Accounts 12 (1) · Section 1

Applications of Computers in Accounting C omputer technology and its usage have registered a significant development during the last three decades. Historically, computers have been used effectively in science and technology to solve the complex computational and logical problems. They have also been used for carrying out economic planning and forecasting processes. Recently, modern day computers have made their presence felt in business and industry. The most important impact of computers has been on the manner in which data is stored and processed within an organisation. Although manual data processing for Management Information System (MIS) has been quite common in the past, modern MIS would be nearly impossible without the use of computer systems. In this chapter we shall discuss the need for the use of computers in accounting, the nature of accounting information system and the types of accounting related MIS reports. . Meaning and Elements of Computer System A computer is an electronic device, which is capable of performing a variety of operations as directed by a set of instructions. This set of instructions is called a computer programme. A computer system is a combination of six elements: . . Hardware Hardware of computer consists of physical components such as keyboard, mouse, monitor and processor. These are electronic and electromechanical components. LEARNING OBJECTIVES After studying this chapter, you will be able to : • state the meaning, elementsand capabilit- ies of computer system; • explain the need for computers in account- ing; • describe the automa- tion of accounting process; • explain design of accounting reports from the accounting data; • list the various Management Informa- tion System (MIS) reports and their uses; • explain the data interface between information systems. © NCERT not to be republished