Topic 18 - Use of technology in accounting

Question 1

What do spreadsheets allow us to do?

Answer 1

• Used to provide financial budgets or cash flow budgets and non-current asset registers
• Used to calculate loan interest payments and many other sums
• Sped up accounting process as they allow data to be presented in a number of different ways and can be easily adapted and changed

Question 2

What does accounting software allow us to do?

Answer 2

• Allows financial statements to be produced quicker than traditional hand-written methods
• Data needs to be entered once
• Can be used to complete all aspects of a transaction

Question 3

What are the advantages of accounting software/spreadsheets?

Answer 3

• Speed
• Accuracy
• Capacity
• Efficiency
• Data handling
• Security
• Increased job satisfaction
• Document preparation
• Updated data

Question 4

What are the disadvantages of accounting software/spreadsheets?

Answer 4

• Cost
• Technical problems
• Industrial relations
• Security
• Operator error
• Health risks

Question 5

How can we ensure the security of data?

Answer 5

Data loss: Data must be saved regularly and protected against data loss. Data must be stored, protected, and backed up.

Access: Staff are allocated passwords that restrict access to their area of work and must be regularly changed as well as having anti-virus and anti-malware systems.

Confidentiality: Financial information is sensitive and confidential so preventing unauthorised access is vital.

Question 6

What methods should be enforced to protect accounting hardware and software?

Answer 6

• Installing a firewall
• Installing an antivirus software
• Installing anti-malware software
• Using complex and secure passwords
• Checking security settings on internet browsers