Manual Versus Computerized Accounting System


Accounting appears to be an imperative component of every business. In fact, any business is obliged to properly keep both the debit and credit balances in their respective books of accounts. This necessitates choosing the best business idea that either incorporates software, human beings or both. Since accounting is a business language that is generally accepted and commonly applicable to all businesses, the practice has been made much easier with technological advancements. The division of accounting into two categories namely computerized accounting system and manual accounting systems however gives options to firms and companies on the best alternative they should adopt. Both manual and computerized accounting systems have different features, benefits as well as shortcoming.

Manual accounting system (MAS) versus computerized accounting system (CAS)

According to Warren et al., (2011. p.220), accounting cycle entails various steps including but not limited to the preparation of trial balance, journal entries, ledger account postings, adjustment entries, and the preparation of financial statements alongside suitable disclosures. Given the nature of the undertaken activities and the quantity of transactions being processed, there are chances of human errors, high levels of inaccuracy and the possibility of loosing data. Yet, all transactions should be identified, categorized and finally documented prior to the identification and changing of the corresponding accounts (Considine, 2010. p. 253). Thus, most firms have been left in dilemma between opting for either the manual accounting or computerized accounting system. The decision about the best option requires firms to weigh between ensuing advantages and disadvantages of these accounting systems.

The benefits and shortcoming of accounting systems

MAS seem to have evolved over a period of time and the system is associated with a stronger human factor since clients have the presence of a human to whom they can raise their concerns. Furthermore, MAS allows for an easy review of every ledger accounts and simple changes can be made anytime in the clients’ accounts. Despite performing similar tasks like the computerized system, manual accounting system is relatively prone to accounting errors. For instance, this system involves keeping various paper ledgers so as to keep track and records appertaining to all the financial transactions. All financial information must have separate accounting ledgers which an accountant will have to consolidate into a single general ledger. This makes the manual accounting system to be more time consuming as compared to the computerized accounting system (Gelinas et al., 2011. p. 71)

Stair and Reynolds (2009. p. 432) argue that the modern accounting systems are inclined to damages such as virus attack, hardware malfunctions and the stored data could easily be tampered with as compared to the written financial paper records. Moreover, a firm has to employ a specialist to manage the computerized accounting system. Regardless of such claims, computerized accounting systems have evolved and gained more storage and processing power besides enabling the production of information within the shortest time possible. Since the computerized accounting systems have integrated accounting software, any computation is easily done while the financial information is easily accessed because the records are rather organized.

Trending analysis as well as financial transaction report variances from any division within the firm can be created and easily accessed using the computerized accounting system. Therefore, when compared to the manual accounting system, errors are less common with the computerized accounting system whereas benefits ensue in form of accurate calculations, more time saving and hence, very efficient.


Due to immense market competition, businesses yearn to be at pace with modern technological advancements. Adopting a CAS such as Mind Your Own Business could help the firm to maintain its market dominance. In fact, provided the software is properly set up and is being operated by a specialist, it will save the firm a great deal of time taken to record transactions and effort used in search or to keep the financial information. The only problem encountered is the implementations costs associated with the MYOB. After implementing this accounting software, the project has to be managed to ensure that all tasks are overseen and generate successful results. However, the firm will have to define clearly all the needs and outcomes during the pre-implementation so that data could be converted according to the client’s stipulation to ensure security, workflow and maximum benefits. Finally, effective requires that some personnel must be trained to be acquainted with accounting system in place.


While both MAS and CAS have merits and demerits, MAS poses severe setbacks to any firm and such shortcomings tend to outweigh the accruing benefits. Nevertheless, as the proprietor aspires to keep track of every financial transaction, the CAS is deemed essential for the firm due to its reliability and efficiency. Several versions of this accounting system exist and more proficient software can readily be purchased and installed to help the firm effectively manage the size and complexity of its financial transaction. If the proprietor adopts MYOB, most financial transactions will be reliable, accurate, faster, mobile and deficient of routine work. The level of productivity will increase and records will be restored through back-ups.


Considine, B. 2010. Accounting Information Systems-Understanding Business Processes. Hoboken, New Jersey: John Wiley & Sons.

Gelinas, U. J., Dull, R. B., & Wheeler, P. 2011. Accounting Information Systems. Boston, MA: Cengage Learning.

Stair, R. & Reynolds, G. 2009. Principles of Information Systems. Boston, M.A: Cengage Learning.

Warren, C., S. Reeve, J., M. & Duchac, J. 2011. Accounting. Boston, MA: Cengage Learning.

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