Accounting software is application software Application software is computer software designed to help the user perform a particular task. Such programs are also called software applications, applications or apps. Typical examples are word processors, spreadsheets, media players and database applications that records and processes accounting Accountancy or accounting is the art of communicating financial information about a business entity to users such as shareholders and managers. The communication is generally in the form of financial statements that show in money terms the economic resources under the control of management transactions within functional modules such as accounts payable Accounts payable is a file or account that contains money that a person or company owes to suppliers, but has not paid yet . When you receive an invoice you add it to the file, and then you remove it when you pay. Thus, the A/P is a form of credit that suppliers offer to their purchasers by allowing them to pay for a product or service after it, accounts receivable Accounts receivable is one of a series of accounting transactions dealing with the billing of customers who owe money to a person, company or organization for goods and services that have been provided to the customer. In most business entities this is typically done by generating an invoice and mailing or electronically delivering it to the, payroll In a company, payroll is the sum of all financial records of salaries, wages, bonuses and deductions, and trial balance A trial balance is a list of all the nominal ledger accounts contained in the ledger of a business. This list will contain the name of the nominal ledger account and the value of that nominal ledger account. The value of the nominal ledger will hold either a debit balance value or a credit value balance. The debit balance values will be listed in. It functions as an accounting information system An accounting information system is the system of records a business keeps to maintain its accounting system. This includes the purchase, sales, and other financial processes of the business. The purpose of an AIS is to accumulate data and provide decision makers (investors, creditors, and managers) with information. It may be developed in-house by the company or organization using it, may be purchased from a third party In the video game industry, a first-party developer is a developer that is part of a company that actually manufactures a video game console. First-party developers may either use the name of the company itself, like Nintendo; have a specific division name like Sony's Polyphony Digital; or have formerly been an independent studio before being, or may be a combination of a third-party application software package with local modifications In computing, internationalization and localization are means of adapting computer software to different languages and regional differences. Internationalization is the process of designing a software application so that it can be adapted to various languages and regions without engineering changes. Localization is the process of adapting. It varies greatly in its complexity and cost.

The market has been undergoing considerable consolidation since the mid 1990s, with many suppliers ceasing to trade or being bought by larger groups.

Contents 1 Modules 2 Implementations 3 Categories 3.1 Personal Accounting 3.2 Low End 3.3 Mid Market 3.4 High End 3.5 Vertical Market 3.6 Hybrid Solutions 4 Use by Non-Accountants 5 History 6 See also 7 References

Modules

Accounting software is typically composed of various modules, different sections dealing with particular areas of accounting. Among the most common are:

Core Modules

• Accounts receivable Accounts receivable is one of a series of accounting transactions dealing with the billing of customers who owe money to a person, company or organization for goods and services that have been provided to the customer. In most business entities this is typically done by generating an invoice and mailing or electronically delivering it to the—where the company enters money received
• Accounts payable Accounts payable is a file or account that contains money that a person or company owes to suppliers, but has not paid yet . When you receive an invoice you add it to the file, and then you remove it when you pay. Thus, the A/P is a form of credit that suppliers offer to their purchasers by allowing them to pay for a product or service after it—where the company enters its bills and pays money it owes
• General ledger The general ledger, sometimes known as the nominal ledger, is the main accounting record of a business which uses double-entry bookkeeping. It will usually include accounts for such items as current assets, fixed assets, liabilities, revenue and expense items, gains and losses. Each General Ledger is divided in two sections. The left hand side—the company's "books"
• Billing EBPP, or Electronic Bill Presentment and Payment, is a process whereby an organization or third-party outsourcing company makes invoices available electronically to its customers, along with the capability to pay these invoices and settle funds with the bank—where the company produces invoices to clients/customers
• Stock/Inventory Inventory is a list for goods and materials, or those goods and materials themselves, held available in stock by a business. It is also used for a list of the contents of a household and for a list for testamentary purposes of the possessions of someone who has died. In accounting inventory is considered an asset—where the company keeps control of its inventory
• Purchase Order A purchase order is a commercial document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a PO to a supplier constitutes a legal offer to buy products or services. Acceptance of a PO by a seller usually forms a one-off contract between the buyer—where the company orders inventory
• Sales Order The sales order, sometimes abbreviated as SO, is an order issued by a business to a customer. A sales order may be for products and/or services. Given the wide variety of businesses, this means that the orders can be fulfilled in several ways. Broadly, the fulfillment modes, based on the relationship between the order receipt and production, are—where the company records customer orders for the supply of inventory

Non Core Modules

• Debt Collection—where the company tracks attempts to collect overdue bills (sometimes part of accounts receivable)
• Electronic payment Electronic money refers to money or scrip which is exchanged only electronically. Typically, this involves use of computer networks, the internet and digital stored value systems. Electronic Funds Transfer (EFT) and direct deposit are examples of electronic money. Also, it is a collective term for financial cryptography and technologies enabling processing
• Expense In common usage, an expense or expenditure is an outflow of money to another person or group to pay for an item or service, or for a category of costs. For a tenant, rent is an expense. For students or parents, tuition is an expense. Buying food, clothing, furniture or an automobile is often referred to as an expense. An expense is a cost that is &—where employee business-related expenses are entered
• Inquiries—where the company looks up information on screen without any edits or additions
• Payroll In a company, payroll is the sum of all financial records of salaries, wages, bonuses and deductions—where the company tracks salary, wages, and related taxes
• Reports—where the company prints out data
• Timesheet Originally developed for an employer to determine payroll, timesheets are not just for payroll anymore. Timesheets may record the start and end time of tasks, or just the duration. It may contain a detailed breakdown of tasks accomplished throughout the project or program. This information may be used for payroll, client billing, and increasingly—where professionals (such as attorneys A lawyer, according to Black's Law Dictionary, is "a person learned in the law; as an attorney, counsel or solicitor; a person licensed to practice law." Law is the system of rules of conduct established by the sovereign government of a society to correct wrongs, maintain stability, and deliver justice. Working as a lawyer involves the and consultants A consultant is a professional who provides advice in a particular area of expertise such as management, accountancy, the environment, entertainment, technology, law (tax law, in particular), human resources, marketing, medicine, finance, life management, economics, public affairs, communication, engineering, sound system design, graphic design,) record time worked so that it can be billed to clients
• Purchase Requisition As part of an organization's internal financial controls, the accounting department may institute a purchase requisition process to help manage requests for purchases. Requests for the creation of purchase of goods and services are documented and routed for approval within the organization and then delivered to the accounting group—where requests for purchase orders are made, approved and tracked

(Different vendors will use different names for these modules)

Implementations

In many cases, implementation (i.e. the installation and configuration of the system at the client) can be a bigger consideration than the actual software chosen when it comes down to the total cost of ownership for the business. Most midmarket and larger applications are sold exclusively through resellers, developers and consultants. Those organizations generally pass on a license fee to the software vendor and then charge the client for installation, customization and support services. Clients can normally count on paying roughly 50-200% of the price of the software in implementation and consulting fees.

Other organizations sell to, consult with and support clients directly, eliminating the reseller.

See the article Comparison of accounting software.

Categories

Personal Accounting

Mainly for home users that use accounts payable Accounts payable is a file or account that contains money that a person or company owes to suppliers, but has not paid yet . When you receive an invoice you add it to the file, and then you remove it when you pay. Thus, the A/P is a form of credit that suppliers offer to their purchasers by allowing them to pay for a product or service after it type accounting Accountancy or accounting is the art of communicating financial information about a business entity to users such as shareholders and managers. The communication is generally in the form of financial statements that show in money terms the economic resources under the control of management transactions, managing budgets A budget is generally a list of all planned expenses and revenues. It is a plan for saving and spending. A budget is an important concept in microeconomics, which uses a budget line to illustrate the trade-offs between two or more goods. In other terms, a budget is an organizational plan stated in monetary terms and simple account reconciliation at the inexpensive end of the market suppliers include:

Low End

At the low end of the business markets, inexpensive applications software allows most general business accounting functions to be performed. Suppliers frequently serve a single national market, while larger suppliers offer separate solutions in each national market.

Many of the low end products are characterized by being "single-entry Most businesses maintain a record of all transactions based on the double-entry bookkeeping system. However, many small, simple businesses maintain only a single-entry system that records the "bare-essentials." In some cases only records of cash, accounts receivable, accounts payable and taxes paid may be maintained. Records of assets," products, as opposed to double-entry The origins of a primitive double-entry system may possibly be traced as far back as the Roman Empire, in ""ex Oratione Ciceronis pro Roscio Comaedo", and Naturalis Historiae Plinii, lib. 2, cap. 7 where the advised system was "That the one side of their booke was used for Debitor, the other for Creditor" .[citation needed] systems seen in many businesses. Some products have considerable functionality but are not considered GAAP Generally Accepted Accounting Principles is the term used to refer to the standard framework of guidelines for financial accounting used in any given jurisdiction. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions, and in the preparation of financial statements or FASB The Financial Accounting Standards Board is a private, not-for-profit organization whose primary purpose is to develop generally accepted accounting principles (GAAP) within the United States in the public's interest. The Securities and Exchange Commission (SEC) designated the FASB as the organization responsible for setting accounting standards compliant. Some low-end systems do not have adequate security nor audit trails.

Mid Market

The mid-market covers a wide range of business software that may be capable of serving the needs of multiple national accountancy standards and allow accounting in multiple currencies In economics, the term currency can refer either to a particular currency, for example the US dollar, or to the coins and banknotes of a particular currency, which comprise the physical aspects of a nation's money supply. The other part of a nation's money supply consists of money deposited in banks , ownership of which can be transferred by means.

In addition to general accounting functions, the software may include integrated or add-on management information systems A management information system is a subset of the overall internal controls of a business covering the application of people, documents, technologies, and procedures by management accountants to solve business problems such as costing a product, service or a business-wide strategy. Management information systems are distinct from regular, and may be oriented towards one or more markets, for example with integrated or add-on project accounting Project accounting is the practice of creating financial reports specifically designed to track the financial progress of projects, which can then be used by managers to aid project management modules.

Software applications in this market typically include the following features:

• Industry-standard robust databases (eg PostgreSQL PostgreSQL is an object-relational database management system . It is released under a BSD-style license and is thus free and open source software. As with many other open source programs, PostgreSQL is not controlled by any single company, but has a global community of developers and companies to develop it, MySQL MySQL is a relational database management system which has more than 6 million installations. MySQL stands for "My Structured Query Language". The program runs as a server providing multi-user access to a number of databases. MySQL is officially pronounced /maɪˌɛskjuːˈɛl/ My S-Q-L, but often pronounced /maɪˌsiː'kwɛl/ My SEQuel, Microsoft SQL Microsoft SQL Server is a relational model database server produced by Microsoft. Its primary query languages are T-SQL and ANSI SQL, Oracle The Oracle Database is a relational database management system (RDBMS) produced and marketed by Oracle Corporation. As of 2009[update], Oracle remains a major presence in database computing, Pervasive)
• Industry-standard reporting tools (eg Cognos Cognos was an Ottawa, Ontario based company making business intelligence (BI) and performance management software. Founded in 1969, at its peak Cognos employed almost 3,500 people and served more than 23,000 customers in over 135 countries. Originally known as Quasar it adopted the Cognos name in 1982. On January 31, 2008, Cognos was officially, Crystal)
• Tools for configuring or extending the application (eg an SDK A software development kit is typically a set of development tools that allows a software engineer to create applications for a certain software package, software framework, hardware platform, computer system, video game console, operating system, or similar platform, access to program code, the ability to be controlled via Visual Basic for Applications Visual Basic for Applications is an implementation of Microsoft's event-driven programming language Visual Basic 6, and associated integrated development environment (IDE), which is built into most Microsoft Office applications. By embedding the VBA IDE into their applications, developers can build custom solutions using Microsoft Visual Basic. It (VBA))

High End

The most complex and expensive business accounting software is frequently part of an extensive suite of software often known as Enterprise resource planning Enterprise Resource Planning is a term usually used in conjunction with ERP software or an ERP system which is intended to manage all the information and functions of a business or company from shared data stores or ERP software.

These applications typically have a very long implementation period, often greater than six months. In many cases, these applications are simply a set of functions which require significant integration, configuration and customisation to even begin to resemble an accounting system.

The advantage of a high-end solution is that these systems are designed to support individual company specific processes, as they are highly customisable and can be tailored to exact business requirements. This usually comes at a significant cost in terms of money and implementation time.

Vertical Market

Some business accounting software is designed for specific business types. It will include features that are specific to that industry.

The choice of whether to purchase an industry-specific application or a general-purpose application is often very difficult. Concerns over a custom-built application or one designed for a specific industry include:

• Smaller development team
• Increased risk of vendor business failing
• Reduced availability of support

This can be weighed up against:

• Less requirement for customisation
• Reduced implementation costs
• Reduced end-user training time and costs

Some important types of vertical accounting software are:

• Banking
• Construction
• Medical
• Nonprofit
• Point of Sale (Retail)
• Daycare accounting (a.k.a. Child care management software)

Hybrid Solutions

As technology improves, software vendors have been able to offer increasingly advanced software at lower prices. This software is suitable for companies at multiple stages of growth. Many of the features of Mid Market and High End software (including advanced customization and extremely scalable databases) are required even by small businesses as they open multiple locations or grow in size. Additionally, with more and more companies expanding overseas or allowing workers to home office, many smaller clients have a need to connect multiple locations. Their options are to employ software-as-a-service or another application that offers them similar accessibility from multiple locations over the internet.

Use by Non-Accountants

With the increasing dominance of having financial accounts prepared with Accounting Software, as well as some suppliers' claims that anyone can prepare their own books, accounting software can be considered at risk of not providing appropriate information as non-accountants prepare accounting information. As recording and interpretation is left to software and expert systems, the necessity to have a Systems Accountant overseeing the accountancy system becomes ever more important. The set up of the processes and the end result must be vigorously checked and maintained on a regular basis in order to develop and maintain the integrity of the data and the processes that manage these data.

History

Bob Frankston has noted that his VisiCalc VisiCalc was the first spreadsheet program available for personal computers. It is often considered the application that turned the microcomputer from a hobby for computer enthusiasts into a serious business tool. VisiCalc sold over 700,000 copies in six years wasn't an early accounting program and that software that "overly tuned for such function (Javelin Javelin Software Corporation was a company in Cambridge, Massachusetts which developed an innovative modeling and data analysis product, also called Javelin, and later Javelin Plus. Seen as the successor technology to spreadsheet software in reviews of the time, and rival to the then-dominant Lotus 1-2-3, Javelin won numerous industry awards,, Lotus Improv Lotus Improv was a spreadsheet program from Lotus Development that attempted to re-define the way a spreadsheet should work, etc.) completely failed."^[1]

See also

• Accounting Accountancy or accounting is the art of communicating financial information about a business entity to users such as shareholders and managers. The communication is generally in the form of financial statements that show in money terms the economic resources under the control of management, and List of accounting topics Accounting ethics - Accounting information system - Accounting methods - Accounting period - Accounting reform - Accounting scandals - Accounting software - Accounts payable - Accounts receivable - Accrual basis accounting - American Institute of Certified Public Accountants - Amortization - Annual report - Annuity - Asset - Assurance services -
• Construction Software
• Comparison of accounting software
• Double-entry bookkeeping system The origins of a primitive double-entry system may possibly be traced as far back as the Roman Empire, in ""ex Oratione Ciceronis pro Roscio Comaedo", and Naturalis Historiae Plinii, lib. 2, cap. 7 where the advised system was "That the one side of their booke was used for Debitor, the other for Creditor" .[citation needed]
• E-accounting E-accounting is the application of online and Internet technologies to the business accounting function. Similar to e-mail being an electronic version of traditional mail, e-accounting is "electronic enablement" of accounting and accounting processes which are more traditionally manual and paper-based
• Enterprise Resource Planning Enterprise Resource Planning is a term usually used in conjunction with ERP software or an ERP system which is intended to manage all the information and functions of a business or company from shared data stores
• ERP On Demand
• ‎Investment management Investment management is the professional management of various securities and assets (e.g., real estate), to meet specified investment goals for the benefit of the investors. Investors may be institutions (insurance companies, pension funds, corporations etc.) or private investors (both directly via investment contracts and more commonly via
• ‎Tax

References

1. ^ Bricklin, Daniel. "Was VisiCalc the "first" spreadsheet?". www.bricklin.com. http://www.bricklin.com/firstspreadsheetquestion.htm. Retrieved 2007-09-26.

Accounting software Open Source Non-web GnuCash · Grisbi · HomeBank · KMyMoney · OpenERP · Tryton · TurboCASH Web-based Adempiere · BlueErp · Compiere · Dolibarr · EdgeERP · ERP5 · FrontAccounting · IntarS · Openbravo · OpenERP · opentaps · PhreeBooks · WebERP Freeware Microsoft Office Accounting Express Retail AME Accounting Software · Banana Accounting · COA Solutions Ltd · CYMA Systems · EasyAs Accounting Software · FinanceToGo · FlexAccount · iBank · Integrated Office Accounting · Iris Software · Microsoft Dynamics AX · Microsoft Dynamics GP · Microsoft Dynamics NAV · Microsoft Dynamics SL · Microsoft Money · Microsoft Office Accounting Professional · Microsoft Small Business Financials · Moneydance · Peachtree Accounting · Quasar Accounting · QuickBooks · Quicken · SAP Business One · Ubikwiti File Formats OFC · OFX · QC · QFX · QIF · XBRL Category • Comparison

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