Integrated Accounting Cycle Final Report
Essay Preview: Integrated Accounting Cycle Final Report
Report this essay
Integrated Accounting Cycle Final Report
As a company expands and grows it is imperative to introduce an integrated accounting information cycles system. The main feature of an integrated accounting information system is that information is entered once and is shared with other modules, including the general ledger (Demand Media, 2013). Such technology and integration of the accounting cycle may even determine the failure or success of a company, because accuracy in reporting and real- time information can have a tremendous impact on a companys outputs. The following report details how the systems development life cycle (SDLC) can be applied to the conversion cycle as it pertains to Riordan Manufacturing. It includes the proposed changes to the companys current technologies and improvements to their current measurements and controls of their operations performance within the conversion cycle.
Systems Development Life Cycle
The conversion accounting cycle is just one of many accounting cycles that make up the accounting practices and reportings that encompass a companys inner financial life. As discussed in previous assignments the accounting information system (AIS) includes periodic and real-time reporting mechanisms, which interface with many modules and systems.
Currently Riordan Manufacturing does not have a functioning integrated accounting system with regard to the conversion cycle. Entering data, such as invoices and making adjustments to credits and debits is considered a very low risk operational duty that follows the existing business flow of the conversion cycle, but the companys different locations do not share their data through one system. If Riordan Manufacturing was to introduce a new business process through an integrated accounting cycle, the Systems Development Life Cycle (SDLC) is a step by step process that will enable Riordan Manufacturing to introduce the system successfully without negatively affecting daily processes.
Any proposed change to the system would first enter the planning phase. This step identifies the projects goals and projects feasibility. The team suggests the introduction of an ERP module for cost accounting. Once the change is deemed feasible the change is established as a project, where business process, and data analysis is conducted. Requirements are gathered from project stakeholders and these requirements are collected and inserted into the project and identified as requirements by the process analysts. Next the project enters the systems design phase of the software development lifecycle. In this phase the data analysts converts the business processes into data processes and applies the appropriate application controls to the process flow of data throughout the system. The project enters implementation in which the business processes and their corresponding data flow processes are developed into an automated solution. Once the software development is completed the new automated process is thoroughly tested to identify bugs or errors and ensure that the new application does not conflict with any of the existing applications and business process flows which currently operate within the environment. Once testing is completed the new automated process is installed and made available to Riordans operational end users.
Throughout the remainder of the project lifecycle the project has entered what is called the maintenance phase. Here the application is established in the production environment and where the application will live out the remainder of its life. During this time the application will undergo software and configuration changes, add additional functionality or, migrate to different systems and hardware (Kay, 2002). It will continue to exist in this phase until the application is retired or replaced.
Development of System
Riordan will engage a Study Team and a Steering Committee from each branch identified as “Users,” and those directly affected by the new system. According to (Bagranoff, Simkin, & Wiley, 2008), an interdisciplinary study team, stems from the need for a broad viewpoint when performing a new planning and design process. The study also serves to correct the problem identified in the chapter quote–thinking that the system belongs only to the IT staff (pg. 311). The Accounting Branch Officer and manager along with data entry specialists will provide its investigative study findings of the present fragmented processes and weaknesses of the three current systems. The team has suggestions for a new process that are beneficial to the organization, which would incorporate a comparable accounting system.
The new system design objective allows remote data entry automatically transmitted to dedicated servers with coding per location and branch. For the study team to do an adequate job–for example, determine the actual problems within a companys information system–its members must first understand the systems goals. Of special importance is determining which goals are not currently achieved under the present system and why this happens. Organization goals include: (1) general systems goals, (2) top management systems goals, and (3) operating management systems goals (pg. 312). The AIS is designed to update concurrent sales, and inventory transaction with trial enabling trial balances reports available at the end of the working day.
Riordan has been plagued with the various locations using sub-standard, antiquated Accounting Information Systems (AIS) that lacked global cohesion and capability. The objective is to bring the organizations finance and accounting systems into the Twenty First Century using processes that provides accurate financial information for middle and upper management.
The competitive spirit Riordan Manufacturings regions have garnered large revenues, which enabled company expansion and captured a larger segment