Accounting Software

Application
(With Peachtree
Software)
 INTRODUCTION

Manual and computer based data

Processing system
In processing accounting data we can
use either manual based or
computer based data processing
system.
Manual approach and a computerized
method follow the same basic steps.
 INTRODUCTION

 The primary difference b/n manual and

computerized accounting are the method of
recording data and generating reports.
 In both method of accounting, source documents
from daily transactions are collected and
analyzed in the same way.
 In a manual system, the data is recorded by
using paper, pen and pencil etc.
 In computerized system, the data is recorded in
the computer. The computer then is able to
classify and summarize the data. It can post
transactions to the general ledger.
INTRODUCTION
 1.1.1 Manual based data processing system

In this system, extensively,

bookkeepers are engaged in
identifying, measuring, recording
summarizing, reporting and
interpreting financial data to help
decision makers.
In manual data processing system, it
takes more than two or three months
for the preparation of financial reports
after the end of the accounting year.
 Computer based data processing system

 Except decision making position, computer

play a great role in the accounting
information system.
 The developments of accounting soft ware
application alleviate the problem of producing
financial reports on demand- because data
are processed with the maximum accurate
speed to produce the required financial
reports.
 With the absence of errors and computer
fraud, it produces timely; relevant, reliable
and prompt reports for decision makers on
time.
 Components of Computerized Accounting System

Components of Computerized Accounting

can be classified into six categories,
namely:
i) Hardware
ii) Software
iii) People
iv) Procedure
v) Data and
 Components of Computerised Accounting System

i) Hardware
 The physical components of a computer
constitute its hardware. Hardware consists of
input devices and output devices that make a
complete computer system.
 Examples of input devices are keyboard, optical
scanner, mouse, joystick, touch screen are used to
feed data into the computer.
 Output devices such as monitor and printer are
media to get the output from the computer.
 Components of Computerised Accounting System

ii) Software
A set of programs that form an interface between
the hardware and the user of a computer
system are referred to as software. The
following are the various types of software:
a) System software: A set of programs to control
the internal operations such as reading data
from input devices, giving results to output
devices and ensuring proper functioning of
components is called system software.
 Components of Computerised Accounting System

The system software includes the following:

(1) Operating system: A set of tools and
programs to manage the overall working of a
computer using a defined set of hardware
components is called an operating system. It
is the interface between the user and the
computer system. Example: DOS, Windows.
 Components of Computerised Accounting System

(2) Programming software: Special software

to accept data and interpret them in the form
of machine/assembly language
understandable by a computer. Example: C,
PASCAL, COBOL, etc
(3) Utility software: These are designed
specifically for managing the computer device
and its resources. Example: File manager,
Anti-virus software, etc.
 Components of Computerised Accounting System

b) Application software: Programs designed to

perform a specific function for a user. An
application software can be classified as
follows:
(i) General purpose software: This type of
application can be used for a variety of tasks
and not limited to one particular function.
Example: MS-Office.
(ii) Specific purpose software: This software is
created to execute one specific task and they
are customised to the needs of user. Example:
Accounting software, payroll software.
 Components of Computerised Accounting System

iii) People
The most important element of a computer system is
its users. They are also called live-ware of the
computer system. The following types of people
interact with a computer system.
a) System analysts: People who design the operation
and processing of the system.
b) b) System programmers: People who write codes
and programs to implement the working of the
system.
c) c) System operators: People who operate the system

and use it for different purposes

 Components of Computerised Accounting System

iv) Procedure
Procedure is a step by step series of instructions to
perform a specific function and achieve desired
output. In a computer system there are three types of
procedures.
a) Hardware oriented procedure: It defines the working
of a hardware component.
b) b) Software oriented procedure: It is a set of detailed
instructions for using the software.
c) c) Internal procedure: It maintains the overall
working of each part of a computer system by
directing the flow of information.
 Components of Computerised Accounting System

v) Data
The facts and figures that are fed into a computer
for further processing are called data.
Data are raw input until the computer system
interprets them using machine language,
stores them in memory, classifies them for
processing and produces results in
conformance with the
instructions given to it.
Processed and useful data are called information
which is used for decision making.
 Advantages of Computerised Accounting

1. Better Quality Work: The accounts prepared with the

use of computerized accounting system are usually
uniform, neat, accurate, and more legible than a manual
job
2. Lower Operating Costs: Computer is a reliable and
time-saving device. The volume of job handled with the
help of computerized system results in economy and
lower operating costs. The overall operating cost of this
system is low in comparison to the traditional system
3. Relieve Monotony: Computerized accounting reduces
the monotony of doing repetitive accounting jobs.
Which are tiresome and time consuming
 Advantages of Computerized Accounting

4. Minimizes Mathematical Errors: While

doing mathematical work with computers,
errors are virtually eliminated unless the data
is entered improperly in the system
5. speed : Accounting data is processed faster

by using a computerized accounting system

than it is achieved through manual efforts.
This is because computers require far less
time than human beings in performing a task
 Disadvantages of Computerized Accounting:

1. Reduction of Manpower: The introduction of

computers in accounting work reduces the number
of employees in an organization. Thus, it leads to
greater amount of unemployment.
2. High Cost: A small firm cannot install a computer
accounting system because of its high installation
and maintenance cost. To be more economical there
should be large volume of work. If the system is
not used to its full capacity, then it would be highly
uneconomical.
3. Require Special Skills: Computer system calls for
highly specialized operators. The availability of such
skilled personnel is very scarce and very costly.
 Disadvantages of Computerized Accounting:

4. Other Problems: Frequent repair and power failure

may affect the accounting work very much.
Computers are prone to viruses. Often time’s people
will assume the computer is doing things correctly
and problems will go unchecked for long period of
time.
5. Cost of Training: The sophisticated computerised
accounting packages generally require specialised
staff personnel. As a result, a huge training costs are
incurred to understand the use of hardware and
software on a continuous basis will be required.
 Disadvantages of Computerized Accounting:

6. System Failure : The danger of the system crashing

due to hardware failures and the subsequent loss of
work is a serious limitation of computerized
accounting system.
However, providing for back-up arrangements can
obviate this limitation. Software damage and failure
may occur due to attacks by viruses. This is of
particular relevance to accounting systems that
extensively use Internet facility for their online
operations.
No full-proof solutions are available as of now to
tackle the menace of attacks on software by viruses.
COMPUTERIZED ACCOUNTING Vs MANUAL ACCOUNTING
COMPUTERIZED ACCOUNTING Vs MANUAL ACCOUNTING
 Accounting Software :

Accounting Software is a computer software that

records and process accounting transactions
with functional modules such as accounts
payable, accounts receivable, payroll and trial
balance.
There are different types of accounting software,
such as: 1. Peachtree software 2. Tally.ERP, 3.
QuickBooks.
Among these common type of accounting
software Peachtree has fully integrated
accounting system.
 1.1.4 What is Peachtree accounting?

Peachtree accounting is the most

complete, powerful and fully integrated
accounting system.
It can serve for multi types of organization
in order to handle their transaction.
It can also employ an accounting system
from data entry to reports of the
organizations.
The importance of Peachtree software can
analyze financial data and can provide
time management.
 1.1.7 Peachtree accounting menus

File: the file menu is used to setup and open

companies within Peachtree accounting. It is
also used backing up and restoring data.
Edit: use the edit menu to work with
information in records, transactions, reports
or forms.
Maintain: use the maintain menu to set up
and change information about customers,
vendors,
employees, inventory items, jobs, company
information, default information, memorized
transactions, sales taxes, and
users/passwords.
 1.1.7 Peachtree accounting menus

Tasks: use the tasks menu to pay vendors,

receive payments from customers, pay
employees,
and make adjustments to your general journal.
You can use this menu to record time and
expense
tickets, adjust inventory, make assemblies,
reconcile your bank account, and void checks.
You
can also change the accounting period and close
the fiscal year.
Analysis: use the analysis menu to examine
different aspects of your business using the
Peachtree accounting managers.
 1.1.7 Peachtree accounting menus

Options: use the options menu to set up how

you want smart data entry to work, how you
want decimal points inserted in numbers, and
how you want the lookup lists displayed in
task windows. You can also choose to display
the navigation aids or status bar.
Reports: use the reports menu to print reports,
forms, and financial statements as well as
designing them. You can also report groups
and customize report styles.
Help: use the help menu for any questions you
may have on the program, technical support,
Peachtree product and services.
 Starting the Program

There are two ways to open Peachtree software:

1. Double click on Peachtree icon from the
desktop.
2. you can start Peachtree using Choose Start➪
All Programs ➪ Peachtree Premium Accounting
2010
 Choosing opening options

After you start Peachtree, what do you do with

it? The Peachtree Start Screen appears as
shown in Figure 1-1, beckoning you to do one
of several things.
You can select any of the following options or
click the Close button to close the window:
 Choosing
options opening

Open an existing company:

Use this option to open a
company already
existing in Peachtree.
Create a new company:
Select this option to set up
your business with the
Peachtree Setup Wizard.
 Opening a recently used
Peachtree company

If you find yourself frequently switching back and forth

between several companies, Peachtree provides an
easier method; the Open Previous Company option.
This option lists up to ten previously opened Peachtree
company names from which you can select. Follow
these steps to open a previously open company:
1. Choose File➪Open Previous Company. A list of
previously open Peachtree company names appears.
2. 2. Click the company name that you want to
open. The annoying little message that we mention
in the previous section appears unless you turned it
off.
3. 3. Click OK to acknowledge the message. The
selected company opens on the screen.
 2.1 Maintain charts of accounts

A chart of accounts provides a basis for

recording transaction on the general journal
and to post
them on the Léger.
The general Léger is the backbone of any
accounting system.
All of the transaction you process in your
business eventually get posted or stored in
the rest of accounts known as your general
Léger.
This set of accounts is called the chart of
accounts.
 2.1 Maintain charts of accounts

An example for accounts in the chart of

accounts
 Account receivable (trade debtors)
 Account payable (trade creditor)
 Accumulated depreciation( fixed asset
contra account)
 Cash(all types of cash)
 Cost of sales
 Equity

 Expenses

 Long term liability

 Entering your chart of accounts

From the maintain menu, select chart of

accounts
1. Select account ID
Enter: account ID-----1000
2. Enter account description----- cash at
bank
Select account type
3. When you have finished filling in the
window, select the save icon.
 2.1.1. Entering beginning balances for chart of
accounts

It is easier to add all

necessary accounts and
then create one cumulative
beginning balance entry
Steps to enter beginning
balances:
 2.1.1. Entering beginning balances for chart of
accounts

From the maintain menu,

1. Select chart of accounts. Peachtree displays the
maintain
chart of account window.
2. Select the Beginning Balance button. Peachtree
displays the select period window.
3. Select the accounting period in which you want to
enter beginning balance and click Ok (e.g. From
12/1/16 Through 12/31/16)
4. Click or Tab to any of the white cells in the grid to
change or add an amount. Enter all the beginning
balances for the accounts. Scroll the list box to make
sure the account amounts are correct. If necessary,
you can enter a negative amount; just type a minus
sign before the number.
5. Select OK when you are finished.
 1.1.10 How to back up (save/save as) a company

❖ The followings are the steps to take back up;

1. From the Peachtree file menu, select back
up
2. 2. Select the box of
✓ remind me when I have not back up in 7
days and
✓ the box of include company name in the
back up file name
3. Click on the save in folder
4. Select the device (external or internal)
5. Save
6. Ok
 1.1.12 How to delete a company

The followings are the steps to delete company

1. Open the company which you want to delete
2. 2. Go to maintain menu, select company
information write your company file directory.
C:/program files/sage
software/Peachtree/company/
3. 3. Ok
4. Close Peachtree accounting

5. Go to my computer
6. Double click each folder till you get your
company folder name, once you get it right
click on it and delete or shift plus delete .
 How to
companyrestore a

✓Restore:- means opening back up files

The followings are the steps to restore company;
1. From the opened Peachtree file menu select
restore
2. Click on browse
3. Click on look in
4. Select the device (external or internal)
5. Select back up files
6. Open
7. Next
8. Select new company
9. Next
10. Next
11. Finish
The end of the chapter
Thank You