AIS or Accounting Information systems
collect the data of the transactions and process them and this data is then
communicated to the parties involved. Different types of such systems exist and
they are varied. The factors that make them different include but is not
limited to data volume, business type, size of the business and the type of
data management needs.
Types
of Systems
There exist three major categories of
Accounting Information Systems. What a firm uses will depend on the business
type and business size, the needs and sophistication of business.
Manual
Systems
Small businesses and home based businesses
depend on manual accounting information systems. Source documents, general journal, general ledger and special journals etc will be required if the system
is completely manual.
Legacy
Systems
They are often used in existing business
companies. They may have started using AIS long before the technology became as advanced as it is today. They may be
old fashioned but they have their own advantages. They have historical data
that are valuable to the firm. The employees of the firm will be familiar with
it and they will understand the system better. It will be customized according
to the needs of the firm. It also has some disadvantages. They may not have any
documentation. The hardware and software parts may be difficult to find if one
need to replace it.
Replacement
of Legacy Systems
Here the legacy systems will be
completely replaced with new and up to date systems. This replacement may be
expensive. One process of updating legacy system is screen scraping which will
take the computer screen data and will translate it in such a way that a newer
application will be able to read it easily. One can also set up an enterprise
application integration systems. You may want the latest and up to date system
to keep your financial information. It will give you a competitive advantage in
the industry.
As per your requirements and business
needs, choose the system that suits you. Accounting Information systems are
diverse and it suits a variety of uses. The ones a firm needs is determined by
the business it is used for.
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