Accounting Information Systems Report: B Bakery Case Study Analysis

This report examines the importance of an automated accounting system for B Bakery, a bakery firm currently using a manual accounting system. It analyzes the company's business processes, including product production, distribution, and human resource management, highlighting the drawbacks of the current manual system. The report proposes business requirements such as an automated payroll system, cost analysis, and financial statement preparation. It then identifies system requirements, including easy online accounting and financial statement analysis, recommending software like MYOB. The report concludes that implementing MYOB would be suitable for B Bakery, leading to improved cost control, financial statement accuracy, increased sales, and better demand determination. The report emphasizes the need for B Bakery to transition to an automated system to stay competitive and streamline its operations. The report also provides a detailed analysis of the advantages and disadvantages of using an automated accounting system for B Bakery. The report provides a comprehensive overview of the accounting information system for B Bakery, analyzing the benefits and drawbacks of the current manual system and suggesting the implementation of an automated accounting system.

Running head: ACCOUNTING INFORMATION SYSTEMS
Accounting Information Systems
Name of the Student
Name of the University
Author’s Note

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Table of Contents
Executive Summary.........................................................................................................................2
Introduction......................................................................................................................................3
Question 1: Definition of Business Processes.................................................................................4
Answer to [a]...............................................................................................................................4
Question 2: Development of Business Requirements.....................................................................5
Answer to [b]...............................................................................................................................5
Answer to [c]...............................................................................................................................7
Question 3: Determination of System Requirements......................................................................8
Answer to [a]...............................................................................................................................8
Question 4: Selection of Software.................................................................................................10
Answer to [a].............................................................................................................................10
Answer to [b].............................................................................................................................10
Question 5: Selection of Vendor....................................................................................................11
Answer to [a].............................................................................................................................11
Answer to [c].............................................................................................................................14
Conclusion.....................................................................................................................................15

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Executive Summary
The main aim of this report is to analyze the importance of automated accounting system for the
companies. For this reason, a research on accounting information system is done based on the
provide case study of B Bakery. At present, B Bakery uses manual accounting system. For this
reason, the advantages of automated accounting system are described in the report. Various
accosting software is taken into consideration for the report like MYOB. XREO, DecEasy and
others. Lastly, based on the outcome of the whole report, it is found that the implementation of
MYOB will be suitable for the business operations of B Bakery.

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Introduction
Accounting Information System plays a crucial role in tracking the financial activities
and information of the companies in an effective and systematic way (Romney and Steinbart
2012). It can be seen that extreme competition is one of the prime characteristics of the modern
business environment. In order to cope up with this competitive business environment, it is
essential for the business organizations for the adoption of various advanced technologies in
order to get the necessary competitive advantage (Soudani 2012). The main motive of this report
is to analyze and evaluate the importance and needs for an efficient accounting information
system for B Bakery. From the provided case study, it can be seen that the B Bakery has not
adopted the automated accounting information system as the firm is still using manual for of
accounting systems. In various part of this report, the importance and usefulness of various
accounting information are discussed in respect to B Bakery. In addition, various suggestions are
also provided to the company for the adoption of effective accounting information system.
Question 1: Definition of Business Processes
Answer to [a]
From the provided information, it can be seen that the main business process of B
Bakery is to produce and supply breads and various confectionary products to different
businesses, supermarket and pub-chains. Thus, it can be seen that B Bakery is mainly a bakery
firm. The owner of a bakery company is known as baker. In more specific words, baker refers to
the person who produces various types of breads and cakes with the help of heated sources and
supplies them to various businesses. On the other hand, bakers refers to the particular place
where a baker produces and sells his/her produces breads and cakes. There is not any exception

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of this fact in case of B Bakery as the firm has to carry different business processes and
activities. The follow section provides the description of various business activities of B Bakery:
Bakery Products Production: From the provided information, it can be seen that the main
business operation of this company is dealing with the production of various types of bakery
products. There is a Unique Selling Proposition (USP) can be seen for the company. As per the
provided case study, it is prominent that the firm put large emphasis on the health related factors
in their bakery products. For this reason, B Bakery produces healthy bakery products for their
customers. This can be considered as the USP of the company.
To Conduct the Business in Manual Basis: As per the case study, it can be seen that B Bakery
has been carrying out their business activities on the manual basis. From this, it can be
understood that B Bakery uses to record all the financial and non-financial transaction of the
company on the manual basis rather than using an advances technical accounting system. This
can be done with the help of various technologically advanced accounting software. The
continuation of manual accounting system can be identified as one of the major drawbacks of B
Bakery as the company has failed to adopt any ERP system.
Distribution of Product: According to the provided information, it can be seen that distribution
of produced bakery products is another major business operation of B Bakery. From this, it can
be understood that there is a separate business unit of B Bakery in the organization for managing
the process of product distribution. In this regard, it can be observed that B Bakery has made
collaboration with different types of distribution channels in order to sell their products. Some of
the major adopted distribution channel is supermarket chains, pub-chains and others.

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Ineffective Management of Human Resource: From the provided case study, it can be seen that
the employee base of B Bakery is 70. B Bakery uses to manage the salary process of their
employees in manual basis. From this, it can be observed that there is a lack of effective
computerized system for the processing of salaries for the employee in B Bakery. This manual
process affects the accounts department of the company along with the employees. Thus, from
the above discussion, it can be understood that lack of effective accounting information system is
affection various aspects of the business activities of B Bakery.
Question 2: Development of Business Requirements
Answer to [b]
The provided case study depicts the success of B Bakery in making good amount of
turnover. However, one cannot ignore the fact that the business operation of B Bakery is going to
be affected in the near future due to the adoption of accounting processes on the manual basis
(Laudon and Laudon 2016). The following discussion suggests some business activities for
making the business operations of B Bakery smooth.
Pay-roll System with Automated Accounting Software: In present, it can be seen that B Bakery
has adopted manual system for the processing and payment of salaries for their employees. As B
Bakery is considered as one of the major growing firms, it is of utmost important for them to
implement an effective structure for employee pay roll that will be automated. This will help the
company in crediting the salaries of their employees (Hall 2012).
Analysis of Cost Difference of Outflow and Inflow Activities: As per the earlier discussion, B
Bakery is a growing organization and thus, it is crucial for them to make classification of
different kinds of cost in the manufacturing and production process of the company. Apart from

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this, it is essential for the business organization to reduce the level of costs in different segments
so that secure future of the business can be sustained. Al these can only be possible with the help
technologically advanced accounting software (Knežević, Stanković and Tepavac 2012).
Determination of Cost of Production: It is essential for B Bakery to implement such business
process that will assists the company in the determination of cost of production or cost of goods
sold. With the help of the proposed process, the firm will be able to determine the costs of raw
materials along with the cost of finished goods. This is not possible in B Bakery in the presence
of manual accounting system (Dandago and Rufai 2014).
Preparation of Financial Statement and Annual Reports: It is required for every company to
publish their financial statements along with annual reports in regular basis. It is one of the major
indispensible parts of B Bakery in order to analyze the business processes of the company. Thus,
it is required for B Bakery to implement a particular business process I order to gain competitive
advantage (Simkin, Norman and Rose 2014).
Determination of Adequate Payment of Taxes: At the time of adopting the suitable accounting
methods, B Bakery needs to determine the market value of that system. In addition, it is required
for B Bakery to pay its various liabilities like tax and others (Jawabreh and Alrabei 2012).
Answer to [c]
In case, B Bakery becomes able to adopt the above business process suggestions, the
company will be able to attain certain benefits and outcomes. They are as follows:
Control over Variables and Different Operating Costs: In case B Bakery becomes able to adopt
the suggested business operations, the company will be effectively able to control the operating
costs. After that, B Bakery will become able to determine the lowest and highest unit of

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production that will provide the company control over its variable costs. With the help of this, B
Bakery will be able to adopt cost effective manufacturing system. In addition, this process will
assist the company in the minimization of unit of production that causes the company higher
operating cost (Demski 2013).
Effectiveness in the Preparation of Financial Statements: With the assistance of automated
accounting system, B Bakery will be able to prepare error-free and effective financial statements.
This process will make the company able to compare the financial results for more than one year
so that effective business planning can be done (Daoud and Triki 2013).
Sales Increase: This suggested process will make the company know about the cost of
production and its cost per unit. With the help of this, B Bakery will be able to develop their
short-run and long run price strategy. This adopted pricing strategy will increase the sales
revenue of B Bakery so that profit of the company can be increased (Tazik and Mohamed 2014).
Determination of Demand: It is required for the companied to evaluate the demand and supply
of their products. Implementation of automated business process will assist B Bakery to
determine the demand and supply of bakery products. For this, efficiency can be brought in the
production process along with the minimization of unused inventories. From the above
discussion, it can be said that B Bakery will be able to attain these above-discussed outcomes
with the help of automated accounting system (Caglio and Ditillo 2012).

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Question 3: Determination of System Requirements
Answer to [a]
Different kinds of requirement for accounting systems can be seen in the bakery firms.
Two major requirements are effective analysis and evaluation of various financial statements and
documentation process of various business records related to debtors, creditors, vendors and
others.
Easy Online Accounting: In the recent era, most of the business organizations are implementing
the process of online accounting transactions. Thus, it is essential for B Bakery to implement
such a system by which the company can get payments from the debtors and can pay the
creditors. In addition, it is required for the management of B Bakery to know every important
aspects of the company in order to take prompt business decisions. In addition, there is a need to
bring efficiency in the inventory management of the company. All these aspects will ensure the
firm’s growth. Most importantly, it is needed for B Bakery to secure the internal control system
of business in order to avoid the leakage of important and confidential business information
(Awerbuch and Preston 2012).
Analysis of Financial Statements: Different types of automated accounting systems are required
for B Bakery for the recording and reporting of financial transactions. In this regard, the
suggested accounting software for B Bakery are DacEasy, MYOB and others. As B Bakery does
not have any automated accounting software in present, the use of these systems will ensure the
future success of the company. In addition, in order to keep the track of all financial transactions
on the daily basis, these accounting systems play a crucial role. Most importantly, business
organizations need to implement such accounting system that is secure from external threats. It

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needs to be done as the internal system of the companies can only access these accounting
systems (Melnyk et al. 2014).
Documentation of Different Records: It is prominent that all the large scale as well as small
scale business organizations need to be involved in different types of financial as well as non-
financial transactions. Accounting transactions are the part of these transactions and all these
transactions have equal importance for the business activities. For this reason, it is essential for B
Bakery to implement efficient accounting software in order to record the financial and
accounting transactions on the daily basis. In addition, there is a need for accounting transactions
over the years in order to measure the financial performance of the company. Most importantly,
B Bakery needs to make a comparison of the accounting and financial transactions with its
competitors. For all these reason, it is required for B Bakery to record all the transactions related
to debtors, creditors, distributors, vendors and others. Thus, it is required to install automated
accounting system in order to keep all these records (Stair and Reynolds 2013).
Different Types of Cost Analysis: It is needed for B Bakery to implement effective automated
accounting software so that different kinds of costs can be analyzed on a daily basis. For this
purpose, the preparation of effective cost-sheet reports is required for the company. B Bakery
can present all these reports to their vendors as they include all the information. Apart from this,
these cost-sheets also include all the details and transactions related to the salary of the
employees with the help of electronic transactions (Ram, Corkindale and Wu 2013).
As per the above discussion, these requirements B Bakery needs to be mentioned at the
time of the implementation of selection of accounting software. Thus, B Bakery needs to

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implement all these requirements in order to achieve the short term as well as long-term goals of
the company.
Question 4: Selection of Software
Answer to [a]
As per the business requirements of B Bakery, the following accounting software will be
suitable for their business operations. B Bakery can select any of them based on their business
requirements.
 DacEasy
 MYOB
 SAP
Answer to [b]
Low End Accounting Software: Low end accounting software is suitable for the types of
companies that have simple as well as less numbers of business transactions. The use of this kind
of software can be seen among different professionals like doctors, lawyers and others. Very few
companies use this software as cannot recode large number of complex transactions (Zairi 2012).
Medium End Accounting Software: Companies use this software for meeting the basis financial
as well as accounting transactions requirements. This accounting software covers all the primary
financial and accounting transactions of the companies. In addition, small and medium size
business organizations use this software for the preparation of various financial reports and it
supports the double entry accounting system. Thus, many small and medium size companies use
this software.

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High End Accounting Software: Companies use high end accounting software for the recording
of large number of complex accounting transactions. For this reason, the big and multinational
companies use this type of accounting software. This kind of accounting software can record
large accounting transactions they are made with advanced technology. All these unique features
of this accounting software make it more expensive in implementation for the companies and
thus, small and medium size companies cannot afford the implementation of this software (Zairi
2012).
Based on the above discussion, it can be said that medium end and high accounting
software will be suitable for the business operations of B Bakery. From the provide case study, it
can be seen that B Bakery has the financial capacity for the implementation of both medium end
and high end accounting software.
Question 5: Selection of Vendor
Answer to [a]
B Bakery has the option to adopt various accounting software and they are DacEasy,
Xero, MYOB and others. Thus, it is essential for the firm to make a comparison between this
software before the implementation decision. The comparison can be conducted based on some
specific aspects like capacity of transactions recording and documentation, payroll structure,
exposes, risk, sustainability, time scheduling and others. Thus, the bases of comparison are as
follows: