Accounting Systems Essay examples

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Accounting information – Coursework Some academics believe that there is a direct relationship between accounting information systems and organisations. It is thought there is a two-way system whereby organisations shape their accounting information systems but are also shaped by them. This report will look at the highlighted relationship and in the context of the information literacy and management skills that are needed by an accountancy graduate in the 21st Century. The report will also cover the importance of the factors that shape an accounting information system and what the needs are essential to have an effective and efficient system in this present day. The purpose of accounting information systems is to support management…show more content…
When management are compiling the appropriate accounting information systems they must be aware of internal controls. Internal controls can be defined as “an accounting procedure or system designed to promote efficiency or assure implementation of a policy or safeguard assets or avoid fraud.”(Princeton University, 2012) Management or directors are usually responsible for developing and monitoring internal control and factoring in the five components. These components are known as the control environment, risk assessment, control activities, communication and monitoring. The main component for the internal controls is the control environment as it provides a base for the organisation. The purposes of the control environment is for manager’s oversight, integrity and ethical principles, attention and direction by the board of directors. The control environment is one of the most crucial factors of internal controls as fraudulent financial reporting usually comes from the ineffective control environment. According to Hopwood, “audit industry is currently in the midst of intensifying its lobbying of government for legislative changes in the limits on its legal liability.” This conveys the idea that auditors today have not got enough authority or availability to company’s information systems and that is the reason for the problems. Another component of

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