Computerised Accounting System
- A computerised accounting system (CAS) refers to use of computers in performing accounting functions with the help of application softwares i.e. accounting softwares.
- It eliminates necessity to create and maintain journals and legers.
- The basic requirement of CAS are accounting framework and operating procedure. Operating environment is a framework of storage and processing of data in a computerised accounting system.
- Types of hardware and software selected depend on secrecy level, types of users, number of users etc.
- Computerised accounting has far superior features as compared to manual accounting in terms of recording of transactions, generation of reports, adjustment entries etc.
- However in both the systems identification of financial transaction is done by the accountant.
- Advantages of computerised accounting systems include high speed, accuracy, up-to-date information, automated document presentation, scalability, quality reports, etc.
- CAS has many limitations also like high cost of training, staff opposition, system failure, computer frauds and crimes, health problems etc.
- Database is an application that manages data and allows fast storage and retrieval of data, for example ORACLE & SQL SERVER. Database varies with basic requirements like front end i.e., Developer/2000, Visual Basic,etc., and back end interface i.e., Microsoft access, data processing i.e., segregating numbers into relevant groups, aggregating them, taking ratios, plotting, etc. and reporting system.
- Application of computerised accounting system includes Spread sheets, General ledger, Accounts receivable, Payroll software, etc.
- Automation of accounting process implies carrying out the accounting function by means of accounting software where human intervention is minimum.
- Stages of automation involve planning, selecting appropriate accounting software and hardware, preparing chart of accounts, grouping of accounts and generation of reports.
- Grouping of accounts refer to process of coding the accounts in a manner that they appear properly in financial statements.
- Process of grouping involves giving a code to each main head, sub-head and thereafter individual account heads.
- Financial reports can be classified as statutory reports and MIS Accounting software is the application software that records and processes accounting transactions within functional modules.
- It functions as an accounting information system and may be purchased from third party and developed in-house by the company.
- Accounting software packages classified into ready made software, customised software and tailor made software.
- Factors of sourcing accounting software are flexibility, cost of software, size of organisation, reputation of the vendor, fulfillment of business requirements, etc.
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Q1
The need of accounting software arises in-
Marks:1Answer:
When the computerised accounting system is implemented to replace the manual system
Explanation:
The need of accounting software arises in that situation when the computerised accounting system is implemented to replace the manual system.
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Q2
Accuracy and reliability are
Marks:1Answer:
Advantages
Explanation:
These are the advantages of computerized accounting system.
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Q3
Advantage of computerized accounting system is
Marks:1Answer:
Up-to date latest information
Explanation:
Computerised
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Q4
Computerised accounting system has two basic requirements:-
Marks:1Answer:
Both a and b
Explanation:
Computerized accounting system has two basic requirements-
1. Accounting framework
2. Operating procedure -
Q5
Computerised accounting system is based on the concept of:-
Marks:1Answer:
Database
Explanation:
It is totally based on database.