Accounting Information System (PDF)

Running Head: Accounting Statement analysis
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Project Report: Accounting statement analysis

Accounting Statement analysis 2
Contents
Introduction.......................................................................................................................3
Medical overview.............................................................................................................3
Accounting information system........................................................................................3
Accounting cycle..............................................................................................................4
Sample of final statement.................................................................................................5
Chart of accounts..............................................................................................................6
Conclusion........................................................................................................................7
References.........................................................................................................................8
Appendix...........................................................................................................................9
Final financial statement preview.................................................................................9
Chart of accounts........................................................................................................12

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Introduction:
Accounting information system is the storage, process and collection of accounting
and financial data. It is used by the internal management of the company to maintain the
accounting and financial reports of the company and the information about the tax authorities,
creditors, debtors and the investors of the company. It is a computer based way to track the
accounting activity of an organization in terms with IT resources (Boockholdt and Li, 2009).
Accounting system software is prepared according to the need of the customers. It combines
the GAAP and traditional accounting practices together to perform better study.
Medical overview:
According to the case, Fitzory health is a medical centre which is owned by Dr
Freeman. Three doctors would be there in the medical centre which would be open in Oct,
2018. According to the research data and estimation, 800 patients would be there in the
database of the company. The fee of the centre would differ. Dr Freeman wants to set an
accounting information system to manage all the information of the company.
Proposal of Accounting information system:
Accounting information system is prepared according got the demands of the
customers and the process of the customer. In the case, it has been found that the accounting
information system is mainly need by the owner to manage the information about the patients
and to manage the information about the daily patients and their bill amount. In this case, a
customize software would be prepared for Dr Freeman so that he could collect, summarize
and process all accounting and financial information related to their business (Bodnar and
Hopwood, 2001). The accounting information system for the Fitzory Health would include an
easy system to maintain the details about the customers, their issues, total time of their
footfall, bill summary, inventory of the medicine and equipment summary, salary to doctors
and the receptionist etc.
The total cost of this accounting software would be $ 10,000 as the entire package
would be customized and lot efforts would need to be done by the IT people. the software
would need some technical requirement such as if any old patient would come in the centre
than by typing his name in the system, entire details would pop up into the screen and the
system would automatically update the inventory of the centre and will send a notification
when the inventory would be at minimum level (Romney, Steinbart and Cushing, 2000). The

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accounting system would make the process of accounting easier for the company. The
taxation liabilities would also be calculated by the system itself.
However, Dr Freeman has to take the enough training to operate the system. The
implementation of the software would be done by the information technology people in the
system of the Dr Freeman. But to operate the system, a training program would need to be
attended by Dr. Freeman (Romney and Steinbart, 2014). This training program would include
the operating process of the system in which how to set the database, feed the new entry in
the data base, set the taxation percentage etc will be included. The training program would
not take longer time. For any kind of support, our consulting team and the It team would be
there. Though, the annual maintenance is also required for the system. The annual
maintenance charge of the system would be $ 500 and if the Fitzory health wants any update
in the software than they could also contact to our team.
Accounting cycle:
In this customized accounting information system, accounting cycle process has also
been managed. Accounting cycle is a process which ensures the accuracy and conformity of
an organization’s financial statement, the accounting system has helped the companies to
reduce the mathematical errors in the process of the company. The accounting cycle would be
highly automated in this accounting software. Most of the transactions of the company would
be entered through using the specific terms such as the billing information of the patients and
the different bill of the patients.
Accounting cycle of this accounting information system would begin with recording
the journal entries into the system of the company. The entries of Fitzory health has been
recorded firstly in the accounting system which includes the receipt of the patients, total bill
amount of the patients, inventory record of the firm, expenses of the centre and other
transactions (Hall, 2012). After posting the journal entries into the general ledger accounts,
the system would directly prepare an unadjusted trail balance to ensure that the double entry
system has been followed by the system and every debit amount has been credited by the
company simultaneously. After the adjustment of trial balance, adjusting entries are done by
the software to manage all the functions of the firm well.
After it, the financial statements are prepared by the software which includes all the
relevant information of the firm such as total revenue of the form, total expenses, the
operating and non operating expenses of the company, total net profit generated by the firm,