in the decision at hand. On the other hand by because of its flexibility a computerized accounting information system can provide information to support new decisions without needing major modifications. All these therefore can provide an immediate solution to the problem of delays in reports in accuracy among other inefficiency which enhances making decisions. Accounting softwares/Computerized accounting can do much to reduce labour and to enhance the value of the information an accounting system generates. It is obvious that by changing the way both operations and accounting objectives are accomplished computers charge the control environment and the way control objectives can be accomplished. This also leaves the senior staff time fixed up to allow focus on planning. For example, since computers are more accurate and faster at authentic than humans most calculations can be incorporated into application programs. This therefore eliminates the need for employees to verify each others calculators the accounting department. Speed and accuracy In this case, it is clear that accounting softwares work very fast and thus can obey without of constructions per second. This can be observed in their accuracy more over most of the mistakes

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that occur in a computerized accounting information systems are human errors which could have resulted from people breeding say; computers with wrong data or his fractions. This therefore, implies that computerized accounting information system can play a big role in fastening transactions in the accounts section hence increasing efficiency in the departments transactions and the whole organization at large. Reduces Embezzlement Computerized accounting software makes it difficult for employees to steal money from the company. For example, if a payroll employee tries to pay herself more than the allowed amount, her theft will most likely be discovered because the accounting system stores all saved transactions Diligence It is absolutely necessary to note that a computers unlike human to note are diligent or reliable in the sense that, they never get tired or more because of lengthy repetitive or monotonous tasks. For example, if a computer is given the task of calculating the payments made a thousand clients or salaries for thousand employees, it will compute the amount of money for each of the clients or employees with the same speed and accuracy. Storage capacity Furthermore, weaver (1988:823) I am.that unlike the human brain or any storage space a computers memory can store vast amounts of accounting and other information or data more over on a small device such as diskette or hard disk. Therefore, because computers can store large amounts of information in relatively small place, it means apparently that computerizing the accounting system can help the accounts department and the company at large to reduce the amount of papers in offices which would otherwise bring congestion. Even, weaver points out that, this excessive amount of papers would also put time offices at a higher risk of five. Besides, a computerized system also makes records easily accessible even to authorized staffs of the company.

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From the above, it can be observed that computerizing the accounting system can help the company particularly the accounts department in bringing its offices nearer to the much desired status of paperless electronic officers. Versatility and automation Accounting softwares being versatile they can perform any tasks provided that these tasks can be broken down into steps (algorithus) that computers can follow. This is where computers when used can work as calculators, records keepers, do graphics and even perform other financial tasks in other financial tasks. In simple words, with computerized accounting, the accountants can manipulate figures numerical figures, do data base management among others depending on different needs of the department. On other hand, it should be noted that, computerized systems are so automatic in that once given a set of data and relevant instructions, they can process information with minimum use intentions in his case, it is apparent that this property of automatically of computerized accounting information system is what distinguishes it from manual accounting systems. Reduced labor Accounting software reduces labor by also performing automatic, preparing documents, creating transaction files, and recording and posting transactions while, employees input only the minimum data to process transaction, in this, it is apparent that the computer period efficiency of a computerized accounting system makes it forcible to integrate accounting records cost effectively say, from the sales and cash receipts cycle and the purchase and cash disbursements cycle thus therefore provides management with greater access to useful information on a timely basis. Through all this, the accounts department and the company a large can perform to the stake holders expectations. Facilitates control on confidential information. When the accounting system is computerized, the control emphasis slots away from separating employee duties and performance many verifications of manual accuracy and is placed on20

ensuring the proper functioning of application programs, using security procedures to limit access to the computer systems application programs and files to authorized employees, verifying the accuracy of input and reconciling outputs to inputs. This entire safe guards the companys information whose leakage would make competitors or hackers to take advantage of the company particularly the accuracy. Improved productivity and creativity When the accounting system is computerized, employees personal productivity is improved because tedious time consuming and repetitive tasks are reduced or eliminated. This can improve the quality of end users work and allows them to perform more complex tasks. In other words on effective and efficient computerized accounting system frees the workers for more creative thought oriented activities and for planning and control activities. This enables them to make better, faster and more accurate decisions. From the above, it is apparent that with a computerized accounting information system employees skills are improved hence resulting into better performance of the department and the organization at large. This is because working in a computerized environment the computer literacy of uses hence allowing them to make better use of current technological advancements. Ease of use In this case, when an accounting system is computerized, it may become so easy for employees to use it and perform tasks everywhere and at all times. Thus, it is obvious that most computerized softwares are easy to understand and use. In this case, users (employees in the accounts department) can change the information they produce or modify their application anytime their requirements change. And with portable computers (laptops) some of the work can be competed at home, on a plane or almost anywhere else. All this results into better execution of the accounting and other tasks expected of the department and organization at large hence gaining a competitive advantage.

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Easy illustration of various changes in the accounts With computerized accounting system, a simple work sheet can be used to illustrate the various changes in the accounts. This worksheet called spread sheet can be used in accounting to perform financial calculations and record transactions. In other words the accounting clerks can use computers to show the effects of business transactions on the basic accounting equation quickly and accurately. Thus if the computerized accounting system is programmed properly all accounts can determine the accounts affected, the amounts involved and whether the accounts are being increased or decreased. Once such data are entered, the computer will automatically calculate the new accounts balances and determine whether the accounting equation is balance. From the avocet it can be seen that when accounting system is computerized verifying the transactions become easy. Reduced audit costs and time spent before releasing an audit report. With accounting softwares, aviators can reduce their costs significantly. These savings result from sing word processing and spread sheets to document their work and to revise the documentation when changes occur improved risk analysis better planning and control of the audit better report content and presentation and enhanced creditability. At first, it used to take auditors hours with manual accounting systems to prepare and foot manual trial balances post adjustments and prepare financial statements and if additional adjustments or changes are made for the case of manual accounting information system the whole process has to be repeated. While with a computerized accounting system an auditor can easily input the working trial balance handle all types of adjustment and reclassification entries and automatically computer the adjusted trial balance. It can also facilitate completion of financial statements and their fool notes and tax return information.

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OBSTACLES/CHALLENGES OR LIMITATIONS TO ACCOUTNING SOFTWARES IN MODERN ORGANIZATIONS Wide variety of applications One of the reasons that computerized accounting system was slow to take hold, and is still difficult to implement successfully in some organizations is that, it supports a wide variety of applications. These range from structured tasks to unstructured ones Besides, the range is so wide that it is almost too simplistic to include these applications under the title of computerized accounting information system this is quite a different with transaction systems such as payroll and inventory processing oriented toward specific well defined methods and procedures. Another reason that computerized accounting system shows to take hold is that, user support for this technology is diffused in most organizations. For instance on accounting department is likely to include hardware and software obtained from several different vendors and the kinds of support for these different prices of equipment and software may vary. Seldom will the support a user feels is necessarily be available. In addition, a direct consequence of this multivendor environment is that the equipment or software may be incompatible especially in the accounts department who want to share hardware software or documents may find that sharing is impossible. Lack of help options for the use Contributing to problems with computerizing the accounting system is the fact that it is often unclear where the end user should go in the organization for help some support may come from the central data processing group and other support may be available from a special computerized accounting support staff but in most organizations there are always fellow employees who develop into self made experts and are quick to off advice. For the above reasons among others most organizations find that they lack consistent policies regarding computerizing the accounting information system. This explains why in most cases,23

the hardware and software available to end users (accountants) may be underutilized why incompatibility problems occur and why many become frustrated and angry with computers. High risk of failure and inconsistencies Some companies computerize their accounting systems to obtain a strategic advantage over their competitors through providing improved financial services that would be impossible without the use of computer technology. However, using such computerized accounting systems does not guarantee such benefits as some applications fail. In this case, it should be noted that, some accounting application programs can be improperly programmed or improperly run, and input data can be erroneous. In such cases, computers given the wrong input data make mistakes and can facilitate fraud at the same incredible speed at which they perform useful tasks this therefore implies that computerizing the accounting system may become more of a liability than an asset in the accounting department. High costs Because of high costs involved in purchasing, main training and designing the software there is always a lack of long-term funding to support computers. Furthermore, computerized accounting information systems are expensive in that, although the cost of computer equipments has dropped dramatically over the years, most organization are now designing larger and more ambitious computerized accounting systems and their cost can run into mutinous amount of money In addition, once a computer system is purchased the costs will have just begun in this case, large professional staffs are often required to keep the system running and maintained and to develop new applications. Moreover, in time the hardware will become absolute and the imprecations that are used to run the computerized accounting system may need to be changed frequently to meet the organization changing needs. All the above circumstances serve to drain the financial resources as the benefits of the system is superseded by the costs.

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Limited privacy of the computerized accounting information Employees in the accounts with computerized system may erroneously believe the accounting information and other confidential documents are safe and private only to be surprised when this information ends up in places or with people they did not intend it to go to. All this is true in cases where there are no effective controls to the system and for case where there are hackers. All this leads to easy accessory to the companys financial information and this can be used to out compete or even defraud the whole organization at large. Thus, in such cases, computerizing the accounting system does not mean a solution to a mess in the accounts department. Limited skills among workers Computerized accounting system may not be relevant in the accounts department especially given the limited skills people may be having as far as computers are concerned. In this, where there is lack of the house information system skills, data presentation and impropriation workers accounts and managers may find it impossible to easily excite tasks using the computerized accounting system. This leads to efficiencies in producing the information needed hence affecting the decision making process. Logic and development errors Because the workers or accountants may have little experience in system development and use, they are likely to make errors and less likely to recognize when they have occurred, the development may solve a wrong problem poorly define system requirements, application of analytical remodel use the wrong software or incomplete or outdate information in developing the accounting system. Usually, these errors may be caused by incorrectly using formulas or software commands. All the above may lead to inconsistent case in the performance of the accounts department and the company at large.

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Duplication of systems and data and wasted resources If the end users of the computerized accounting system are unaware that other users or competitors are aware, similar information needs duplicate systems are most likely to occur. Experienced users may also take one more than they are above to accomplish and so they are likely to end up wasting time and resources. This implies that computerizing the accounting system may become more of a liability than an asset to the department and organization as a whole. Dysfunctional behaviour Some users of the computerized accounting system may go overboard in developing end user systems and the result is a variety of dysfunctional behaviours in other words accounts may develop a computerized system to enhance their power, position or reputation rather them effecting the companys financial tasks. They may develop such a system just in case they need it. Therefore, they may get to the point of analysis proteolysis in which they analyze data to death and are still unable to make a decision. In other words such people may only develop an accounting system to slant things toward a position they may to support. CONCLUSION In a nutshell, accounting softwares have had big contributions among which there is increased accuracy, speed of work to mention but two. However to a greater extent computerized accounting system/accounting softwares is associated with many challenges/problems because it is the people in the accounts department who do the accounts. Besides accounting software is associated with some shortcomings that have retarded the efficiency in some organizations among there is the desire for technical knowledge for effective use especially when it comes to developing countries where technology is just being developed. Thus, if the organization has people who do not know what do and they are using accounting softwares, the errors will be worse than ever before.

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REFERENCES Roman S. (1996) Information Technology for Development Volume 7, IOS Press Tokyo Marshall B. Romney, Paul J. Steinhart and Barry E. (1973), Accounting Information System, 7th edition Cushing, Addison-Wesley. New York Donald J. Guerrieri, Barry Haber and William B. Hoyt (1993), Accounting, 3rd edition Glencoe, USA Robert G. Mary James Jiambalvo and Charles L. McDonald (1995) Accounting. 1st edition, Library of congress Cataloging-in-Publishing Data USA David H. Weaver, Edward B. Braver and James M. Smiley (1988) Accounting Systems and Procedures 5th edition, Library of Congress Cataloging-in-Publication Data, USA Internet: www.pcmrp.com www. daceasy.isasi.com

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