HA 2042 Accounting Information Systems
Accounting in large businesses demands many facilities because many legal and associated procedures of business are completely depended on it. The current report is created to study the importance of AIS for the business to find that how it supports the business operations. it is based on the Wesfarmers Limited and different AIS system are evaluated in respect of a company to identify the best accounting system suitable as per nature, size, and requirements of the business. This report will be made in different parts and each part will elaborate one different aspect of an efficient AIS system like possible cost, needed facilities, selection of the most suitable system etc. Practical knowledge of some real-life accounting software will also be elucidated here and at the end, a detailed comparison of different AIS system will be made to select and recommend the best AIS system.
It is a leading and well-known brand in Australia which is engaged in many sectors of retail business. Currently, this company is working in many countries including new-Zealand, Australia and UK. In 1914, it was formed as a Co-operative organization of Australian farmers to support their merchandise activities. In 1984 it becomes a listed company of Australian stock exchange and through continuous growth, became one of the largest players of the retail supermarket. According to the size of employees, Wesfarmers group is the biggest private employer in Australia in which 220000 peoples are working as employees (Wesfarmers limited, 2018). Wesfarmers has a diversified portfolio of businesses which covers more than 800 stores of Liquor, approx. 100 hotels, more than 900 retail supermarkets, and online business. A brief list of trade activities of Wesfarmers Limited is as below:
It was purchased Coles Group in 2007 for $ 22 billion and take over its large base of liqueur, hotel and retail chain stores. After this take over it entered the retail sector and become one of the most favorite choices for the consumers.
Chemicals & Fertilisers
Wesfarmers is also engaged in the sector of cement, fertilizers, and chemicals along with production and disbursement of gas resources. In this segment of business approx.1500 employees are working currently.
Wesfarmers is one of the largest producer and supplier of coal resources of Australia. The company is supplying its production in Asia, New-Zealand, and Australia for power generation and other domestic utilization (Wesfarmers limited, 2018).
Online business and other businesses:
Wesfarmers is also operating an online supply chain of consumable items which is very popular among Australian consumers. This segment of the business is selling many consumer durable items through an online platform. Additionally, it is also engaged in many sectors like insurance business, property management, automotive business services etc (Wesfarmers limited, 2018).
In the preparation of this report, two main segments of the business retail supermarket and online selling business are taken as an example to elucidate the AIS system requirements of the company.
- The key business process of Wesfarmers:
Business processes of an organization can be defined as a group of some activities and strategies that are planned and executed for the successful attainment of business aims. Wesfarmers is a leading company which performs many business processes under its trade activities. Specific processes depend on the nature of the segment which is going to be considered for the purpose of interrogation. Some main business process of Wesfarmers is as below:
Development of product:
Production development and creation is the primary business process for Wesfarmers Limited as it is engaged in the creation and selling of many products and services. In the segment of consumable items, consumer demands for the unique and customized products and, due to the presence of many global companies in Australian market final consumers have a big list of choices (Spacey, 2017). To handle this condition and reached the business goals, it is necessary that Welfares concentrate on product development to make more unique products.
Management of technology:
Technology is highly vivacious part of the business of Wesfarmers and well technology management is required as the primary business process for the successful attainment of planned ends. Technology management covers, many activities like the regular adoption of new and suitable technology in the production process to reduce the cost make the products highly suitable for consumer requirements (Bizmanualz, 2018).
Sales and marketing:
Sales are a most considerable matter for each business which demands the performance and future of business. Planning to improve the sales is most awaited part of business management to attain the aims timely. In supermarket business, preparation of discount, offer and fresh sales policy is required to improve the sales. Well, marketing is another vital part of Wesfarmers’s business process to ensure the achievement of goalmouths.
In the supermarket business, the company requires an additional stock of inventory items to regularly maintain its sales. Additional storage of items is also maintained by the Wesfarmers to handle the conditions of high demand and production crisis (Spacey, 2017). For example, In the case of chemical inventory, safe storage of inventory items is required for the safety of employees and cnsumers.
- Required outcomes form process:
Each business process is associated with aims of business in which they are performed. Wesfarmers
The process of product development is associated with quality control and management to assure that best product are delivered to the clients and company is gaining enough trust of consumers through it. In the sector of the retail supermarket, consumer demands for the fresh and unique products which will deliver them maximum satisfaction and it is only possible through the production of quality products (Awosejo, et. al., 2014). Delivery of satisfactory and good quality products makes the company high stable in the inexpensive market.
Cost refers to the amount of expenditure that was spent by a business to make a product or service saleable. The outcome of cost control is associated with each business process and essential in the attainment of targets. Each business process is required to be performed and managed as per the planned activities to maintain the cost of each effort at a low level so that business can gain maximum profits for its owners.
Capabilities or efficiency is most awaited aim of each business process in efforts of employees and execution of strategy which ultimately supports the attainment of planned targets. For example, good management of technology updates will enable the Wesfarmers to produce its products at low cost and unique manner and company will get the improved base of consumers (Gumel, 2017).
Wesfarmers Limited adopted the budgeting system to analyze its targets against real outcomes so that each and every discrepancy can be eliminated from the business. Attainment of the budgeted target is primary and desired outcome from the sales process of the company because it is necessary to ensure that company is gaining good revenue from sales operations and able to generate enough profits for the owners (Gumel, 2017).
Prevent harsh conditions:
As the market is uncontrollable and uncertain for each entity including Wesfarmers and prevents business from negative conditions is the most desired outcome from each business processes. Storage activities are necessary for each business and create numerous advantages for the related company. For example, by applying different inventory management systems Wesfarmers can easily handle the conditions of production stop or high demand (Awosejo, et. al., 2014). It is required to be considered that minimum loss through obsolesce is also the main outcome from storage activities.
Wesfarmers is a large company which covers a diversified list of business and nature of that business is totally different from each other. From example, the company is selling consumer durable items and also producing liquor products along with chemicals and fertilizers. These types of business companies demand customized system software to efficiently manage the operational and accounting issues (Roberts, 2018). Due to the global size and nature of businesses, it is necessary that company adopt a highly efficient Accounting system which also covers features of BRP system to ensure that all financial transactions are recorded by the adopted system in correct way. As all financial transactions are not made in one place, many additional IT features like cloud database, centralized processing, and password access is required to be available in such an AIS system. Some specific and required features of AIS system of Wesfarmers Limited are as below:
Automated processing of financial data is required in new AIS system of Wesfarmers Limited for the attainment of objectives for which company is thinking to invest funds in the adoption of IT system. For example, Wesfarmers Limited requires a system in which billing representative made bill for a purchase of goods of $ 1000 from the store of the company by entering data in system and rest of the required accounting processes like entry of sale, reduction in inventory balance and commission to related sales agent performed by the system automatically (Chand, 2018). This type of automatic processing is a necessary and basic element of the AIS system of Wesfarmers.
Each business segment of Wesfarmers Limited is managed by the central authorities so centralized processing is required in suitable AIS system of the company. Through centralized processing, a company can store more data in limited storage and remove the condition of data repetition (Roberts, 2018). It will also support the data filtering which is required to prepare different managerial and legal financial reports.
Wesfarmers is working with many companies to successfully operate its businesses and gain maximum profits from trade operations to ensure the best returns to shareholders. Data security is also a considerable and most required feature in new AIS system because the proper security of financial data of a company is required to handle the adverse market forces. Security of data along with password access enables the authorized management of financial data for the betterment of the business.
Wesfarmers have diversified list of administrative offices and stores which are part of the business of the company. Due to this, It is required that AIS system of company support the cloud-based computing so that required data can be access from different locations through password system without making any additional efforts (Roberts, 2018).
Large businesses like Wesfarmers have many internal processes and policies which makes them different from other companies. Additionally, each large entity including Wesfarmers Limited follows unique policies to handle its trades. This situation refers for the adoption of efficient customized software which was developed as per the specific requirement of considered business so that all recording and managing events of financial data can be completed with maximum accuracy and satisfaction (Chand, 2018).
Accounting Software can be defined as software for accounting solution which records and routes financial data as per the basic accounting functions. Accounting software is highly popular among each class of businesses because it creates many advantages like real-time processing, automatic comparison, the creation of managerial reports etc. In modern business time, Accounting software comes with many additional facilities like Following three types of major Accounting software are identified which are popular among Australian businesses:
It is accounting software that was developed with the aim of Mind your own business by the company MYOB. It is a leading and well-known software company which creates a different cloud, browser and physical adoption based Accounting and Tax assessment software systems for small and large scale trades (Canstarblue, 2018). The company is claiming that 60% of businesses and accounting consultants are using MYOB software systems as a primary tool to resolve their accounting and taxation needs. MYOB is regularly trying to enhance the usability of software by establishing a partnership with global players of financing segment like MYOB and PayPal made a partnership to support the E-commerce activities of software users.
The SAP is mainly German company which is engaged in the creation of different accounting and management system software. The success story of SAP in Australia is understandable through the fact that 75 SAP selling and development offices are working in the world to provide the best services to its customers. The SAP is especially known for the development of customized software systems which offers additional facility of resource planning in accounting software (Financesonline, 2018). SAP offers many software systems that are adaptable as per the nature, size, and requirements of the business.
It is a web-based accounting system which was specially developed for the small businesses to provide the facility of customized software in budgeted prices. It comes with the web-based assistance of Xero representative and delivers a real-time solution to small business managers for their issues of accounting (Financesonline, 2018). It is accessible by any device through an internet link and owners of growing and small business can adopt this system to manage their different financial management aspects like management of cash flow, recording of financial data etc.
Accounting needs depends on many factors and varies as per nature, needs, activities, and size of the organization. Accounting needs of an organization which has 100 or 200 employees will be different from that organization which is working with one or two lakh employees. Wesfarmers Limited is a large and listed company which is operating is trade activities in many counties and many sectors. Following three types of software are available in the market which can be selected by a business organization:
Low-end are those accounting software systems that are designed according to the needs of growing and small businesses and can be purchased from major software retailers by paying small licensing fees. These software systems are developed to satisfy the basic accounting needs of small businesses and can be adopted by any industry (Accountingsoftware, 2018).
Medium-end software is related to those medium businesses which have branches and stores at diversified locations. This type of systems gives many specific facilities to the users and made by considering the specific needs of related industry. Software which comes under the class of Medium-End, are suitable to manage the general and industry related accounting and financial management issues but it is not suitable for those businesses which require customization (Accountingsoftware, 2018).
Links for Us