An accounting system is a type of computerized information system that helps a business in maintaining and managing its accounts and financial transactions. A business has a very complex accounting system that consists of sales, purchase, transactions and other kind of financial processes. The business also involves a number of entities such as creditors, shareholders, managers and investors. An accounting system helps in managing and recording the financial transactions and also helps the decision makers to use the recorded and managed transactions to make vital decisions for the growth of the business.
The major highlight of an accounting system is that it has an organized set of manuals, methods and procedures that are established to get control for accounting complexities and to record, analyze, classify, distinguish, summarize and present financial in front of management for the process of decision making.
With the help of an accounting system a business can keep the record of its income and expenses with great ease. With the help of accounting system business managers can decide that whether a business operation is profitable for the business, or it will bring new taxes or impose new customs on the business. Accounting system has come a very far since their birth as the history of accounting is dated back almost 7000 years. However today’s accounting systems are using advance computerized technologies such as Internet and cloud computing through which a business can access their accounting from each and every corner of the world. In addition to this most of the businesses are now using distributed accounting system as well.
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