Computer-Based Accounting Systems
We can view technological innovation in Accounting Information System as a continuum with automation at one end and re engineering at the other. Automation involves using technology to improve the efficiency and effectiveness of a task. Too often, however, the automated system simply replicates the traditional (manual) process that it replaces. Reengineering, on the other hand, involves radically rethinking the business process and the work flow. The objective of reengineering is to improve operational performance and reduce costs by identifying and eliminating non–value-added tasks. This involves replacing traditional procedures with procedures that are innovative and often very different from those that previously existed.
In this section we review automation and re engineering techniques applied to both sales order processing and cash receipts systems. We also review the key features of point-of-sale (POS) systems. Next, we examine electronic data interchange (EDI) and the Internet as alternative techniques for re engineering the revenue cycle. Finally, we look at some issues related to PC-based accounting systems.