Question

In: Accounting

NO COPY AND PASTE!! I AM CAPABLE OF LOOKING ON GOOGLE. I NEED FURTHER EXPLANATION THAN...


NO COPY AND PASTE!! I AM CAPABLE OF LOOKING ON GOOGLE. I NEED FURTHER EXPLANATION THAN WHAT IS PROVIDED ONLINE.

Could you please research and explain the three specific reasons why companies change their existing Accounting information systems(AIS)? Also, if the company is using QuickBooks or Peachtree, what do you think it would be the best choice to upgrade the company's accounting information systems? Be specific in providing your explanation.

Solutions

Expert Solution

Following are the three reasons according to me why company changes their existing AIS:-

1) Better Intergration

Generally, one major reason why a company changes its existing AIS is better integration in the new system. For a big organisation, it is very important to keep all the data integrated with each other. This will help the company to keep their data upto date, can access whenever required, can submit data to regulators whenever required and so many other benefits.

2) A larger database

An AIS must have a database structure in place.

Generally, the type of data included in an AIS may consist of the following:

  • sales orders
  • customer billing statements
  • sales analysis reports
  • purchase requisitions
  • vendor invoices
  • check registers
  • general ledger
  • inventory data
  • payroll information
  • timekeeping
  • tax information

It is possible that the old AIS is not having a higher database to handle all such functions together and so company changes its existing AIS.

3) Security concerns

Generally, the internal controls of an AIS are the security measures it contains to protect sensitive data. These can be passwords, biometric entries, id card entries etc. Also, it must have proper system in place to safeguard their highly confidential data. It is possible that in their old AIS, there are certain security concerns and due to which their data is getting leaked which leads to high losses. So, they may go for change in existing AIS.


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