Accounting information systems and their impact on internal control

It is a framework in which all the company's human and material resources are coordinated to collect, record, store and exploit all entered data

Amer Ibrahim - • Corporate finance management

External Audit and Audit and Accounting Information Systems :-

It is a framework in which all the company's human and material resources are coordinated to collect, record, store and exploit all the entered data, process it and convert it into useful information to achieve the desired goals and submit it to decision-making bodies at any time, including management, investors, partners, government agencies and others.

Thus, accounting information systems are considered one of the important tools to achieve the goals of companies, and they also have an effective role in making appropriate and rational decisions, but provided that such information is reliable.

Attributes of reliable accounting information :-

. It must meet the following conditions :

. Health, safety, error-free and predictive investigation.

. Interconnectedness.

. Precision.

. Observe the appropriate timing for it.

. The possibility of using them.

. Impartial and verifiable.

. Approved by the responsible authorities within the company.

The impact of the rise in the dollar rate on the Egyptian capital market :-

Due to the lack of products and the increase in demand for them, inflation rises, and here the state is trying to reduce demand by reducing the money in the possession of citizens by attracting them to deposit them in banks, and at the same time the state will have funds that enable it to provide strategic products and materials to citizens, so Egyptian banks raise the interest rate.

Since the Central Bank floated the pound after the rise in the dollar rate and no real mechanism was determined to calculate the costs of the import price, selling prices and net profit, this led to an increase in the value of materials and is constantly increasing, and thus the result will be unreal prices, less inventory and less financial liquidity, which will lead successively to a state of depression, economic recession and high inflation rates.

Here, I believe that the only solution is the free release of the dollar rate, the provision of a large amount of services and discounts, and the control of laws to protect society and preserve the poor and middle class in the state, and the state must implement many decisions and economic reforms, which if implemented accurately will attract foreign investments and the recovery of the Egyptian market.

The importance of quality accounting information :-

Accounting information systems are of great importance to many entities such as :

For management and investors :

It gives a correct and integrated picture of the company's status.

It gives a correct and integrated picture of the company's status.

Accounting information systems are in constant contact with the rest of the information systems within the company and through several communication channels for data exchange.

Internal Control System :

Accounting information systems provide many standards and tools that strongly and directly help to develop the internal control system and its methods.

Future planning :

It helps to anticipate the future events of the company in the most close degree, which contributes to the company's management exploiting all its resources and directing them towards the optimal use of them.

Benefits of Accounting Information Systems :-

As we said before... Accounting information systems are of great importance to several internal and external parties, as they achieve many benefits that meet their needs, including :

. It is useful in providing daily information about operations.

. It benefits decision-makers by providing them with all the accounting data and information they need to support decision-making.

. Enables officials to control and evaluate the company's activity and administrative activity during a specific period.

. Accounting information systems are useful when you want to follow a new accounting system within the company, as it provides him with all the information he needs.

. The accounting information system increases the efficiency of the company's employees and the optimal utilization of its human resources.

. Contributes to organizing work within the company, defining responsibilities and reducing errors.

. It is also useful in developing and innovating forms of products and services to suit the desires of users.

. The accounting information system enables officials to analyze the company's financial position and helps them identify its weaknesses and strengths.

. In the long run, accounting information systems help to improve a company's reputation and raise its market value and thus improve its profits.

. Systems link the company's goals, whether main or subordinate, with tools that help achieve them as quickly and as possible.

The impact of internal control on the quality of accounting information :-

In the modern era, the internal control system has emerged, which is used as the most important means of follow-up, control, examination and review of operations continuously, with the aim of helping management to make various financial decisions, and one of the main objectives of financial control and internal control is to preserve the capabilities and funds of companies from fraud and embezzlement.

Internal control is an activity independent of the company under the authority of the company's senior management, and plays an important role for the company's directors, employees, investors, government agencies or those dealing with the company.

During the past few years, many studies have been conducted that have proven the strong relationship between internal control and accounting information systems, which is a reciprocal relationship where they affect each other.

We can summarize the most important findings of these studies in the following points :

. Accounting information systems enable the internal auditor to prepare accounting and financial reports in a timely manner, which increases the effectiveness and efficiency of the internal control process.

. Accounting Information Systems sets a framework for the form of laws and principles that must be adhered to during the internal control system.

. The accounting information provided to the internal controller helps him to easily detect errors and manipulation, analyze the causes and methods of treatment.

. Accounting information systems is the most effective tool for the internal auditor to carry out his task efficiently.

. Companies that are subject to the accounting information system help the internal control process to follow up and audit all the company's various operations.

. It also allows the internal controller to shorten his effort, time and the company's money consumed in the internal control process.

. The accounting information system is a key partner for the internal controller, which helps him to develop his performance and raise the efficiency of his work.

. The report submitted by the internal controller under the accounting information system is more efficient and reliable than the reports prepared by traditional methods.

. The internal controller can adjust the accounting information system to suit the requirements of his task.

Internal control methods in electronic accounting information systems :-

Internal control in electronic accounting information systems is more important, as it records and processes thousands of operations on the computer, which means that recording errors are larger, and they are not available to everyone and therefore cannot be verified quickly as in the manual system, so the difficulty of this internal control process led to the possibility of exposure to embezzlement and theft at a greater rate.

Modern companies have realized this, so they have allocated a complete department or department for electronic data processing, whose task is to ensure the validity and integrity of data operations such as recording, processing and reports, and it also follows a set of internal control methods in electronic accounting information systems, including :

Methods of internal control of inputs :

. Ensure that the data required to be recorded is approved.

. Ensure that all data on your computer is transferred without loss or deletion.

. Correction of previously rejected data.

Internal control methods of processing :

. Ensure the applications used and the safety of their operation.

. Ensure that all processes are processed and that no operation is ignored.

Internal control methods on outputs :

. Ensure the accuracy and integrity of the outputs of the processed data.

. Confirm the permit for the circulation of outputs to the authorized entities only.

Methods of internal control of inputs :

If you are a business owner or startup, you will need to design your accounting information systems, which will suit the needs of your company and the nature of its work, do not carry them, so the Egyptian Certified Public Accountants office will save you any hardship.

Our office is not just an accounting office, but one of the largest accounting firms in Egypt and the Middle East, a team consisting of the best chartered accountants, consultants and certified specialists in accounting, legal, auditing and tax work.

Our team will help you design accounting information systems, as we provide many services such as :-

. Determine the objectives of the company and the nature of its work and design the appropriate accounting information system for it.

. Study its legal requirements and the compatibility of its accounting system with its organizational structure.

. Speed and accuracy in providing information.

. Integration and comprehensiveness of all data provided. .Design the records and documents required for the operation of the information system.

. Follow up the recorded data, ensure its integrity, and review it more than once.

. Determine the types and content of reports and determine who will be allowed to view them.

. Linking internal control processes with the system.

. Establish controls for control, correction, detection of errors and compliance with

international standards.

. Design systems for the collection, recording and processing of data.

. Designing systems for structuring, updating, storing and retrieving files.

. Making drivers and systems for internal control.

. Issue buy and sell orders, checks, shipping, and instant posting at the same moment.

. We provide all internal and external audit and tax services.

. Saving time and effort at appropriate costs for the services provided and not exaggerated.

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