Transactional Processing
The accounting software packages developed and distributed by Sage and Microsoft, respectively, each use their own methods for recording accounting information.
Sage 50. There are three different areas which must be discussed. These are the revenue, expenditure, and financing cycles. These areas are written about from the author's own knowledge from using the software, as learned from the book by Carol Yacht (2013).
Revenue cycle. For revenue cycle recording, Sage 50 allows the user to go through a pipeline of stages which need to be accomplished. The user enters customers into the system. The system keeps track of customers individually. This information may be updated in the future. The user may then walk through the revenue cycle by entering sales orders, sending customers invoices, and entering the receipt of payment into the system. All of these steps are neatly organized in order in the software window.
Example. For example, if a user needed to enter the sale of a product on credit to a customer, if the customer has already been entered into the system and the inventory item is already set up to be tracked by the system, the user would need to enter the customer and what was sold and any additional information which differs from defaults. If the sale was preceded by a sales order, the product information can simply be imported from the sales order. The user can then print the invoice, send it to the customer, and wait for payment to come.
Expenditure cycle. The expenditure cycle's recording is facilitated by Sage 50 in the same way as the revenue cycle. The user enters vendors into the system. These vendors are tracked individually by the system. The information on vendors can be updated at any time in the future. The user may record purchase orders, bills, and payments made. Both the revenue and expenditure cycle components keep track of what is happening to inventory.
Example. If a user wants to pay for a product for which his or her company has already been invoiced and which the company has received, the user need only enter the vendor and the invoice being paid. The software already has this information stored. Then the user can print a check and send it or use electronic payment.
Financing cycle. Financing activities involve such things as investments in and withdrawals from companies by owners and borrowing and repaying debts. Sage 50 allows users to record receipts separate from customer receipts which can be credited to an equity account to represent investment or to a liability account to represent the borrowing of money.
Finally, I will do a financial forecast in order to figure out firms’ ability to repay its loans. I will use simple percentages-of-sales forecasting technique. I will use existing trends in my forecast to show the implications of current policies before making my own recommendations. During my forecast I will use New Era Partners loan to find out the interest rates. I will make the short-term debt as my plug.
Romney, Marshal, and Paul Steinbart. Accounting Information Systmes. 10th ed. Upper Saddle River: Pearson Education, 2006. 193-195.
Accuracy: All Purchases are authorized at the appropriate level. All invoices prices and quantities are compared with purchase orders and receiving reports. Journal entries are review at the appropriate level. All the Financial statements are review and approved by the senior level.
In order for the SAP system to be used effectively at Novartis, they must first re-design the invoice process to better integrate with the software. Currently, the process is inefficient and is thus resulting in a backlog of overdue bills. By focusing on business processes first, Novartis can eliminate this concern, ensuring the system automatically makes payments before they are due.
Accounts Receivable has good separation of duties and strong internal controls such as control numbers and reconciliations to sales and bank statements. One weakness in the Accounts receivable system is the accounting supervisor approves summary entries and reconciles the general ledger account, which could indicate a weakness with segregation of duties. We recommend that the controller approves of summary entries to segregate these duties.
To counter this problem, computer assisted audit techniques have been developed. These systems are able to provide a more in depth analysis of the utilized billing systems. Computer assisted audit techniques also enable highly efficient assessment of transactions. By utilizing this system, an auditor could gain a clearer picture of the revenue reporting mechanisms that are being utilized by the business office. Once the information is derived, however, its interpretation, while simpler, will still require an individual that is knowledgeable in regard to the revenue cycle
"College Accounting Coach." Process Costing-Definitions And Features(Part1) « Process Costing « Cost Accounting «. Feb. 2007. Web
The Six stages of the revenue cycle are provision of service, documentation of service, establishing charges, preparing claim/bill, submitting claim, and receiving payment. The first step consist of providing the ...
The revenue cycle is a process the business will use to measure or describe the company’s financial progression of the accounts receivables. This process starts when the business first attains the product(s) and then tracks the account until the company is paid or if the company is paid in full. In every business they have to keep track of who the customer is, the customer invoices, the customer payments and any other information relevant to the customer and their account with the business. With Peachtree Accounting software is will help the business keep track of all this information stated above, along with the business would be able to run reports for information about the businesses. The accounting software will also run reports on key revenue cycle information like sales, accounts receivable and cash accounts.
Xero’s Vision is to be “The global leader of small business accounting” and its Mission of “Grow prosperity by connecting people, money and resources with beautifully designed software“(Xero Briefing, 2012, pg.29). Xero’s main focus lies with how the customer can best interact with its software to make it user-friendly and at the same time powerful.
One of the most important steps in the capital budgeting cycle is working out if the benefits of investing large capital sums outweigh the costs of these investments. The range of methods that business organisations use can be categorised in one of two ways: traditional methods and discounted cash flow techniques.
Every transaction gets entered twice in financial records. If one day you sold three gold coins ' worth of pepper, you would write that the amount of cash you had went up by three gold coins. You would also write in that the amount of pepper you had went down by three gold coins ' worth. Before double-entry, people just kept diaries and counted their money at the end of the day. This innovation allowed merchants to see every aspect of their business in neat little rows. (Kestenbaum,
...are making the business financial report. The department should use a system which can immediately mark the invoice and documents while the cheque is sending to the vendor.
and is especially popular among eBay customers. Fig.1 briefly illustrates Company’s business. The system enables its
E-commerce application is a platform where there is buying and selling of products and services which are done by businesses and consumers via an electronic medium, mostly without using any paper documents. “E-Commerce applications support transactions between businesses and their customers. They provide 24/7 customer support, allowing customers to order products, check orders and track shipping, review previous orders, reorder products, and manage their accounts.” (Auburn SeeWolf llc , 2009-2012)