Busivess Essay

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snisUnit 8: Unit code: QCF Level 3: Credit value: Accounting Systems F/502/5421 BTEC National 10 Guided learning hours: 60 Aim and purpose The aim of this unit is to enable learners to understand that recording year-end financial information accurately is vital to any business. This information can be recorded using manual or computerised packages, whichever is more suitable for business resources and needs. Unit introduction One essential requirement in running and managing of an organisation is the need for clear, relevant and accurate information. In particular, an organisation needs accounting information that gives a complete picture of all financial transactions that have taken place and the current financial position of the organisation. Accounting information is vital to the owners and managers of business organisations, and there are often other stakeholders who have an interest in the financial performance and position of the business. At an organisation’s financial year-end, the accountant will prepare financial statements including a trading and profit and loss account and a balance sheet. The system that provides all the information for these final accounts is known as the accounting system. The quality and accuracy of the information presented in the final accounts depends entirely on using an effective accounting system correctly. Beginning with the source documents that show financial transactions, accounting staff will need to classify and encode the information before inputting the details into the system. Manual accounting procedures, using double-entry bookkeeping, have been in operation for over 500 years. The system is still effective in providing managers with an analysis of income, profits, expenses, losses, assets and liabilities. However, organisations need information quickly and manual systems can be slow. Computerised

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