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Vol. 10 No. 4 November 2012

Designing of Accounting Information Systems: Major Challenges

Md. Ahasanuzzaman Assistant Professor, Department of Accounting, Rajshahi College, Rajshahi.


This paper aims to present the role of Accounting Information System (AIS) and the various users like internal and external, their requirements along with the application of AIS tools and techniques in the business enterprises. The significance of the study shows that AIS focuses attention on where that information comes from. It emphasizes on how to collect, store and process that data needed by management through seeking most effective ways but timely, accurate and reliable information system. It adds value to a business through improving products or services increasing efficiency and processing timely and reliable information to develop management process. The representation of an information system comprises user decision, information output, processing, data and data collecting etc. Information is some tangible or intangible entity that reduces our uncertainty about some state or event. AIS are grouped into five major cycles. These are revenue cycle, procurement cycle, production cycle, personal cycle and financial management cycle. In our business enterprises, the internal control procedures in each of these cycles are very much systematic. Developing purchase order, vendor selection, inventory control payment of invoices after review etc. are found in procurement control activities. Regarding production control activities production planning system, physical security, and documentation are also methodical. Revenue cycle follows credit approval, authorization and documentation for shipping, timely billing on the basis of sales order, accounts receivable, preparation of statement of accounts etc, Payroll cycle follows documentation, recoding of hours worked, disbursement of cheques etc.

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