2. Chapter 6 Accounting and Enterprise Software
Introduction
Integrated Accounting Software Programs
Accounting Software for different sized businesses
Specialized Accounting Information Systems
Enterprise-Wide Accounting Software Solutions
Functionality and Architecture
Business Processes and the Risks and Benefits of Enterprise Resource Systems
Selecting Accounting And Enterprise Software
The when and how of selection

3. Introduction Accounting software Specialized accounting software
earlier
primarily processed bookkeeping transactions earlier
today
processes transactions for multiple corporate divisions
customizes financial reports
provides sophisticated ratio analyses and
performs forecasting functions.
has evolved into a part of integrated enterprise software
Specialized accounting software
accommodates specific industry information needs

4. Integrated Accounting Software Programs
process all types of accounting transactions
include transactions affecting accounts in the general and special journals
organize transaction processing in modules and provide links among the modules
general ledger module includes the chart of accounts
other modules usually include accounts receivable, accounts payable, inventory and payroll
journal entries recorded in modules update the ledger module

5. Integrated Accounting Software Programs - Features
Can handle multiple companies and users
Has audit trails
Has budgeting capability
Provides cash-based and accrual-based accounting options
Can print checks and invoices
Can customize financial reporting

6. Integrated Accounting Software Programs - Features
Has E-commerce features
Has tools for financial analysis
Can generate graphic reports
Can manage the inventory
Can handle recurring journal entries
Accommodates business growth
Can provide variance analysis.

7. Small Business Accounting Software
Small business owners are usually most concerned with
cash flows and
figuring out if they have been profitable.
Small Business Accounting Software available in the market include
Microsoft Small Business Accounting
Quickbooks by Intuit
Peachtree products

8. Small Business Accounting Software
Microsoft Small Business Accounting gives, at a quick glance
cash flow trends,
vendor bills due,
overdue customers, and
bank account activity.

9. Small Business Accounting Software
Quickbooks by Intuit includes
a low-end package and an enterprise-wide software package
a chart of accounts and process general ledger,
accounts receivable, and
accounts payable transactions.
Peachtree products include a
variety of features offered in packages
Internet connectivity, to create web sites and engage in electronic commerce.
a special link to take orders and receive payments over the Internet.

10. Small Business Accounting Software
Question
Low-end accounting software is increasingly complex and sophisticated. However, software costing only a few hundred dollars is not likely to
a. provide information to multiple stores where a company operates more than one.
b. include a chart of accounts that users may customize to suit their industry.
c. provide all the information needed to optimize customer and supplier relationships.
d. provide information for budgeting decisions.

11. Mid-Range Accounting Software
A mid-range software package is useful when transaction processing needs
grow in volume and
increase in complexity.
Some examples of accounting software packages of this type are
Microsoft’s Dynamics GP

12. Mid-Range Accounting Software
Sage software’s include:
MAS 90
MAS200
Everest
Accpac

13. Mid-Range Accounting Software
These software packages offer many features. They can
convert transactions from one currency to another
write checks in foreign currencies
split commissions among multiple salespersons
handle more than just accounting functions
be deployed from an array of options including
desktop computers, a web browser, or a hosted
solution

14. Mid-Range Accounting Software
Question
Mid-level accounting software
a. can only be deployed through a server networked with desktop computers.
b. may be purchased in modules that match various business processes.
c. will not be appropriate for a multinational company because these programs cannot handle foreign currencies.
d. is generally inappropriate for a company operating in a specialized industry, such as retail or not-for-profit.

15. Specialized Accounting Information Systems
Accounting software
began with programs written to automate common, repetitive transactions
has become increasingly sophisticated and customized for specific industries
offer add-on modules that can process special information.
are useful to manufacturers and construction companies, and point-of-sale features for retailers
sell source code with their programs to customize the software to fit specialized information needs

16. Enterprise-Wide Accounting Software Solutions
Enterprise resource planning (ERP) systems
are integrated programs with a central data base
do much more than process financial data
expand with the price and complexity of software
have the ability to interface with customers and suppliers (supply chain management).
ERP systems include
SAP
PeopleSoft
Oracle
Microsoft Dynamics GP Enterprise

17. Enterprise Resource System Functionality
Enterprise System Functionality:
ERP systems originated from manufacturing systems
MRP I Systems:
Marketing sales projections,
Production schedules
MRP II Systems:
MRP I plus forecasting
planning for all manufacturing resources including labor and overheads
ERP Systems combined MRP II systems with accounting and finance functions

18. ERP Functions
Traditional functions are concerned with back-office functions which primarily deal with internal systems, such as
Order processing and fulfillment
Manufacturing
Purchasing
Human resources

19. ERP Functions Intregrated functions Traditional capabilities plus
E-business
Customer management
Supplier management
Business partner management
Strategic business relationship management

20. ERP Functions Question
Which of the following is not a distinguishing characteristic of an enterprise-wide (ERP) system?
a. a central database
b. integration
c. best practices for business processes included in the software
d. hosted solution

21. Integration within ERP systems

22. Extended Enterprise Information System

23. The Architecture of Enterprise Systems
ERP Configurations
are client-server based
can typically run on many operating system platforms
Centralized database
stores information about each data item just once
makes it immediately available to all the various functions

24. The Architecture of Enterprise Systems
Application interfaces
a best-of-breed approach
extended application interfaces
Internet portals
Are gateways to other web sites
enhance communication and productivity among employees, customers, partners, and suppliers

25. The Architecture of Enterprise Systems
Question
Which of the following is correct regarding ERP systems?
a. Early ERP systems focused on back-office functions.
b. ERP systems evolved largely from a manufacturing environment.
c. ERP systems do not include CRM or SCM functionality.
d. Both a and b are true.

26. ERP Systems and Business Process Reengineering
An ERP typically integrates
financial functions,
human resource functions,
manufacturing functions, and
sales and distribution functions.

27. ERP Systems and Business Process Reengineering
Buying an ERP system
is akin to a new way of doing business
entails reengineering an organization,
encourages the separate units to conform to standard practices

28. Implementing an Enterprise System
Implementing an ERP involves:
systems planning,
forming the project team,
selection of the software and the consultant,
pre-implementation work,
follow-up after going live,
training of personnel, and
change in management methods, if warranted

29. Costs and Benefits of Enterprise Systems
Hardware
Software
Training
Technical
Business processes
Data conversion
Interfaces and customization
Professional services
Reassigned employees
Software maintenance
Software upgrades
Reduction in inventory investment
Improvement in asset management
Improved decision-making
Resolution of data redundancy and integrity problems
Increase in flexibility and responsiveness
Improved customer service and satisfaction
Global and supply chain integration

30. Selecting Accounting And Enterprise Software
Organizations have many choices when selecting AIS software:
Entry-Level
Simply Accounting
Peachtree
QuickBooks
Microsoft Small Business Accounting
High-End Enterprise Resource Planning (ERP)
SAP
PeopleSoft
J.D. Edwards
Oracle
Small–Medium Business (SMB)
Sage ACCPAC Advantage Series
Sage MAS 90
MAS 200
Macola ES
Cougar Mountain
NetSuite
Microsoft Dynamics GP

31. Selecting Accounting And Enterprise Software
Organizations have many choices when selecting AIS software:
Special Industry
Peachtree Nonprofit
Cougar Mountain Fund (NFP)
AccuBuild (construction)
Everest POS (retail)
Phoenix (insurance)
Small–Medium Enterprise (SME)
Sage MAS 500
e by Epicor
Lawson
Microsoft Dynamics AX
mySAP All-in-One
Custom-Built

32. New Accounting Information System
The time to purchase new software is when there is
a delay in payment of vendor invoices,
a delay in deliveries to customers,
growth in inventories, accompanied by an increase in stockouts,
a slowdown in inventory turnover,
increased time in collecting on receivables,

33. New Accounting Information System
a delay in periodic reports,
an increase in the length of time to close books,
concern about cash flows and the financial picture,
a lack of information needed for decision making, and
worry over taxes and profitability.

34. Buying Accounting Software
The approach to buying accounting software varies with the
complexity of the business and
features of the software.
At the low end, for small businesses, the approach is
much quicker and
less expensive.

35. Buying Accounting Software
mid-range or high-end accounting software packages are usually purchased from a value-added reseller (VAR)
VARs provide buyers with services such as installation, customization, and training
a VAR offers a broader array of services than a qualified installer

36. Buying Accounting Software
Large organizations with specialized needs
may require a custom AIS which
is easier to develop with advances in technology,
is, however, likely to be costly, but
will prove to be a good choice in the long run.
may manage with a packaged software for 80% of their needs.

37. Buying Accounting Software
Question
Accounting and enterprise software can be expensive. Which is likely to be the highest cost associated with a new AIS?
a. The cost of new hardware.
b. The cost of the software.
c. The cost of implementing and maintaining the new system.
d. The cost of converting old data for the new system.

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39. Chapter 6