What Are The Effects Of Accounting Information System On Decision Making?


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Benedict Buchanan Profile
Accounting information systems existed on paper and via communication between the CEO and Financial Controller for a long time. In making such systems digital the help of spreadsheets and computer automation can speed up tedious tasks and allow more instant feedback but may just as well confuse management if the data is not well presented.

The attached graphic shows how a CEO thinks of the money flow and his or her relationship with the Financial Controller.

Bear in mind that the PC is a crude device chained to a desk. In the near future digital paper will allow digital reports to be produced that can be carried around the office and interacted with directly. At such time Financial Controllers and CEOs will get back very much more readily to the old ways before PC's chained everyone to the desk during working hours.

Business is still very much about people. It's who you know and what you know and for the CEO the people who he knows are the Board and the Management. Accounting Information Systems should speed up decision making and make analysis less tedious, that is where digital systems work well with human requirements. If the systems try to fully do the job of the people, then we can all quit work tomorrow... But what would we do with all that time on our hands? Probably investing... Which distances people from knowing where their money is being spent.

In the age of terrorism and bank account freezes, it's best to know where every dollar you have comes from and where it goes to. Accounting Information Systems can help with this too. See attached...
Ellie Hoe Profile
Ellie Hoe answered
Accounting information aids in organizational decision making as it enables the organization to have complete knowledge and critical insight of financial prospects. Accounting information systems help financial managers in investment and financing decisions. It helps to analyze whether company should invest in short term securities to meet its liquidy conditions or should it make long term investments to get higher returns on invested capital. It helps management to analyze which modes of financing are preferable to suit to the company's financial needs. Accounting information system enable the organizations to identify loop holes in the company's cost structure.

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