An accounting information system comprises data inputs and outputs. Once data is entered into the system, it is organized into information outputs that a company can use to record and analyze various business activities. Sales, purchases, employees, and inventory are all examples of items that an accounting information system can track and report on.
Although the scale of an accounting information system depends on the specific needs of a business, the following are some standard output types from the system that all companies use.
1. Financial reports
A company's financial statements include the profit and loss statement, balance sheet, cash flow statement, and detailed notes. Internally, business managers and owners use financial statements to gain an overall view of the business's operations. External users, such as lenders and investors, use financial statements to assess a company's net worth and creditworthiness.
- The profit and loss statement shows revenue, expenses, and the net profit or loss remaining after expenses have been deducted from revenue.
-
The cash flow statement shows a company's cash inflows and outflows over a specific period. It also reveals changes in assets, the cashability of those assets, and the company's ability to pay its debts.
- The balance sheet shows the assets and liabilities, as well as the overall financial situation of a company.
Accounting information systems can generate any financial report for different periods, including real-time, daily, weekly, monthly, quarterly, or annual reports.
2. Sales invoice
The accounting information system manages sales data entered into the system, which then generates invoices based on orders and tracks the payment process. These invoices are used to track inventory and revenue activities and must be kept with the company's accounting records for verification, customer inquiries, and management confirmation.
3. Receipt/Payment slip
The accounting information system manages invoice payments, creating and issuing receipts and payment vouchers with crucial information such as the payment date and amount, which must be entered into the system. Payment information matches the paid invoice. In cases where a customer has more than one invoice, this process helps track and deduct payments accurately. Once payment information is entered, the accounting information system generates a receipt or payment voucher, which is provided to the customer and also saved in the business records for accounting purposes.
4. Information for management
While management can use any output of an accounting system for internal decisions, accounting information systems can generate other types of reports that are important to management. For example, each time a customer places an order, inventory or the parts used to fulfill the order are updated in the system. Management can use this information to determine when to order new inventory or materials. Additional examples of management information outputs might include performance reports, payroll reports, and delivery schedules.