Role of Accounting Information Systems

Accounting Information Systems (AIS) are a subset of a company's total Management Information Systems. Companies use the MIS to aid their business decisions and ensure profitable business operations.

History

The classic AIS included paper ledgers that contained all financial transaction of a company. With the growth of technology over the past several decades, accounting software has replaced the old paper system.

Features

AIS software has two main features: financial transaction recording and financial information reporting. After accountants input financial transactions into the AIS, reports can be generated to review this information.

Considerations

Company management must decide how large the AIS will be and what type of information must be collected. Information may be recorded electronically, bypassing human input and allowing managers quicker access to select information.

Benefits

Many AIS programs are web or server based, allowing managers to gather and review financial information from multiple locations at one time. Centralized reporting can shorten turnaround time for implementing changes in business operations.

Warning

Failing to review the information collected and reported may hamper the effectiveness of the AIS. Ineffective AIS programs create a "garbage in, garbage out" environment, causing delays for management decisions.

References

• Youtube: Introductory Lecture on Accounting Information Systems
• Business Dictionary: Accounting Information Systems