Database for Accounting Information Systems
Before we continue to elaborate on what is a database for Accounting Information systems, we should know what Accounting Information Systems and Database is. An accounting Information System is a system that consists of a variety of information that has been compiled to produce the required information. The information processed in the Accounting Information System includes Sales of products, purchase of raw materials to suppliers, cash receipts for customers, and cash disbursement to the payroll system.
The information generated from these transactions is a very important part. The resulting information will be processed into useful knowledge in decision-making. An accounting information system will require various resources such as people, processes, technology, and data. People here are people who can process data or information, while processes are procedures in the business process that companies need to carry out existing activities in the company, and technology is the infrastructure needed to process data into information (hardware, software, and network). ), and data are organizational business processes. Each of these resources will help each other so that the Accounting Information System runs smoothly.
The purpose of this Accounting Information System is to process financial and accounting data to produce financial reports that can be used by managers or other interested parties to make business decisions. This system has 3 parts: transaction processing, financial report ledger, and management reporting. In general, this Accounting Information System has 5 cycles, namely the revenue cycle, the expenditure cycle, the HR payroll cycle, the production cycle, and the financial cycle.
We’ve talked about the definition and purposes of Accounting Information Systems, then what is a database? A database is a collection of information or data that is organized and stored in the system. This database is usually used to store, maintain, and access all kinds of data relating to people, objects/products, and other information. This information is collected in one place so that it can be managed easily. Easy management, referred to here, is easy to obtain information, analyze information, update information, and also delete information. So, it can be said that the database is an organized collection of information.
With Databases, many things in everyday life become easier and faster, especially in today’s all-digital era. In other words, using a database means many advantages, such as Minimum data redundancy, Improved data sharing and security, increased data consistency and reliability, Lower updating errors, etc.
The easiest example of a database to find in everyday life is the database in a supermarket. When we want to pay for the goods we want to buy, the cashier only needs to scan the barcode of the item, and information on the item, such as the name and price of the product, immediately appears on the cashier’s monitor without the cashier having to type the name and price of the product because the data and information of the item already stored in the supermarket system database.
Based on the explanation above, we can see that database and AIS are very much related and are much needed to strengthen one another. The database collects large amounts of valuable pieces of information about an organization that is stored in a system. According to this statement, the database helps simplify AIS’s job of analyzing, processing, manipulating, and storing their large amount of transaction information, making it easier to process the decision-making. The database also increases the efficiency in time and energy in processing the AIS’s pieces of information. Even though it contains billions of information, starting from the sales of products, purchase of raw materials to suppliers, cash receipts for customers, and cash disbursement to the payroll system, the database can hold all pieces more securely.
All the AIS information is programmed in a query language that allows the user to access, manipulate, and store the tables and data. As we mentioned, all this information is securely held in the database. What do we mean by more secure? It protects and prevents all information from potential viruses and hackers from outside of the organization. Of course, we wouldn’t want various editions of accounting information systems in our organization that demonstrate the versatility of their data manipulation capabilities and generate accounts receivable aging reports based on customer information, fixed asset depreciation schedules, reports on trial balances for financial reporting, customer lists, tax calculations, and inventory levels to be accessed by an outsider, right? It is why it is very important to have a database organizing your AIS’s pieces of information. Not only it increases the efficiency of both time and energy in processing, but it also enhances the security of its information.
References:
• https://www.oracle.com/database/what-is-database/
• https://moneyduck.com/id/articles/1117-contoh-sistem-informasi-akuntansi-pengertian- dan-fungsinya/
• https://pipeline.zoominfo.com/operations/6-benefits-of-using-database-management- systems-dbms
• https://www.investopedia.com/terms/a/accounting-information-system-ais.asp