Accounting Information Systems pdf

Accounting Information Systems Chapter 7 Describe an effective accounting information system. Objective 1 Control Compatibility Flexibility Cost/benefit relationship Basic Features Basic Features ✔ Internal controls are the methods and procedures used to authorize transactions and safeguard assets. ✔ Compatibility means that the system works smoothly with operations, personnel, and the organizational structure. Basic Features ✔ Flexibility relates to the system’s ability to accommodate changes in the organization. ✔ A cost/benefit relationship indicates that the cost of controls do not exceed their value to the organization. Company Personnel Hardware Software Computerized Accounting System Computerized Accounting System ✔ Hardware is the electronic equipment that makes up a computer system. ✔ Software is a system of instructions that drive the computer to perform various functions. ✔ Properly trained personnel are critical to the successful operations of the system. Objective 2 Understand both computerized and manual accounting systems. Processing Input (Source documents) (Financial statements) Output Three Stages of Data Processing Computerized Accounting System entered, edited printed to paper, screen ACCOUNTING RECORDS Journals, Ledgers, Other records SOFTWARE PROCESSING PERSONNEL input transactions, request reports, protect records REPORTSDATA INPUT OUTPUT posted accessed for reports HARDWARE [...]...Designing an Accounting System Design of the accounting system begins with the chart of accounts The chart of accounts lists all accounts and their account number in the ledger Menu-Driven Accounting System Computer systems are organized by function or task Computer systems usually have a choice of processing options on a “menu.” Menu-Driven Accounting System General Receivables... of Cash Flows Use arrow keys to make choice Press to access choice Press F7 to leave menu REPORTS Objective 3 Understand how spreadsheets are used in accounting Integrated Accounting Systems Computerized accounting systems are organized by modules These modules are separate but integrated units A sales transaction entry will update two modules: 1 Accounts Receivable/Sales 2 Inventory/Cost... Menu-Driven Accounting System General Receivables Payables Inventory Payroll Reports Utilities Posting Account Maintenance Closing COMPUTERIZED ACCOUNTING SYSTEM Use arrow keys to make choice Press to access choice Press F7 to leave menu MAIN Preparing Accounting Reports Trial Financial Accounts Accounts Daily Cash Balance Statements Receivable Detail Payable Detail Report Income Statement... 60,000 4 Net Income 40,000 5 Cursor is on cell B4 C Objective 4 Use the sales journal, the cash receipts journal, and the accounts receivable ledger Special Journals What are special journals? They are accounting journals used to record one specific type of transaction What are some examples? Sales Purchases Cash Receipts Payroll Cash Disbursements Using the Sales Journal Sales Journal Date Jan 2 Jan . Accounting Information Systems Chapter 7 Describe an effective accounting information system. Objective 1 Control Compatibility . REPORTS Objective 3 Understand how spreadsheets are used in accounting. Integrated Accounting Systems ✔ Computerized accounting systems are organized by modules. ✔ These modules are separate. an Accounting System ✔ Design of the accounting system begins with the chart of accounts. ✔ The chart of accounts lists all accounts and their account number in the ledger. Menu-Driven Accounting