Chapter 12: Applications of Computers in Accounting

1. Meaning of Computer

An electronic device capable of performing a variety of operations as directed by a set of instructions (program). Elements: Hardware, Software, People, Procedure, Data, Connectivity.

2. Management Information System (MIS)

A system that provides information for decision-making at all levels of management.

3. Accounting Information System (AIS)

A part of MIS. It identifies, collects, processes, and communicates economic information about an organization to various users.

  • Features: Reliability, Relevance, Timeliness, Accuracy.

4. Components of Computer System

  • Input Unit: Keyboard, Mouse.
  • CPU: Control Unit, ALU, Memory Unit.
  • Output Unit: Monitor, Printer.

5. Advantages of Computerised Accounting

  • Speed and Accuracy.
  • Reliability.
  • Scalability.
  • Security.
  • Real-time User Interface.