Learn In Detail What An Accounting Information System Is Need for the accounting system Keeping track of accounting information is the primary requirement of every business organization. Collecting accounting information is a daunting task. SO, this task is performed in the organizations with a special and expert individual. These experts fulfill the required eligibility criteria for performing any accounting task. Accounting refers to the process of classifying, recording and summarizing the information financial in nature.
In order to face unnecessary costs, an individual must have to properly maintain detailed records or accounts. Maintenance of accounting records is an essence not optional. A company, which fails to keep appropriate accounting records of the business transactions, may lead to inefficient working of an enterprise as well as loss in the revenue of the company.
Meaning of accounting information system The process of collecting, storing, processing the financial as well as accounting data by the decision makers is popularly known as the accounting information system. A well devised accounting information system benefits every type of the company. This system ensures reliable and relevant information, which is reported in the accounting statements. This system must be at a place providing the individuals with the true picture of their performance.
Purpose of accounting information systems: This system is used to prepare informational reports that may help other parties or the managers of the company to make decisions. Modern world is technology world, so most of the accounting systems available today are based on the computer. This process is to make sure that all the accounting records are accurately recorded and processed. This system is generally used by the individuals including managers, accountants and the business analysts. The reliability of this system plays a prominent role in the effective functioning of an enterprise. Five basic principle contributing to its reliability include privacy, security, confidentiality, availability and processing integrity.
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