There are many types of steps taken by companies for making accounting process easy and accounting information system or AIS is one of them. AIS is basically a computerized system that is used for recording different types of financial and accounting transactions taking place in the company. Accounting information system also performs payroll and other similar functions. In calculation of taxes, this system proves very useful.
If size of company is medium or large, it is really impossible to carry out all the accounting work manually. Major types of information entered in this system are sales, purchases and expenses. All types of financial statements are automatically generated by the system afterwards. Using accounting information system offers many benefits to a company. These benefits are useful in running company successfully.
Accuracy And Timeliness
Financial reports and statements prepared by the accounting information system are accurate. Unlike manual reports, they do not contain any error. Thus, owners or shareholders of the company can know about the actual performance of company over a period of time. Since calculations are made by this system in a fast manner, in a very short period of time, all types of financial statements can be made.
If any type of past information is to be retrieved, it can be done in no time. For example, all past invoices can be obtained with a single click. Due to accuracy and timeliness, taxes are paid correctly in time.
Integrated Posting And Document Production
One of biggest advantage of accounting information system is that by making single entry into the system, various types of reports are generated. Unlike manual accounting, same entry is not required to be made again for making reports. Since AIS are fully integrated systems, any transaction recorded is automatically posted at different locations. Even all other correlating entries are also posted. It is due to integrated nature of AIS that all types of financial reports are obtained immediately.
AIS has helped companies a lot in saving time and money. Only one accounting clerk can take care of all types of reports and statements. This system work as a full time accountant and different types of documents can be produced at any point of time. All pay bills are generated automatically by this system and they are generally error free. Invoices, purchase orders and credit and debit notes can be easily made and recorded in the system.
Periodical Activities And Backup
Accounting information system also helps in carrying out periodical activities. For example, at the end of month or quarter, all the needed reports can be generated. Closing and adjusting entries are made easily in the system. All types of financial statements and reports are saved automatically in the system. Since loss of information can occur in future due to any reason, backup of all types of financial statements and transactions can be taken.
This backup can be restored at any point of time. Most of accounting information systems have great storage capabilities. Various types of backups that can be taken from this system are daily backup, weekly backup and monthly backup. After the completion of one accounting period, which normally is a year, balance sheet items are transferred automatically to next year.
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