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Manual vs. Computerized Accounting System what is better system in making

financial reports?

It’s still more favorable to use Computerized Accounting System in making financial reports.
Because using this system its more convenient and less time consuming while the accuracy is much
more acceptable and its easy access on your own computer and much more likely it’s just needed to be
updated time to time and accessible for the major management and board and the flow of information
can be use any time it’s needed to be used for the purpose of other creditor and investor that will be
using the Financial reports. And it’s easier to identify the cash flow of the company. While the latter
system is much more complicated.

The manual accounting system is the base form of the financial reporting but in doing so there
was so many things needed to do and process to make and because this things some minor problems
was occurred but as the time goes by there was new system has been made like computerized
accounting system that make the process of making the reports easier and more conceptualize and it’s
easy to use and when finding the information needed it can be access thoroughly and it has many
benefits given in the company and as for the accountant. But even there was so many benefits in using
the C, A, S there was still problems that has been seen like there was viruses in the computer and there
was information theft in the company in accessing the information and there was corrupting files that
has affecting the information and after that the information is needed to be re-entered in the computer.

Typically, In a Manual Accounting cycle the following steps are taken: Analysis of transactions,
journalizing entries, posting to the ledger, preparing an unadjusted trial lance, preparing a worksheet,
preparing balancing statements, adjusting the ledger accounts and posting adjusting journal entries,
closing the temporary accounts (posting and journalizing the closing entries), preparing a post-closing
trail balance, preparing and posting optional reversing entries, and interpreting the accounting
information (Yacht, 2008, p. 42).

The financial statements derived from manual accounting are the summation of many Individual
transactions performed by hand and kept, usually in paper form, in journals and ledgers. Many small
businesses use manual accounting and manual accounting has its advantages. From my experience
managing a small business, performing the accounting cycle manually gives the manager or owner of the
business a hands-on idea of how, and on what, money Is being collected and spent and gives a good
overview of the performance of the company on a day to day basis.

Manual accounting is tried-and-true and has been around for centuries. It Is cost effective for a small
volume of transactions as would exist in a small business and is fairly transparent, as the Journal entries
and general ledger are in paper form and readily available. However, there are disadvantages too
manual accounting system. It can be slow and laborious, and requires meticulous, timely record keeping.

As for the Computerized Accounting System there was so many innovations and application has been
made to help on the system and making it better and more useable to every companies in the world
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based on the International Accounting Standard Board (IASB) that has been the mediator of the
accounting system in the world

It is fair to say that a computerized accounting system is much quicker than a manual accounting system
as all the user has to do is enter the data into the computer and the computer will make the calculations
and produce and print out any reports, invoices or credit notes at the touch of a button.

-Increased Speed and Accuracy

The main benefit of the computerized accounting system is to carry out the processing stage quicker,
more consistently and accurately than the manual accounting system. These are a few of the main
benefits of a computerized system as it is able to produce reports immediately i.e. customer
statements or more enhanced reports such as a cash flow analysis or VAT returns. Another benefit of
the computerized system is its error detection capabilities i.e. if wrong values are entered the computer
will detect this.

-Less Staff Required

Although some feel this may be a disadvantage I feel that this will help a small business financially as
they therefore have less wages to pay and need less room to accommodate for the staff. It is fair to say
that a computerized accounting system can do the job of several accountants in the same time and cost
much less money

-Less Space Required

Again this is a another benefit of a computerized accounting system as the less space that an
accounting firm needs the cheaper it is go because the information’s is in the hard drive of the computer
while the manual accounting the files is needed to be segregated and compose in neat order.