Computer Accounting

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However, this convenience has positive and negative sides. One of the important advantages of computer accounting is that It is efficient. In less than half the time needed for traditional, non-computer accounting, you can complete the required functions through computerized programs. Some additional advantages using computerized accounting system include: 1. Reduction in processing cost. The large reductions in the cost of hardware, software, and the availability of user-friendly packages. The manual system has lost its comparative cost advantage. . Speed of processing. The computer can process thousands of transactions at incredible speeds, and high peed printers enable output to be produced at thousands lines per minute. 3. Error reduction. Once programmed, the computer is virtually error free in both processing and performing mathematical calculations. Manual system are much more prone to human error. 4. Automatic posting. Once data has been entered all posting is performed automatically by the computer. 5. Automatic production of documents and reports.

The computer can be programmed to produce automatically up to date reports on request and accounting documents such as Invoices and statement of accounts. 6. Improved reporting. The computerized system can be used to generate a wide range of reports such as analyses of sales by product, salespeople and customers. 7. Faster response time. This provides the users with the ability to seek and receive very quickly, answers to a wide range of queries. Where there are advantages, there are also some disadvantages to computerized accounting.

It may be challenging for those living in countries where a power supply is not steady. Another issue is the threat of viruses, which can destroy your data and files with no warning. Backing up data on a remote data storage system may help you upgrade your valuable accounting Information. Other disadvantages may Include: 1 . Computer fraud. The use of computers by programmers to assist in defrauding business entities of huge amounts of money. 2. Power failures. The other forms of system breakdowns or crashes.

Such system therefore require an elaborate program of constantly backing up computer records. 3. Computer virus. Programs Introduced to a computer system can go undetected and gradually destroy all the files maintained in the system. 4. Computer hackers. Unauthorized people can gain access to a computer file and make amendments to those files. Computerized accounting packages can save you money, time, and even help boost your profits. Yet, many solicitors have yet to switch from the old manual system.

Traditional three-in-one accounting systems are still widely used in solicitors’ firms 1 OFF this task, and almost all practices could benefit from using them. Computerized accounting packages are increasingly sophisticated and have a number of advantages over manual systems: they’re faster, more flexible and accurate; they offer greatly-improved access to data; and, significantly, they can provide valuable management information which contributes to greater productivity and, ultimately, profitability. From a business point of view, there are three main advantages to a good accounting package.

First, they improve efficiency and allow staff to respond to clients quickly. Second, solicitors should be able to spend more time on fee-earning activities rather than analytical or administrative tasks. Finally, a good system will provide greater security of important data. Despite these benefits, most small to medium-sized firms, and even some larger practices, are soldiering on with their rusted manual systems. The reluctance to switch to computer-based systems is attributed to the profession’s lack of enthusiasm for technology.

Many small to medium-sized practices are slow to commit their accounts to computer because they are traditional firms that have never been pulled into the computer era. Most businesses use off-the-shelf accounting packages, but solicitors should use specialized legal products to meet the requirement to run client and office ledgers. They’re actually cheap at the price, considering the size of the Irish legal market and he fact that developers must enhance and adapt their products to continue to meet legal requirements.

The initial cost can be quickly recouped through substantial savings realized from a computerized system. Traditional manual accounting systems are cumbersome, inflexible and are so demanding of staff time and skills that accuracy, timeliness and completeness are sacrificed so that such systems tend to be mainly used to demonstrate past regulatory compliance in the areas of taxation and accounting rules. On the other hand, properly-designed computerized accounting yester improve the quality and timeliness of accounting information and provide many non-accounting management tools.

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