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ERP Systems and the Impact on Financial and Management Accounting

Explore the differences between financial and management accounting and how ERP systems benefit workers in both areas. Discover how ERP systems save time for accountants and the impact of changes like the Sarbanes-Oxley Act on the demand for accountants.

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ERP Systems and the Impact on Financial and Management Accounting

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  1. Tutorial 11 Financial Management

  2. Q1 a) Differences between Financial Accounting & Management Accounting

  3. Q1 b) How can an ERP system benefit workers in both areas? Both Financial and Management Accounting modules Provide workers a wealth of real-time and accurate information on demand Have built-in reporting features that reduces laborious work in preparing a variety of reports

  4. Examples of how ERP systems can save time for accountants: • Financial statement preparation, especially for companies with subsidiaries • Preparation of management reports for decision making • Gathering, summarising and analysing data • Providing data for operating decisions (e.g. credit management) • Inventory cost accounting • Tracking events in completing a transaction (e.g. a sales order) • Q3) ERP systems save time for accountants in many ways • Expected that the employment of accountants would diminish • Needed more than ever in industry • ------------------------------ • Explain how changes such as the introduction of the Sarbanes-Oxley Act has impacted the demand for accountants • Look on websites like careerone.com.au or seek.com.au Sarbanes-Oxley Act has caused a huge need for accountants and individuals with finance majors in accounting because of the added reporting, documentation and verification of controls required in organisations Further, think about the job advertisements you have looked at on Seek.com.au and careerone.com.au recently

  5. Q4 – Credit Checking • Given the state of the system, will credit be granted or denied for ABC Corporation’s current order? • If the system processed data in a more timely way, would credit be granted or denied?

  6. Q4 – Credit Checking • First find out how much the client is owning the company money • Calculate the current order value $32 X 100 = $3,200 • Find out outstanding A/R $6,000 • Total amount payable $9,200 • Client’s credit limit is $8,000 • Client’s outstanding unpaid amount is $9.200 > Credit Limit , reject the current order for the 100 chain locks

  7. Additional Critical Path Question 1

  8. Additional Critical Path Question 1 Critical Path  A-C-D-F, which is 18 days

  9. Additional Critical Path Question 2

  10. Additional Critical Path Question 2 a and b Critical Path  A-B-F-H-I-L ( 28 weeks)

  11. Additional Critical Path Question 2 c Critical Path  A-B-F-H-I-L ( 28 weeks) If Activity E’s earliest start time was delayed by 1 week, what effect(s) will this have on Activity J’s earliest start time, earliest finish time and slack? E delaying 1 week will have no effects on J, because E has 2 weeks slack, which more than the 1 week delay

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