Question

Jobel Company Limited, an insurance brokerage firm, has been posting huge financial losses since the outbreak of the COVID-19 pandemic. The company is in the process of filing for bankruptcy due to the consistent fall of its share price, a situation solely attributable to the COVID-19 pandemic. At the last

shareholders’ meeting before the pandemic, members voted massively for the introduction of a computerised accounting information system (CAIS) to automate the operations of the company. However, the key management members are clueless as to the key motivating considerations for the migration. As a computerised accounting information systems student, you have been approached by the Chief Executive Officer of the company for advice and direction.

Required:

Write a letter to the Chief Executive Officer discussing the the key motivating considerations for the migration and the extent to which the migration could impact the future operations of the company.

Answer 1

Dear Chief Executive,

Our company is in the process of filing for bankruptcy due to the consistent fall of its share price, a situation solely attributable to the COVID-19 pandemic. At the last shareholders’ meeting before the pandemic, members voted massively for the introduction of a computerized accounting information system (CAIS) to automate the operations of the company.

The introduction of the computerized accounting information system led to effective accounting operations for the organizations. The shift from manual to computerized accounting information systems will make an impact on the organization. The manual accounting system requires large storage to keep accounting records, and vouchers. The requirement of books and stationery and books of accounts along with vouchers and documents is dependent on the volume of transactions.

Time is most important to the organization. The staff will be able to perform tasks faster using a computer. They can get the information quickly and this aspect of time is the most important advantage. On the other hand, the company needs to spend a large amount of time plan and set up the infrastructure, especially a large company that may need to implement change periodically. The company also needs to spend time training the staff and considers the time lost when there is any system failure. Introduction of the computerized accounting information system, the company will be benefited with increased reliability, increased productivity, increased accuracy, cost-effectiveness, automation of processes, up to date info, Storage and Retrieval, better security, scalability, less labor need and availability of management information reports these all of which leads to more business.

The accounting information systems contain confidential data that should be kept safe all the time. The company must set up properly preventive measures to prevent or minimize the problems when it occurs. Important data such as financial data should be backed up daily, weekly, or monthly according to how critical is the data. We can recover the data whenever a problem happened in the system. computers are fast in responding to client’s queries and the analysis of data for financial statements and financial reports can be done in time.

Our employees want the company to succeed and, on the whole, are willing to put up with a lot to ensure that outcome. But they have to be given some training with the new computerized accounting information system.

Finally, I believe we will minimize our costs and use funds more effectively than earlier.

I look forward to hearing from you. Thank you for your consideration.

Sincerely,
computerized accounting information system expert.