Core Concepts of Accounting Information Systems †Free Samples

Question: Discuss about the Core Concepts of Accounting Information Systems. Answer: Introduction: In the recent era of technological advancements, massive ongoing developments can be seen in the accounting information system that have positive impact on accounting practices. In this context, the name of Enterprise Resource Planning (ERP) needs to be mentioned as an important accounting information system. In the presence of ERP system, the managements of the companies become able to integrate the core business processes like accounting, sales, warehousing and others. There are two types of ERP system available; they are On Premise ERP and Hosted ERP. It needs to be mentioned that ERP system has brought major changes in information technology. As a major change, ERP system collects the shares transactional data of the organizations from various sources so that data duplication can be avoided and to integrate data with a single truthful source. Another technological improvement is the Cloud ERP that runs the entire company on a single cloud-based management suite. In the presence o f ERP system, companies can record all business transactions irrespective of their size and nature (Hall 2012). Due to this system, anytime necessary information can be found in the computer system while required. ERP system makes the process of payment easier for account payable. With the help of ERP system, companies can make payment of the bills with the click of a button. The presence of ERP system helps in the process of easy billing. All the information related to accounts receivable is recorded in the information system to print bills. This can be done daily, weekly or monthly basis depending on the demand of the business (Simkin, Norman and Rose 2014). Most importantly, ERP system helps in the generation of all necessary financial statements without calculating anything. The accounting staffs use to enter the dates into the information system and it generates the required financial statements. Thus, this process comes in handy when there is a requirement of financial reports from different periods. At the time of year-end closing, accountants face difficulties in preparing all the necessary financial statements like adjusted trial balance, adjusted entries and others. However, in the presence of ERP system, it does most of the work at the time of year-end closing (Simkin, Norman and Rose 2014). However, it needs to be mentioned that the accountants require some basic knowledge and skills in operating computer in order to access ERP system. It becomes easy for the accountants to operate ERP system in the presence of basic computer knowledge and skill. Now a days, most of the companies use to organize effective training programs for their accounting staffs so that they can use the ERP systems effectively (Hall 2012). References Hall, J.A., 2012.Accounting information systems. Cengage Learning. Simkin, M.G., Norman, C.S. and Rose, J.M., 2014.Core concepts of accounting information systems. John Wiley Sons.