The Impact of Modern Day Accounting Systems

Topics: Comparison of accounting software, Accountancy, Bookkeeping Pages: 3 (670 words) Published: September 11, 2011
The Impact of Modern Day Accounting Systems
Mark A. Croskey
ACC 205 Principles of Accounting I
Instructor: Thomas Amsberry
September 12, 2011

Accounting and bookkeeping haven't always been particularly easy to accomplish. In the past, before there was mechanized bookkeeping, keeping track of financial transactions, and their ultimate effect on a business, was a matter of sorting transactions into the proper category and recording them by hand into paper ledgers, using specialized paper to physically emulate the T-Account concept. One of the many challenges facing small and medium business owners is the ability to maintain accurate financial records. This is due to their primary focus being on the operations of the business, leaving little time to ensure that all their transactions have been properly and accurately recorded. In the past, a large company needed a big roomful of accounting clerks to prepare the accounting records manually - and that's a LOT of wages. Using modern computerized software, the same job can be performed by a much smaller group of people, saving a small fortune in wages expense.

Another plus is that modern accounting systems make it easier to operate under a 'perpetual' inventory system - the inventory numbers on the books more closely match the inventory that is actually on hand (theoretically). That's what all those bar codes and item scanners are all about. Modern accounting systems fulfill the basic accounting needs while offering increased accuracy in tracking trends, enabling collaboration and giving quick access to data. Computerized solutions offer the traditional transaction processing, classification of data and reporting while simultaneously increasing the range of inputs to give a clearer and more comprehensive picture of the financial health of a company. These features of modern accounting systems let management make better use of resources to increase profits while identifying cost savings and spending less....
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