Kogan.com: Analysis of Accounting System and Software Selection

This report provides a comprehensive analysis of the accounting system for Kogan.com, an e-commerce business. It begins with an introduction to accounting information systems (AIS) and their significance in business operations. The main body of the report details Kogan.com's background, business requirements, and system requirements. It examines the key business processes, including inputs, interrelated activities, and desired outputs. The report assesses the software features needed to achieve IT investment objectives, focusing on aspects like data security and reporting capabilities. The report then explores the selection of accounting software, including an overview of different software categories, with a focus on XERO. The report concludes with recommendations for Kogan.com's accounting system, emphasizing the importance of effective information for decision-making.

ANALYSIS OF ACCOUNTING SYSTEM
FOR KOGAN.com

TABLE OF CONTENTS
Introduction................................................................................................................................5
Main Body..................................................................................................................................5
(a) Background.......................................................................................................................5
(b) Business Requirement......................................................................................................6
(c) System Requirement.........................................................................................................7
(d) Software Selection............................................................................................................9
(e) Vendor Selection............................................................................................................12
Conclusion................................................................................................................................14
Recommendation......................................................................................................................14
References................................................................................................................................16

TABLE OF FIGURES
Figure 1 Business Process of E-business...................................................................................6
Figure 2: Phases of E-business in which system plays significant role.....................................9
Figure 3: Accounting Information System of E-Business.......................................................10

EXECUTIVE SUMMARY
Accounting information systems and innovation are employed in the business with the
objective of enhancing the effectiveness of their operations and to attain success with ease. A
huge amount of money is used by the organizations for their tools applied for improvement
majorly for improving the operations of the business. The present study emphasizes on
assessment of need of Accounting Information System in Kogan .com so that its objective
could be attained with ease. Detail explanations relating to the manner in which AIS will
assist the company in attaining its objectives have been provided. The report ends up with an
explanation of the manner in which XERO assist in attaining appropriate effective
information and in an effective decision making.

Introduction
Information system and technology are considered as a significant source of the organization
as it plays a noteworthy role in every department or operation of the company. Further
accounting information refers to a structure which is used by a company to assemble, store,
process, supervise, regain back and preparation of its financial reports (Truong, 2016). The
information directly affects financial statements which are utilized by consultants,
accountants, executives and other regulations as well as tax organizations. In addition to this,
companies hire skilled accountants so that they work according to the AIS and same leads to
enhancement of accurateness and the effectiveness of the system. Present report revolves
around discussion relating to the significance of Accounting Information System for
Kogan .Com. Apart from this, the functionalities which are important for the company are
considered and also discussed in order to analyze the business process of the restaurant.
Eventually, the most suitable accounting software has been suggested which satisfies the
needs of the restaurant.
Main Body
(a) Background
Konga.com is a group of retail and services business comprising Kogan Retail, Kogan
Market, Kogan Mobile, Kogan Internet, Kogan Insurance along with Kogan Travel
(Overview of Kogan, 2017). Further, the Kogan brand is popular for price leadership through
digital competence. Kogan concentrates on making goods and services which are in-demand
more reasonable and available. It is situated in Melbourne, Australia.
Moreover, Kogan retail provides products from leading brands across a broad variety
comprising customer electronics, appliances, homewares, hardware, playthings and so on. It
owns and functions a collection of limited private label brands. In addition to this, Kogan
Mobile which is a part of Kogan.com offers the services of mobile offerings. Kogan Internet,
it is another part of Kogan.com which provides value-based NBN™ internet strategies. Apart
from this, Kogan Insurance provides simple and reasonable house, contents, car as well as
travel indemnity. Kogan Travel offers services of incredible travel that deal with the very
famous destination.

(b) Business Requirement
Key Business Process
With accordance to Chang (2016), the business process is a collection of the linked task that
once completed will attain the objective of the company. Moreover, it can be stated as a set of
interconnected or interacting actions through which inputs can be converted into outputs
(Hammer, 2015). This utilizes resources such as individuals and stuff. In order to have an
effectual administration of restaurant, it is essential to have the appropriate approach to the
business process.
Figure 1 Business Process of E-business
(Source: Uyar, Gungormus and Kuzey, 2017)
Significant variants of the business process of Kogan.com
Inputs: These can be referred to as the core for attaining efficiency in the operations of an e-
business. Since if there are no inputs operations cannot be carried out. These comprise the
initial requirement of an e-business such as people, software, process, equipment as well as
surroundings. Efficient technology and the appropriate staff are available at Kogan .com. As
due to the availability of appropriate resources company is expecting to move further to
enlarge its operations. It is stated by Nanda, (2016), that, in order to increase the efficiency of
business it is very important that the employees satisfied with the decisions of management.
The main emphasis should be made on required staff along with software and technology and
equipment to run the online business in a smooth manner.
Interrelated activities: There are some activities which are interrelated with each other. Some
of them are business processing of organization, procuring, storing, marketing, accounts etc.

Accounting activity relates to invoices relating to online sales of product concerning the
products and services which are vented to them. Subsequently, the order of sales is taken by
investigating future markets. This includes assessing the trend of product so that stock could
be maintained in the same accordance. Secondly, the HR manager will undertake the issues
relating to management in the organization. Thirdly, the marketing and sales department
which relates to the promotion of services offered through business. This will include the
ascertainment of the platform on which the services of the organization require to be
promoted. Apart from this, they also have to decide appropriate process approach after
assessing that it will be useful for the business or not.
Outcomes required from these process in order to achieve business objectives
Output refers to the results which are desired. They are the result of inputs which are
employed in order to obtain the desired outcome. Further, outputs are the goods and services
which are provided to consumers. Thus, Kogan.com is expected to provide all the products
required by the customer in order to accomplish their needs. The company is expected to
focus on the quality of the product, and it should be according to the specification provided
on the product so that customer could have trust in the company. Further, the latest trend is
expected to be part of an organization so that the service provided by the company could also
be as per them. As per assertions of Soni, Saluja, and Vardia (2018), trust in the responding
ability of the service and addressing issues is imperative, for complementing the new
business innovation culture and cloud computing the manager’s needs to conduct skills
adjustments. Thus, in order to achieve objectives, it is necessary that company required to
provide effective training so that the needs of customers can be assessed in an appropriate
manner.
(c) System Requirement
Software features or functionalities required to be achieved for IT investment objective
The main operation of Kogan.com is to provide products and services to its customers
through an online portal. Thus, it is necessary to provide information to the customer in an
appropriate and interactive manner so that they could be encouraged to purchase the products
or services. The technology available to the system should indulge the latest trend in itself so
that the company is able to provide the same through its services. E-business comprises new
risk which is required to be addressed by the program of the system applied in the
organization in order to mitigate the risk. The fundamental changes in the system will lead to

change the manner of execution of operations in business. As the company provides products
as well as services online, thus IT risk is the most significant variant to be assessed in the
system requirement. The system requires to the adequate main backup procedure so that in
case of loss of data company is able to recover its books of accounts. The other feature on
which the main emphasis is required is Bugs and error in IT application. The integrated
collection of tactics of accounting information system supports in effective decision making
as well as for providing feedback relating to daily operations. It can be referred to as a
necessary requirement of a system. The elements which are applied to evaluate a system are
timeliness, accuracy, consistency, completeness and relevance. The system should be able to
generate effective reports so that the data which has been extracted in reports could be
applied for effective decision making. Accounting information system comprises details of
economic events of an organization and then processes them in accordance with the demand
of different organization. Further, the same is provided to the specific department who are
responsible for taking a decision.
A system is having a close connection with the management information system, the
accounting department as well as the administration system. The reason behind the same is
that the system is responsible for acquiring, coding, recording as well as processing the data
in order to provide the same to the responsible system. It is believed that the human factor
plays a vital role in order to implement a system in an appropriate manner (Ha, Manh and
Van Anh, 2017). As the specified human factor is the one, who interprets the reports provided
by the system as well as takes decision in accordance with it. Even the reports which are
provided by the system are developed in accordance with the instruction provided by a
human. The software of a system is chosen in accordance with the nature of activities of
business as well as a business process applied in a system. In the present case of Kagon.com
which is an E-business, the variants which are required to be an assessed selection of
software are understandability, accessibility, security from mal-functioning, security from
virus and other internet issues etc. The basic accounting system of an organization is
supported by software modules of the system which can be connected as well as capable of
cooperating in an efficient manner.
An e-business usually has a complex system, and in that case, it is necessary for the software
to support the fundamental activities, the various procedures in detail although in an
incorporated manner. In order to understand this, it is important to have a universal database
replicating the entire operations of the organization, modified information and trustworthy

data. It is stated by Lochrie et al. (2016), that, the main objective of complex information is to
prop up the planning and strategic decisions of the administration under which management
information system plays an important role. Moreover, the system also supports the inner
system of the company as well as its process. At the commencement of creation of the system
fulfilling the demands for accounting, financial rules and administration’s anticipations were
crucial. But later this incorporated leads to boosting up the efficiency, making the best of
capacity, optimizing the supply processes, lowering the expenditures as well as the capability
of planning. As at that time, the business and logistic areas were the main areas of interest. In
the present time, the main factors are mitigating risks, building and keeping steadiness as well
as acquiring reliable data for the decision of the administration can be specified as a
necessary requirement of the system. Thus, in order to survive in the market, Kogan has to be
up to date with the system software.
Figure 2: Phases of E-business in which system plays a significant role
(Source: Abdelaziz, 2016)
(d) Software Selection
Assessment of available accounting software

Figure 3: Accounting Information System of E-Business
(Simkin, Norman and Rose, 2014)
According to Simkin, Norman and Rose (2014), the accounting information system refer to a
system that utilizes economic data obtained from the interior and exterior transactions of the
business. Further, accounting information does not have one definition. It has been shown by
Hall in his study, accounting information system as a secondary-branch of administration
information systems. In addition to this, the main role of this system is to exercise financial as
well as non-financial transactions. In other words, the accounting information system can be
defined as a system of recording, categorizing, summarizing and exposure of economic
actions influencing businesses (Teittinen and Granlund, 2017). Therefore, executives must
authenticate the accurateness of information to make a decision in a more appropriate
manner. The three categories of accounting software have been specified below:
According to Chowdhury, Bari, Ahmed and Boutaba, (2014), low-end accounting software
enables the most fundamental accounting operations to be exercised at the low end of
business markets. It is usually created for small business and generally could be purchased as

off the shelf software from main retailers. Further, it is generally not specific to any particular
diligence or vertical market; it can be utilised across a wide spectrum of business types. If the
business is small and only requires something simple to create billing invoices, enter AP
invoices and cut checks this software might be appropriate for them.
With accordance to Nori, Kassim, Ahmad and Nasir, (2016), mid-market accounting software
enables accounting in multiple currencies in the mid-market encompassing a wide variety of
business which is able of satisfying the needs of multinational organizations. The mid-market
encloses a wide variety which might be able of serving up the requirements of multiple
national accountancy standards and enables accounting in various currencies. Further, the
software might comprises incorporated or add-on management information systems and
might be oriented to one or more markets, for instance with incorporated or add-on project
accounting sections. Moreover, software applications in this market usually comprise some
features which are given below:
 Industry-standard robust databases
 Industry-standard exposure instruments
 Instruments for configuring or expanding the application such as SDK access to
program code.
High-end accounting software has the feature related to execution for long-term usually more
than months. According to the Seethamraju, R., (2015), the most difficult and costly business
accounting software is often part of an extensive set of software frequently known as ERP
that is enterprise resource planning software. As per the study of Wolfe, Fitzgerald and
Newton (2017), these applications usually have a long period of execution, frequently more
than six months. There are many cases in which applications are merely the set of operations,
entails critical incorporation, configuration along with customization to even instigate to
resemble an accounting system. Nowadays there is numerous freeware high-end open-source
accounting software which is accessible at online sites, intends to modify the market
dynamics. Many of these software solutions are web-based.
Accounting Software Selection
High-end accounting software has been selected for Kogan .com. The benefit of the high-end
solution is, these systems are created to prop up individual company-specific procedure since
they are extremely customizable and can be modified to accurate business requirements