Advantages & Disadvantages of a Computerized Accounting System

Updated February 21, 2017

The field of accounting relies on precise organisation and analysis of numbers and financial data. This makes it an ideal place for computerised tools to make the lives of human accountants easier and allow businesses to produce more accurate financial reports. But to have a positive impact, computerised accounting systems require careful planning and awareness before implementing them.

Increased Productivity

Accountants who have access to computerised accounting systems can work more quickly and enjoy increased productivity. The software allows accountants to make changes faster than adjusting a printed ledger or chart. Less time spent processing data gives accountants more time to analyse the data and get the most use out of it. Displaying financial data on computer screens is also more efficient and environmentally friendly than printing paper reports for even small tasks. Data organisation tools make it easy to find specific pieces of information at any given time.

Increased Accuracy

A computerised accounting system reduces the risk of human error. Computers process numbers and perform calculations with 100 per cent accuracy, which eliminates the possibility of a mathematical error leading to an inaccurate result. Accounting software also makes regular backups of key data for retrieval in the event of a system failure or security breach. While there is still room for error in the case of data entry, accounting software can identify inconsistencies and even help correct simple mistakes.


Updating a traditional accounting department to use a computerised system can represent a significant cost, especially for a larger business. Besides reorganising personnel and buying the accounting software a business must also invest in new computers, regular software updates, training and a new recruiting policy to hire accountants who are familiar with the system or can learn to use it quickly.

Human Need

Despite their advancing complexity, computerised accounting systems can't fully replace human accountants. The field of accounting requires judgment decisions and improvisational thought, which even the most sophisticated piece of software can't do. Accountants also need to understand the changing landscape of legal regulations and company policies, some of which find their way into new versions of computerised accounting systems and others that control how accountants use their computerised tools.

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