1. Chapter 8 USING ACCOUNTING APPLICATIONS

2. Organization of Accounting Applications

3. Using Accounting Applications

4. Accounting Applications and Modules Purchasing module Sales module Inventory module General ledger module Payroll module Jobs/projects module

5. Accounting Applications and Modules Integration of modules Similarities across modules

6. Processing Modes 4 covered in this text: Immediate recording with immediate updating: real-time processing Batch recording (on-line) Off-line entry with batch recording Immediate recording with batch updating

7. Processing Modes Immediate recording with immediate updating – real-time processing Using the sales application Effect of recording and updating on data tables Prohibition against deleting posted event records Real-time system Status reports under a real-time system

8. Processing Modes Immediate recording with immediate updating – real-time processing Characteristics: Immediate recording As data are entered, there is an immediate edit Immediate update (posting) Posting to the general ledger module Event and status reports

9. Processing Modes Batch recording (on-line): Data entry steps 1. Accumulate a batch of source documents and calculate batch totals. 2. Enter each event in the batch using an accounting application. 3. Print an edit report of all events in the batch. 4. Review the report and make corrections. 5. Post the batch

10. Processing Modes Batch data entry: Edit report as a control

11. Processing Modes Effect of batch recording on tables: Invoice table before events are recorded Invoice table after events are recorded

12. Processing Modes Effect of posting on tables and reports: Batch posting as an internal control device Characteristics of a batch recording system

13. Processing Modes Effect of posting on tables and reports: Characteristics of a batch recording system 1. Event documents not recorded until batch is accumulated 2. Batch control totals calculated before recording events in batch

14. Processing Modes Effect of posting on tables and reports: Characteristics of a batch recording system 3. Batch control totals are entered into the system; batch# is assigned 4. Each event document in the batch is entered one at a time, edited, and compared to data in related tables

15. Processing Modes Effect of posting on tables and reports: Characteristics of a batch recording system 5. After all events in the batch are recorded, edit report is printed 6. Totals on the edit report are compared to the batch control totals; if agree and other data appear accurate, next step is taken

16. Processing Modes Effect of posting on tables and reports: Characteristics of a batch recording system 7. Batch is posted; posting date is recorded in the Post_Date field in the event records; summary fields in master tables are updated

17. Processing Modes Effect of posting on tables and reports: Characteristics of a batch recording system 8. Posting to general ledger module may or may not occur at the same time the event records are posted to the master records in the module 9. Event and status reports not up-to-date until batch is posted

18. Processing Modes Effect of posting on tables and reports: Benefits and drawbacks of batch recording

19. Processing Modes Off-line entry with batch recording: Events are recorded electronically but without the use of the main computer Data entry controls such as record checking are not available

20. Processing Modes Off-line entry with batch recording: After batch is recorded off-line, it is uploaded to the main computer and checked Report of all the errors detected is printed, corrections are made, and batch is resubmitted

21. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 1. No batch totals are taken 2. Events are recorded as they occur

22. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 3. Form used contains a “save” button 4. System checks are done as records are being entered

23. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 5. Event records are added to the event table. 6. After several events have been recorded, a list of unposted invoices is printed

24. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 7. List of unposted event records is checked for accuracy but no comparison is made of report totals to batch control totals

25. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 8. If recordings appear to be accurate, the group of unposted event records is posted to the master tables in the module

26. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 9. Upon posting Set Post_Date field in event records to the current date Summary fields in the master table are updated

27. Processing Modes Immediate recording with batch updating: Procedures in a batch update system 10. After posting, status reports in the module is up to date 11. Event records may or may not be posted to the general ledger

28. Using Accounting Applications: Additional Issues Posting to the general ledger: Sales module General ledger module Integration of sales module with general ledger module – 2 options

29. Using Accounting Applications: Additional Issues Posting to the general ledger: General ledger module – Option 1 System adds journal entries to Journal_Entry Table Updates account balances in general ledger as soon as batch of event documents is posted or event is recorded (in a real-time system) in the sales or other module

30. Using Accounting Applications: Additional Issues Posting to the general ledger: General ledger module – Option 2 When event records in sales module are posted, general ledger entries are created and stored in general ledger module

31. Using Accounting Applications: Additional Issues Purging 4 steps for purging event records: 1. Make sure all event records in the module have been posted to the module’s master tables and to the general ledger 2. Print event and ledger reports

32. Using Accounting Applications: Additional Issues Purging 4 steps for purging event records: 3. Identify records to be deleted; then archive them to off-line source 4. Delete event records are no longer needed

33. K E Y T E R M S Accounting application Archive Batch Batch recording Batch total Batch update Edit report Hash total

34. K E Y T E R M S Module Off-line On-line Posting Processing mode Purge Real-time system Record count