The world these days seems to be moving into a newer, brighter, digital version of its older self. While people used to purchase with paper money, they can now buy their goods with plastic. E-mail is becoming a more reliable source of communication and e-commerce is an up and coming way for business men and women to make money. Even the world of accounting has become computerized. There are many programs out there designed to take the world of scratching out finances with pen and paper into the new world of the computer. What are the advantages of this system, and will they work for your organization?

The Advantages of a Computerized Accounting System

There are several advantages when using a computerized system. “Accounting Basics,” a chapter written in the book Accounting for Windows suggests that one such advantage is the arithmetic. Adding and subtracting both debits and credits is automatically achieved by the computer with accuracy. The book adds that invoices, credits and anything else that would lend itself to an audit trail is maintained by the program on your computer automatically.

Also, data within a computerized system can be kept confidential and secure with the use of passwords. You can pull up your most recent transactions quickly and check the status of an employee or client. You can also create financial statements with merely a click of a mouse. Data entry takes less time than hand written notes.

Modules

Most software programs provide variations of several different modules that make up a computerized accounting system. Typical software accounting modules include a general ledger, inventory, order entry, and bank manager. There are also accounts receivable, accounts payable, and payroll.

Conclusion

While computerized data systems have many advantages, the systems must be used in the proper manner. Data needs to be backed up frequently. The cold hard fact is that computers and systems do crash, and hard copies help prevent the loss of important information. Having backups is imperative to keeping your company safe. With those considerations taken to heart, computerized accounting systems can help your business be the most productive it can.