Accounting Information System The Current Scenario

Question: Describe about the Accounting Information System for The Current Scenario. Answer: Introduction The world in the current scenario is running in a high progressive environment and every organization operating in this environment needs to use the scarce resources available to them efficiently to maximize their profit. With the introduction of new competitors in the market, every industry requires to maintain competitive edge through better quality standards, on time delivery, after sales service and a healthy working environment to keep on track with the market. Any firm not able to meet these criteria gets eliminated from the market. The topic deals with the organization named Boston Manufacturing Company, a medium sized organization concerned with the production of machine tools. The problem faced by this firm is that for the past two years the net income has decreased appreciably due to an increase in the operating cost and cost of sales. The order fulfillment time of this firm has also become very lengthy leading to missing out on the deadline of delivery. The firm also faces problems due to huge daily orders and due to processing sales error. The study will now determine the how the organization will improve the accounting information system in order to gain a substantial development of the infrastructure of the firm, which will be crucial in eliminating the faults and errors the firm was having, which lead to the fall in the net income of the firm. Analysis Boston Manufacturing Company, a medium sized firm producing machine tools has been going through a tough time due to fall in the net income for the past two years. The firm is going through such a phase due to inefficient work process and errors in the production function. It was detected that due to inefficient Accounting Information System, the firm had been going through such a phase. A proper analysis of the problems led to the answer that the main root of the problem was due to outdated AIS system. The management of the organization thus decided to introduce an efficient AIS system to eliminate all the errors and faults detected in the organization. The management decided to take initiative for a sustainable growth in the sales by providing product demand information, technological developments, competitors marketing plan etc. It was decided to supervise and control the costs related to the productivity of the employees and maintain a proper inventory level. Customers are the primary source of income for every firm and so maintain high-level customer satisfaction through on time delivery of shipments is also necessary. All these methods can be obtained if the firm implements an advanced information system for accounting enabling them to provide relevant information to the managers for decision-making and to implement any modern techniques or systems, which will increase the competitive edge of the organization through increase in the income over the expense. The estimated cost for the implementation of the system along with the other expenses of the organization consisted to$ 271,000 and the benefit reaped out of it every year w as predicted to $ 164,000. The objectives of a redesigned and updated information system in the organization are to bring in organizational changes through collection and storage of vital data about the operations and transactions. It transforms the records into information, which will be advantageous for the management while taking business decisions. The AIS also gives adequate restrictions to safeguard the interests and assets of the organization. The designing of the AIS system is through analysis of the strategies, organizational structures and information technology. A good AIS process will add value by giving the exact and timely information so that the value chain activities can perform more effectively and efficiently. The process also increases the sharing of knowledge among all the departments thus improving the work culture of an organization (Hall, 2012). The assumptions and constraints, which Boston Manufacturing Company needs to take into consideration, are like finding out the motivation and attitudes of the employees with the introduction of the new system. The employees may require proper training to increase their skills towards this system. The organization also needs to focus on the source of funding for the implementation of the process and also to see to it that all the resources used for the production functions are optimally used as resources are limited. Any unlikely risks like accidents and natural calamities also need proper supervision as such constraints harm the function of the organization (Prasad, and Green, 2015). The personal and cost requirements for the implementation of the ideas mentioned by the management of Boston Manufacturing Company includes proper supervision from the top level management to the employees concerned in working out this process. The employees need to be motivated so that they have a sense of responsibility among them to efficiently work out the plan. A proper link between the different levels of management will induce the method efficiently. Boston Manufacturing Company needs to estimate costs for development of high level customer service, implementing new technologies and to incorporate new information systems from time to time in order to maintain he competitive edge in the market. The equipments needed for the implementation of the ideas discussed by the management involves the use of advanced accounting systems, along with accounting techniques to evaluate the production cost and keeping track of the inventory levels (Abbasi, 2014). The organization also needs to analyze methods, which will be beneficial for reducing costs like implementation of cost effective machine and providing proper training to the employees so that the level of errors decrease and thus reducing costs. The organization also uses methods of better supervision to detect any wastage of the resources (Ibrahim, 2013). Thus, from the above assessment it can be stated that Boston Manufacturing Company needs to implement new and improved AIS in order to reduce the errors and faults thus reducing the operating costs and cost of sales therefore increasing the net income of the organization. The firm can also thus implement all the ideas discussed by the management Recommendation The above study reveals the fact that Boston Manufacturing Company can increase the its net income through the reduction of their operating costs by eliminating all the errors of late delivery and lengthy output time. Such a case can be done through the implementation of an advanced AIS, which in turn will not only eliminate all the errors, but will also help the firm to gain competitive edge over its competitors. Reference List Abbasi, H., 2014. Role of Management Accounting Information System in Organizations.Journal of Business and Technovation,2(1), pp.96-102. Al-Hiyari, A., AL-Mashre, M.H.H. and Mat, N.K.N., 2013. Factors that affect accounting information system implementation and accounting information quality: A survey in University Utara Malaysia.American Journal of Economics,3(1), pp.27-31. Amran, A.M., Rahman, R.A., Yusof, S.N.S. and Mohamed, I.S., 2014. 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