Question

What is an AIS and how does it support organizational strategy?

Answer 1

Accounting Information System (AIS) is defined as a system of collection,processing and storing of financial and accounting data which is being used by decision makers. AIS is a computer-based method for tracing accounting activity combining with information technology resources. The statistical reports generated by it are useful  internally by management or external parties (investors, creditors and tax authorities). The key elements that compose this system are People, Procedures and Instructions, Data, Software, Information Technology Infrastructure and Internal controls.

  Accounting Information System considersdifferent aspects, which help an organization in achieving its goal and organizational strategy . Accounting Information Systems offer value and is a crucial  part of the value chain which makes it faster, more reliable, providing better service or advice, providing something in limited supply, providing enhanced features or customizing it. Value is provided by performing a series of activities referred to as the value chain which includes primary activities and support activities.

The impact of AIS is on the areas like - Budgeting and Planning, Expenses Management, Revenue Management, Cash and Treasury Management, Accounting software, Electronic Banking, Activity-based Management, payroll, sales, purchases, invoicing, taxation, inventory management and control etc. AIS helps the company to analyze  certain perspectives and in enhancing the performance of a company by allowing it to conduct systematic operations across the market. With the adoption and implementation of information system, an organization can focus harder on increasing its own efficiency. So by focusing on its operations , value chain and various activities of the company and it also makes sure that all of them are being done in a harmony in achieving the goal of the company so it directly suppourts the organisations strategy.