Q.Explain the advantages of a Computerised Accounting System.

This essay question asks specifically for the benefits a business gains from computerising its accounts, building on the features and manual-versus-computerised comparison already studied.

A Computerised Accounting System offers a business several concrete, practical advantages once it is properly set up and operated.

It offers speed, since ledgers, the trial balance and the final accounts can be generated almost instantly once vouchers are entered, instead of taking the days a manual system might require. It offers accuracy, because the software performs posting, totalling and carrying-forward mechanically and consistently, minimising the clerical errors a manual system is exposed to. Its output is reliable, since it follows a fixed, tested set of processing rules, and it provides real-time, up-to-date information, allowing managers to check the current cash position, stock position, or a customer's outstanding balance at any moment rather than only at the end of a period. The same basic data can also be presented in a variety of useful forms — party-wise statements, stock summaries, group-wise expense analyses — without any extra manual compilation, and years of records can be stored on electronic media occupying far less physical space than bound manual ledgers, reducing paperwork. …

A common error is blending advantages and features into one undifferentiated list; an advantage should describe a practical benefit to the business (e.g. 'saves storage cost'), while a feature d …