Some basic computer concepts

Introduction to computerized accounting system

Computerized accounting refers to the processing of accounting information through the use of computers. This helps to provide users with accurate accounting records and reports to enhance efficiency in decision making. It involves the use of dedicated accounting software and spreadsheet programs to record, classify and summarize accounting information in a well-acceptable manner.

Computerized accounting allows information to be shared almost instantly through the internet or local networks. It takes accounting transactions as inputs that are processed through accounting software to generate reports such as day books, ledgers, trial balance, statement of profit or loss and statement of financial position. Computerized accounting systems are software programs that are used to process accounting information in the computer. The accounting systems are usually processed as per generally accepted accounting principles (GAAP) to produce reports as per user requirements. Computerized accounting systems can be stored on a company's computer at the workplace or remotely accessed via the internet. Others are online or web-based computerized accounting systems which need not be installed in the computer.

Computerized accounting systems allow users to set up income and expense accounts, such as rental or sales income, salaries, advertising expenses, and material costs. Also, they can be used to manage bank accounts, pay bills, and prepare budgets. Depending on the program, some accounting systems enable users to prepare tax documents, handle payroll, and manage project costing. Most of the computerized accounting systems can be customized to meet the requirements of the respective organisation. In this regard, they can assist organisation in creating users of different accounts create accounts in the form of elements of financial statements such as income, expenses, liabilities, equity and assets. Further to this, they can be used to manage bank accounts, pay bills, prepare budgets and process payroll.