International Journal of Accounting Research

Comprehensive Study on Data Management in Accounting Systems

Daniel Tao^* Department of Finance, University of Twente, Enschede, The Netherlands
^*Correspondence: Daniel Tao, Department of Finance, University of Twente, Enschede, The Netherlands, Email:

Received: 02-Oct-2023, Manuscript No. IJAR-23-23691; Editor assigned: 04-Oct-2023, Pre QC No. IJAR-23-23691 (PQ); Reviewed: 20-Oct-2023, QC No. IJAR-23-23691; Revised: 27-Oct-2023, Manuscript No. IJAR-23-23691 (R); Published: 04-Nov-2023, DOI: 10.35248/2472-114X. 23.11.354

Description

Financial and accounting data are gathered, stored, and processed by an accounting information system. Reports produced by the system are utilized in decision-making processes related to the management of organizations. External parties assess loan and investment opportunities with the company using these reports as well. The following are the system's main components: The guidelines and practices that control the gathering of data. The internal controls set up to ensure correct data recording. The training used to make sure users are using the system properly. Information processing and storage are handled by the software and integrated database. The software and database are stored on this hardware. A manual bookkeeping system can be less effective to operate than an accounting information system, which is often run using computerized data processing technology.

A computer-based system has significant benefits since it lowers transactional error rates by automating numerous accounting procedures. In addition, it can generate reports far faster than a manual approach. Typically, an accounting information system consists of multiple modules, each specifically built to handle different kinds of transactions. Payroll, general ledger, inventory, accounts payable, accounts receivable, and reporting are some of these modules. Ancillary operations like purchasing; production scheduling, warehousing, and human resources could be added to the core set of modules. Several components that are significant to the accounting cycle are included in an accounting information system. Typical Accounting Information System (AIS) contains data on income, expenses, customers, employees, and tax information, while the exact information varies according on the industry and size of the firm. Specific data includes information from purchase requisitions, invoices, check registers, inventories, payroll, ledgers, trial balances, and financial statements. Sales orders and analysis reports are also included.

The storage of data in an accounting information system requires a database structure. Query language is usually used to program this database structure, enabling table and data manipulation. AIS features a large number of fields for both entering new data and editing already stored data. Furthermore, accounting information systems are frequently extremely secure platforms that have safeguards in place against viruses, hackers, and other outside parties trying to obtain data. The importance of cyber security is growing as more businesses keep their data electronically.

Three types of accounting information systems exist: Manual, Legacy, and Modern/Integrated systems. Smaller organizations tend to employ manual systems, in which there is no technological integration and the system is entirely manual. Due to the size of the company, an AIS does not need to be overly complicated, and all records may be kept up to date manually. In contrast, a manual system would need source documents, a general journal, a general ledger, and any special or subsidiary journals for more precise bookkeeping. Prior to the development of advanced technology, legacy systems were widely used. While its ease of use and knowledge of their company's past data are advantages, it clearly lacks the flexibility and dependability that contemporary technology can provide. Legacy accounting systems are thought to be considerably less user-friendly than modern, integrated systems, which are Windows-based technology. They can be quickly implemented, have fewer defects, and typically cost less than legacy systems.