Ecplain four advantage and disadvantage of accounting
Answers
Reliable accounting software is likely to benefit many businesses. However, such software sometimes comes with its share of problems, so it is important not to overlook the possible disadvantages.
Advantages of accounting software
Benefits of accounting software include:
simple data entry - it is typically fast, straightforward and only required oncefast processes - delays, for example between sale and invoicing, are minimalautomation of reports and analysis - eg on profit and loss, debtors and creditors, customer accounts, inventory counts, sales, forecasting, etcautomation of tasks - eg calculating pay, producing payslips, calculating VAT, etcreduction of errors - eg transposition of figures, incorrect or incomplete recording of transactions, etcintegration with other systems, such as online banking and e-filing
Using accounting software can help you save time and money, and o
Offer you valuable insight into your business. If you choose the package carefully, investing in a computerised accounting system can be one of the best decisions you can make for your business.
DISVANTAGE OF ACCOUNTING
Certain problems and disadvantages are worth considering if you are looking to use accounting software in your business. For example:
Price - the package cost, although small in relation to your other costs, is higher than a paper-based system.Implementation - manual accounts are generally easier to set up and can be more flexible than computerised accounting. You will probably need some initial help setting up accounting software. Your accountant or system provider will usually charge you for this service.Support - you may need to purchase yearly maintenance and support for your package.Specialised needs - an accounts package will typically suit most types of business. However, specialist businesses may need to refine the package or change their processes to use accounting software successfully.
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Advantages of accounting :-
♥ The financial position and performance during and at the end of the accounting period is known .
♥ Helps the management to make business plans , takes decision and exercise control over the affairs .
♥ A systematic and timely recording of transactions obviates the necessity to remember transactions .
♥ Loan is granted by banks and financial institutions on the basis of growth of the business .
Disadvantages of accounting :-
♥ Even though most transactions are recorded on the basis of evidence , according isn't fully exact .
♥ Since they are prepared following the accounting concepts , according information may not be realistic .
♥ It ignores qualitative elements like quality or skills of management and staffs .
♥ Money doesn't remain stable , unless price level changes are considered accounting information will not show correct financial results .