Scribd
Upload
7 views4 pages

CH 1

The document provides an overview of Computerised Accounting Systems (CAS), highlighting its features, components, and advantages over traditional accounting methods. It discusses the importance of data processing, security features, and various subsystems within an Accounting Information System (AIS). Additionally, it covers methods of account codification and the limitations of CAS, emphasizing the need for timely and accurate financial reporting.

Uploaded by

subhodipd006
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
7 views4 pages

CH 1

The document provides an overview of Computerised Accounting Systems (CAS), highlighting its features, components, and advantages over traditional accounting methods. It discusses the importance of data processing, security features, and various subsystems within an Accounting Information System (AIS). Additionally, it covers methods of account codification and the limitations of CAS, emphasizing the need for timely and accurate financial reporting.

Uploaded by

subhodipd006
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 4

CHAPTER 1 OVERVIEW OF COMPUTERISED

ACCOUNTING SYSTEM
COMPUTERISED ACCOUNTING SYSTEM
A system that process accounting raw data to transform into reports,statements and schedules
as required by the users
Features of Computerised Accounting System (CAS)
1. Cost advantage:
CAS more efficient than paper based accounting,as work will be done faster and time will be saved
1. Simple and Integrated :
Computerized accounting is easy and integrated with the various functions of business such as sales,
finance, purchase, administration etc.
2. Accuracy & Speed :
Computerized accounting has User-definable templates which provides fast, accurate data entry of
the transactions.The reports are readily available with the data entry
4. Security:
Data safe from natural and man made disasters
5. Reliability :
Computerised accounting makes sure that the critical financial information is accurate, controlled and
safe from data corruption.
6. Scalability :
CAS can be implemented in all types of business organisation
COMPONENTS OF COMPUTERISED ACCOUNTING SYSTEM (CAS)
PROCEDURE

SOFTWARE
HRDWARE
PEOPLE
DATA

Five pillars of Computerised Accounting System


• PROCEDURE: Logical sequence of accounting Task (Business transaction Source document
Journal Entry Ledger Trial Balance AdjustmentsFinal Accounts)
• DATA: Are raw facts taken from the source document to input (E.g:- date,Ledger heads to debit and
credit, Amount).
• PEOPLE:Users of computer system (Accountant, Data entry operatoretc.)
• HRDWARE:Computer and its peripherals (CPU, Display Unit, Printer, Network etc)
• SOFTWARE:System software (Windows, Linux etc) and Application Software (Tally, Peachtree, MS Excel
,GNU Khata etc)
ACCOUNTING CYLCE
It is a collective process of recording and processing the accounting events of a company

1
www.educom.in 2019-20
In Computerised Accounting System ,these processes ca be accomplished through the use of computers
DATA AND INFORMATION
Data refers to facts or figures,that are stored in or used by a computer. Data when processed be-
comes information

GROUPING OF ACCOUNTS
Grouping of Accounts is the process of classifying the ledger accounts and organizing them under
major heads of accounts.Accounting information can be easily interpreted when the reports are presented
having grouped them in a scientific way.
CODIFICATION OF ACCOUNTS
Codification means giving an identity to every account by alloting a number or alphabets in hierarchinal
order
Methods of Codification
1. SEQUENTIAL CODES
In this method, numbers or letters or combination of both are assigned in consecutive order.This
method is applied commonly to identify source documents such as Bills, Cheques,Invoices etc. The sequential
order helps in quick searching of documents.
Eg:- SC001 National Agencies
SC002 Kairali Traders
2. BLOCK CODES
In this method of coding, a range of numbers is divided into a desired sub-ranges and each sub range
is allotted to specific group. Under each sub range,sequential codes are allotted to each item of corresponding
group.
Eg:- 100 – 199 Stationary
100 -109 Soaps
100 Lux
101 Hamam
102 Pearce
110-119 Tooth paste
110 Pepsodent
111 Colgate
200 – 299 Footwear
200-219 Ladies Chappal
200 VKC Pride
201 Jogger
220-239 Kids
220 Bata
221 odyssia
3. MNEMONIC CODES
Alphabets or abbreviations are used as symbols to codify the item or information.
Eg;- PJ – Purchase Journal,
BB – Bank Book
CB – Cash Book etc..

2
2019-20 www.educom.in
METHODOLOGY TO DEVELOP CODING STRUCTURE
When we decide to develop a coding system ,we have to identify the components to be codified and
its hierarchical relationship
Let us examine how to develop a coding structure for PIN code of the Postal department.

Security Features of CAS Software


Password Security:
It is secret key word used by an authorised person to get access to computer,file or program.
Data Audit:
This feature of CAS helps to fix the responsibility upon a person who have used the computer in a
defined period and track changes have been made during this time
Data Vault:
It helps to maintain confidentiality of information by encrypting the data.
Advantages of CAS
1. Timely generation of reports and information in desired format.
2. Alterations and addition in transactions are easy and gives changed results instantly
3. Ensures effective control over the system
4. Less costly in the processing of accounting data
5. Confidentiality of data is maintained.
Limitations of CAS
1. Faster obsolescence of technology necessitates investments in shorter period of time.
2. Data may be lost or corrupted due to power interruptions.
3. Data may be hijacked.
4. Un programmed or unspecified reports cannot be generated.
Accounting Information System (AIS)
AIS,being a part of Management Information System (MIS),is responsible for providing timely and
accurate financial and statistical reports for internal and external users. The sub system of AIS are briefly
described below.

1. Cash and Bank Sub system :


It deals with the receipts and payments of cash. Both physical cash and electronic fund cash.
3
www.educom.in 2019-20
2. Sales and Accounts Receivable sub system
it deals with recording of sales, maintaining of sales ledger and receivables.
3. Inventory sub system :
it deals with recording of different items purchased and issued specifying the price, quantity and date.
4. Purchased and Accounts payable sub system :
it deals with the purchase and payments to creditors.
5. Pay Roll Accounting sub system :
It deals with payment of wages and salaries to employees.
6. Fixed Asset Accounting Sub system :
It deals with recording of purchases, additions, deletions and usages of fixed assets.
7. Expense Accounting Sub system :
It records expenses under broad groups such as manufacturing, administrative, financial, selling and
distributions and others.
8. Tax Accounting Sub System :
It deals with compliance of VAT, Excise, Customs and Income Tax Rules. are vital for management
decision making.
9. Final Account sub system :
It deals with the preparation of final Accounts.
10. Costing sub system :
It deals with the ascertainment of cost of goods produced.
11. Budget Sub system :
It deals with the preparation of budgets
12. Management information System (MIS) :
It deals with generation and processing of reports that are vital for management decision making.

1.The code “101-999” for “ladies footwear” is an example of......code


Block code
2.CAS stands for
Computerised Accounting System
3.Codes AB0001,AB0002,AB0003........etc are example of .....................code
Sequential code
4.Data Audit aims to.................
trace or track changes in accounts
5.The concept of Data Vault is related to ..........................
Dta Encryption
6.Draw a diagram showing the major subsystems of AIS

7.What are the five pillars of CAS


 Data
People
Procedure
Hardware & Software
8.Codification enables...................
 Making hierarchical relationship between accounts

4 PREPARED BY: SIRAJUDHEEN M (HSST,COMMERCE)


2019-20 www.educom.in

You might also like