ACCOUNTING IN COMPUTERISED ENVIRONMENT | JAIIB AFB STUDY MATERIAL

ACCOUNTING IN COMPUTERISED ENVIRONMENT | JAIIB AFB STUDY MATERIAL

Today, most of the organisations are performing their accounting tasks on computers instead of following the traditional method of bookkeeping in hard books. So, it is safe to say that mode on account is more of computer-keeping than bookkeeping.

Following functions are performed through an accounting system:

1. The system records all the business transactions in the form of accounting entries 
2. With the help of these accounting entries, financial statements are prepared. 
3. Accounting standards are used as a basis to prepare the financial statements. 
4. There are many different other financial reports which are prepared with the use of data available in the financial statements.

Like any other computer system, computer accounting system also runs on a set of instructions which are known as software programs. These programs are developed by a computer software professional who is known as a programmer. Instructions are in the computer language which are input into the computer program. 

Although there are other computer languages which can be used to write an accounting software such as Foxpro and COBOL as well as an Operating System such as UNIX or Windows. Digital computers are the computers which are used in computerized accounting.

Following are some of the main features of computerised accounting:

1. Speed of recording
2. Accuracy
3. Various Informative Reports can be generated
4. Economy in costs
5. Computerised Accounting System could be a Single Stand Alone Unit or a Multiple User, i.e. LAN, WAN, etc.

AFB RELATED LINKS:-

DIFFERENCES BETWEEN MANUAL AND COMPUTERISED SYSTEMS

Following at the differences between traditional or manual & computerized systems of accounting:

• The data which is stored in the computer is not visible and therefore, it is difficult to establish the trail of events. 

• Manipulation of accounting data can be done to generate different reports or statements.

ADVANTAGES OF COMPUTERIZED ACCOUNTING SYSTEM

The benefits of installing a computer system are given below:

1. A computerised system is accurate, provides high speed of recording & have lower cost of operation. 
2. Different reports can be generated using the same accounting data. 
3. There is a reduction in the errors when accounting is done on computers 
4. Records are completed automatically by feeding one entry into the computer 
5. There are different set of print out format are available.

DISADVANTAGES OF COMPUTERIZED ACCOUNTING SYSTEM

There are some disadvantages of using a computer system also which are given below:

1. It requires a special program and professional knowledge to operate the system 
2. Operations are required to be conducted by the qualified staff 
3. The cost of computer peripheral and stationary is quite high 
4. The system requires regular backup of data so that if it ever get lost it can be recovered. 
5. Computers are vulnerable to viruses

AFB RELATED LINKS:-

Influence of Computerisation in the functions performed by a bank: Computers have influenced many functions which are performed by the bank. Such as:

1. Operations of banks
2. Accounting of Banking transactions 
3. Acceptance of deposits 
4. Lending of money 
5. Remittances 
6. Clearance of cheques 
7. Standing instructions 
8. Centralised banking 
9. Automation of Banking services

CORE BANK COMPONENTS INCLUDE :

• Core Bank Financial Institution Infrastructure
• Core Bank Product Build
• Core Bank Customer Management and Customer Overview
• Core Bank Account Administration
• Core Bank Payments
• Core Bank Management Information

Read Also:-

INFORMATION SYSTEMS SECURITY

Information Systems Security provides essential information for managing the security of an 

organisation where information technology is an important factor. It is mainly for all the staff, who are 

the first-line support, responsible for the daily, efficient operation of security policies, procedures, 

standards, and practices. It covers:

– Access control systems and methodologies

– Computer operations security

– e-mail and internet access

– Application and systems development

– Business continuity and disaster recovery planning

– Telecommunications and network security

– Physical security

– Cryptography

– Security management practices

– Law, investigations, and ethics

Internet:

Internet is the inter-connection between several computers of different types belonging to various 

networks all over the globe.

World Wide Web (WWW):

WWW is a series of servers that are interconnected through hypertext. Hypertext is a method of 

presenting information in which certain text is highlighted that, when selected, displays more

information on the particular topic. These highlighted items are called hyperlinks and allow the users to 

navigate from one document to another that may be located on different servers.