Components of a Computerised Accounting System

A Computerised Accounting System is not just "the software" — it is a combination of several elements that must all work together for the system to function properly. These are commonly grouped under five heads:

1. People (peopleware). The individuals who operate the system — data-entry operators, accountants, and the administrator who manages user access. However good the software, the system is only as reliable as the people entering and checking data into it.
2. Procedure. The set of instructions and rules that lay down how each type of transaction is to be recorded, who is authorised to enter or approve which kind of voucher, and in what sequence tasks are to be carried out. A clear procedure manual keeps the system consistent even when different people operate it.
3. Data. The source documents — invoices, receipts, payment vouchers, bank statements and similar records — that supply the raw information to be entered into the system. Data is the actual substance the whole system exists to process; inaccurate source data produces inaccurate accounts however good the software is (a principle summarised as "garbage in, garbage out").
4. Hardware. The physical equipment on which the system runs — the computer itself, along with peripherals such as a printer (for vouchers and reports), a scanner (for storing supporting documents), an uninterrupted power supply, and networking equipment where several computers share the same accounts.
5. Software. The accounting program itself — the set of instructions that actually performs the recording, posting, calculation and reporting once data and commands are fed into it through the hardware. …