Question

reconciliation of cost and financial accounts in the modern computer age is redundant . comment​

Answer 1

Where cost accounts and financial accounts are separately maintained in two different sets of books, the profit or loss shown by one may not agree with that shown by other. Therefore, it becomes necessary that periodically the profit or loss shown by the two sets of accounts is reconciled.

A memorandum of reconciliation is prepared showing the reasons for difference between the results disclosed by each system. It is done to check the arithmetical accuracy of both sets of accounts as well as to detect mistakes committed in the accounts.

Answer 2

Reconciliation of cost and financial accounts in computer age can be redundant as sometimes profit shown in one book does not correspond to other.

• Use of computer information and accounting software has significantly improved the financial and cost Accounting field in the new computer era.
• Computers run at a exceptionally incredible speed and can process bulky data in no time, producing generally precise and accurate output.
• When stored on a computer system, financial and expense records display the outcomes correctly and accurately, but the profit reported by one set of books may not match with that of the other set.
• The logical explanation for the profit figures dispute is the notable absence of such items that appear only in financial books and are not reported in cost accounting books.
• Similarly, certain items can appear in cost accounts but do not find a place in financial books, like rental income, dividends, fines, fees paid, etc.