Accounting Software are becoming one of the most important aspects for the companies in present time (Massoudi et al., 2017). Organisations are applying accounting software at the workplace with the effect of which they can manage their cash flows in an effective way. There are huge numbers of accounting software available in the market which helps the organisations according to their size and the type of industry they are indulged in. With the help of accounting software cash management system of the organisations have become more easy and now the businesses could manage their cash as well as credit transactions in a proper way as well as with the accuracy. Hence, to gain more in depth information related with accounting software and it’s a usage various literatures will be reviewed by the researcher (Qi, Shen and Dou, 2013). A trail will be made to provide clearer and refined information related with accounting information system and its usage in the organisation with the help of this literature review.
Purpose of the Research
Purpose of reviewing this literature is to evaluate all the aspects of accounting software package and the way with the effect of which it provides a support to the organisation (Nowak, 2016). Commonwealth Bank is one of the organisations using accounting software so as to manage its financial aspects. This will help in developing clearer image related with accounting management system and its usage.
- Objective of this report is to evaluate usage of accounting information system and to evaluate its functions in a proper way.
- To identify and evaluate the benefits of accounting information system
- To identify and evaluate the current gaps or challenges encountered by the users or the customers of accounting software/package (Monden, 2014
To run a business one of the most important aspects is to store the financial information accurately (Massoudi et al., 2017). Accounting information system is one of the aspects which help in managing all the financial transactions of the company. Accounting software packages involve financial reporting of the normal business transactions to the expenditures and financial planning. Sainsbury is indulged in the business in which it is required that the financial records should be maintained accurately so that the firm could gain benefits and could also help its stakeholders to enjoy certain set of benefits. Data related with all cash and non cash transactions is recorded in the financial information (Malmi and Brown, 2008). The system which is required to record all the financial and non financial transactions of the company is known as accounting information system.
Data and Information
In accounting information system includes collecting all the financial records, non financial records, transformation of data into information so that the company could make appropriate set of accounting decisions (Law and Coulmas, 2011). Financial data of the companies are the raw facts which are required to be taken into consideration and to convert that data into information. Gaining information related with the financial data helps the company in making appropriate set of decisions for the future aspects (Halpert, 2011).
Sainsbury is a supermarket chain which is working in different parts of the world. Sainsbury is well known for the quality of its products and services as it provides variety of the products under one roof (Halabi and Larkins, 2016). There are many of the transactions which are required to be managed and to ensure that these transactions could be managed in a proper way Sainsbury uses accounting software packages. Company has set structure which helps it in managing the work appropriately and effectively. This structure helps Sainsbury in managing the flow of information and provides a set direction to the people working at the workplace (Cullinan and Zheng, 2015).
Below image is showing the organizational structure of Sainsbury. Company’s President provides instruction to the vice president who has the charge of all the financial transactions of the company and vice presidents HR who manages the selection and recruitment of the company. Vice president of the company has the responsibility of the accounts and billing and has the responsibility to make appropriate set of decisions related with accounting software packages. This decision of the vice president helps the company in managing all the financial transactions and financial information system of the company (Chan, 2016).
(Chambers and Rand, 2010)
Although the organizational structure of Sainsbury is effective but there are certain set of operational problems which could arise which could have a huge impact on the process of the organisation (Ahmad, Ismail and Mohamed, 2016). In the organizational structure of Sainsbury it could be evaluated that company do not have any IT team. Organisation is going online and for the same it is required that the organisation should have a proper structure. Managing all the operations is one of the most important aspects attached with any organisation and to manage all the operations it is required that the organisation should have a proper set of organizational structure (Worrell, Wasko and Johnston, 2013).
It could be seen that Sainsbury does not have any IT team so it will become difficult for the same to manage the new accounting software. This will have a huge impact on the operations of the organization. Hence, it is required that vice president of HR should hire an IT team with the effect of which work could be managed in a proper way (Venardos, 2010). Hiring IT team will help Sainsbury in managing and maintaining the accounting software with the effect of which work will be processed in a smooth and effective way.
System Acquisition Method
Sainsbury is an organisation which is dealing in a highly competitive market. There are huge number of customers attached with the organisation who prefer to purchase products and services from it (Simkin, Rose and Norman, 2013). There are many of the transactions which are held in the organisation so as to manage these transactions it becomes important that an appropriate system acquisition method should be adopted by the organisation. Adopting appropriate system acquisition method will help Sainsbury in managing all the cash and credit transactions and will help in providing appropriate information system to the company.
Commercial Software: Commercial software is the software which helps in providing license to the organisation to make the sale to the end users (Qi, Shen and Dou, 2013). Commercial software is termed to be the proprietary software which helps in managing the sale of the company.
Custom Software: Custom software is the software which is specially designed so as to manage the functions of some specific organisations. It helps in providing a software package to the organisations so as to manage the mass market (Ogilvie, 2008).
Enterprise Resource Planning: The business process software which helps in allowing the organisations so as to use a system of the integrated applications so as to manage the business and automate many of the back office functions which are related with the technology.
Understanding the functions of all the software it could be evaluated that ERP is system acquisition software which will help in managing all the business functions of Sainsbury. It is required that Sainsbury should apply Enterprise Resource Planning with the effect of which its operations could get managed in a proper and effective way (Nowak, 2016).
System Flowchart for Sales Procedure
System flowchart provides the information related with data flows in the system. It helps in managing the work process system of the organisation. System flowcharts provide a set direction working upon which an organisation could manage its accounting software and avails the data related with flow of information in the systems.
The above flowchart will help in providing data related with the flow of information and will help in developing a better set of understanding with the system software of the company. The accounting software used by Sainsbury manages the information related with the products file in the stock database, then the item accepts the signal, prices are displayed after tracking the information (Massoudi et al., 2017). Then the receipts are itemized, then transaction log file is being prepared and products are selected with the help of product codes. The accounting software of Sainsbury scans the product with the help of bar code reader.
Identify and Control Problems
Accounting software is the software which are hard to manage and it is required that proper analysis of all the aspects should be done in a proper way so as to manage these accounting software (Malmi and Brown, 2008). In the accounting software there are certain set of problems which are being identified by Sainsbury these problems are:
Lack or security is one of the problems which are required to be taken into consideration as the hackers available in the market could hack the files and copy the confidential data of the company.
Weak reporting services are another problem which could be taken into consideration (Law and Coulmas, 2011). Weak reporting affects the information system with the effect of which payment system of the company could get affected.
The accounting software which is being used by Sainsbury is outdated due to which it fails to avail the accuracy. It again affects the financial planning of the company.
Sainsbury could control the problem by using up to date accounting software and could use firewalls with the effect of which risk of hackers will get reduced (Halpert, 2011).
Development and Adoption of Accounting Software
Accounting software is becoming the necessity of businesses in present scenario. It has become important for the businesses to apply the new and up to date accounting software with the effect of which work could be managed in a proper way. Development of the accounting software is done in the form in with the effect of which all the accounting transactions of the company could be tracked and recorded (Halabi and Larkins, 2016). Recording all the accounting transactions of an organisation will help it in making appropriate set of decisions regarding its financial management system with the effect of which it could sustain in the market. Hence, adopting the accounting software will enhance the capacity of the organisation and will provide an effective set of support for the growth of the same.
Current Market Size
Accounting software are grabbing the market and taking over the position of the manual accounting management aspects. According to the survey of IBIS the accounting software industry is rising at the annual rate of 7.1% and has reached to 3.1% billion (Cullinan and Zheng, 2015). Hence, it could be evaluated that current market size of accounting software is really effective which is growing every year and is providing financial management systems with the effect of which companies are growing.
Leaders in the Market
Some of the market leaders in accounting software are:
Freshbook scoring 9.8/10
Xero scoring 9.7/10
Zoho Books scoring 9.6/10
Bright Pearl scoring 9.5/10
These are some of the markets leaders in accounting software. One of the most important aspects which helps these market leaders in attaining competitive advantage is accuracy and security. This accounting software provides 100% accuracy as they remain up to date (Chan, 2016). Another reason is these software are secure as they contain various firewalls which helps them in remain safe and secure and threat free (Chambers and Rand, 2010).
Current Gaps and Challenges
Accounting software which are provided are really very costly as they require huge amount which is required to be invested by the businesses in accounting software (Chan, 2016).
People working in the organisation do not have proper knowledge of the accounting software due to which they fail to operate the same.
Threat of hackers remain attached with the accounting software
It requires that the company should ensure to have an IT team so that the same could get managed. This brings an addition to the cost and expenses of the company (Ahmad, Ismail and Mohamed, 2016).
Accounting software helps in providing a proper set of support to the companies in present scenario. It is required that the companies should focus upon making a onetime investment in accounting software. This will help them in managing the accounting information system.
Applying effective firewalls will help in reducing the threat of hackers and will keep the systems up to date and secure from all the vulnerabilities.
Providing training to the employees will help in providing a better set of solution to the company as they will be able to manage the software.
It will help in reducing the workload and will help in managing and tracking the information in an appropriate way
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