DR.

MPS MEMORIAL COLLEGE

OF BUSINESS STUDIES SIKANDRA, AGRA-282007

ON
SUBJECT: COMPUTERISED ACCOUNTING
BACHELOR OF COMMERCE
SEMESTER 2
SESSION: 2024-27

SUBMITTED TO SUBMITTED BY
MILIND SAXENA TANVI SINGH
(Assistant Professor) Roll No. 2502670070124

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 CERTIFICATE

This is to certify that research project titled. “COMPUTERISED

ACCOUNTING” Submitted by TANVI SINGH Roll No. 2502670070124 for the
fulfillment of the requirement of BACHELOR OF COMMERCE (Session 2024-
27) as per the requirement of the B.com curriculum from DR. MPS MEMORIAL
COLLEGE OF BUSINESS STUDIES, AGRA Originality and informative work
done by him under my supervision.

MILIND SAXENA SANDEEP SAXENA

(Internal Supervision) (H.O.D)

2
 DECLARATION

I TANVI SINGH (B.Com) student of DR. MPS MEMORIAL COLLEGE

OF BUSINESS STUDIES, AGRA hereby declare that the following Project
Report on “COMPUTERISED ACCOUNTING” is an original piece of work. No
part ofthis Project Report is either copied or totally taken from other sources.

Signature
Name: TANVI SINGH
Roll No. 2502670070124

(B.COM. 2ND SEMESTER)

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 Acknowledgement

I would like to express my special thanks of gratitude to My (H.O.D) “Mr.

SANDEEP SAXENA” and as well as our (Supervision) “Mr. MILIND
SAXENA” DR. MPS MEMORIAL COLLEGE OF BUSINESS STUDIES,
AGRA who gave me the golden opportunity to do this wonderful Project of
“COMPUTERISED ACCOUNTING”. Which also helped me in doing a lot of
research and I came to know aboutso many things.
Secondly, I would also like to thank my parent who helped me a lot in financing
thisproject within the limited frame.

Signature
Name: TANVI SINGH
Roll No.: 2502670070124

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 INDEX

S. NO. TOPIC PAGE NO.

Compare the advantages and

1. disadvantages of manual 6 to 11

accounting versus computerized

accounting.

Evaluate different accounting

software packages available in
12 to 19
2. the market and discuss their
features, pricing, and suitability
for various business sizes.

Explore the security measures

3. required to protect financial data in
19 to 26
computerized accounting systems and
discuss the importance of data integrity
and confidentiality.

5
 1. Compare the advantages and
disadvantages of manual
aCCounting versus Computerized
aCCounting.

Introduction
Accounting is an essential function in any business, ensuring
proper financial tracking, decision-making, and compliance with
regulations. Traditionally, businesses relied on manual
accounting, which involved recording transactions by hand in
ledgers and journals. With advancements in technology,
computerized accounting has become the norm, using
accounting software to automate and streamline processes.
Both methods have their advantages and disadvantages,
depending on business needs, size, and available resources.
Below is a detailed comparison.

1. Definition

• Manual Accounting: The process of recording financial

transactions manually using physical books and ledgers.
• Computerized Accounting: The use of accounting software
to record, store, and process financial data electronically.

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2. Advantages of Manual Accounting

1. Simplicity

• Requires no specialized training or expensive software.

• Small businesses with limited transactions can manage it
easily.
2. Lower Cost

• No need for expensive software, updates, or system

maintenance.
• Only requires physical books and stationery.
3. Less Risk of Cyber Threats

• No exposure to hacking, viruses, or data breaches.

• No reliance on cybersecurity measures.
4. Flexibility

• Accountants can customize records without software-

imposed limitations.
• Easier for small-scale, unique, or specialized accounting
needs.
5. Physical Record-Keeping

• Hard copies provide tangible records, reducing reliance on

electronic data.
• Can be useful in audits and legal proceedings.

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3. Disadvantages of Manual Accounting
1. Time-Consuming

• Recording, calculating, and verifying transactions manually

is slow.
• Financial reports take longer to prepare.
2. Higher Risk of Human Error

• Prone to miscalculations, omissions, and duplication of

records.
• Requires extensive cross-checking.
3. Difficult to Handle Large Data

• Managing multiple transactions becomes cumbersome.

• Large businesses find it inefficient.
4. Limited Reporting and Analysis

• No automatic report generation or financial analysis tools.

• Difficult to extract real-time insights.
5. Storage Issues

• Requires extensive physical storage space.

• Risk of records getting lost, damaged, or destroyed.

4. Advantages of Computerized Accounting

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1. Speed and Efficiency

• Automated calculations and report generation save

time.
• Transactions can be recorded instantly.
2. Accuracy and Reduced Errors

• Automated processes minimize human errors in

calculations.
• Built-in error detection improves data reliability.
3. Data Security and Backup

• Data can be encrypted and protected from

unauthorized access.
• Cloud storage options ensure backup and disaster
recovery.
4. Real-Time Financial Analysis

• Instant reports and dashboards provide insights for

decision-making.
• Customizable financial reports allow better
forecasting. 5. Scalability
• Can handle large volumes of transactions.
• Suitable for businesses of all sizes.
6. Integration with Other Systems

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 • Can integrate with payroll, tax, and inventory management
software.
• Facilitates better business coordination.

5. Disadvantages of Computerized Accounting

1. Initial Setup and Maintenance Costs

• Software licenses, updates, and IT support can be

expensive.
• Requires periodic maintenance.
2. Risk of Data Loss and Cyber Threats

• Susceptible to hacking, data breaches, and system failures.

• Requires strong cybersecurity measures.
3. Dependence on Technology

• System crashes, bugs, or software issues can disrupt

operations.
• Businesses must rely on IT support for troubleshooting.
4. Training Requirements

• Employees need training to use accounting software

effectively.
• Updates may require additional learning.
5. Compatibility Issues

10
 • Not all software may integrate smoothly with existing
systems.
• Software migration can be complex.

6. Conclusion

Both manual and computerized accounting have their strengths

and weaknesses. Small businesses or those with low transaction
volumes may find manual accounting sufficient due to its cost-
effectiveness and simplicity. However, for larger businesses or
those requiring efficiency, accuracy, and scalability,
computerized accounting is the preferred choice.

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2. evaluate different accounting
software PacKages availaBle in
tHe MarKet and discuss tHeir
features, Pricing, and suitaBility
for various Business sizes.

Introduction
Accounting software plays a crucial role in financial
management, enabling businesses to track income, expenses,
and financial performance. This document evaluates various
accounting software packages, discussing their features, pricing,
and suitability for different business sizes.
Criteria for Evaluation
Before diving into the individual software packages, it is
essential to establish the evaluation criteria. The key factors
considered include:
1. Features - Core and advanced functionalities such as
invoicing, expense tracking, payroll, tax management, and
reporting.
2. Pricing - Cost structure, including one-time fees,
subscription models, and additional costs for add-ons.

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 3. Ease of Use - User interface, learning curve, and customer
support availability.
4. Scalability - Suitability for different business sizes, from
freelancers to enterprises.
5. Integration - Compatibility with other business tools such
as CRM, ERP, and banking systems.
6. Security - Data encryption, backup features, and
compliance with financial regulations.
Overview of Popular Accounting Software
1. QuickBooks Online
Features:
• Cloud-based with access from multiple devices
• Automated invoicing and expense tracking
• Bank reconciliation
• Payroll and tax management
• Customizable reports
• Third-party integrations
Pricing:
• Simple Start: $25/month
• Essentials: $50/month
• Plus: $80/month

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 • Advanced: $180/month
Suitability:
• Ideal for small to medium-sized businesses
• Advanced plans cater to growing enterprises
2. Xero
Features:
• Cloud-based with multi-user access
• Invoicing and bill payments
• Bank reconciliation
• Inventory management
• Payroll integration
• Project tracking
Pricing:
• Starter: $13/month
• Standard: $37/month
• Premium: $70/month
Suitability:
• Suitable for small businesses and growing startups
• Premium plan supports multiple currencies, making it good
for international businesses

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3. FreshBooks
Features:
• User-friendly interface
• Time tracking and project management
• Automated invoicing and payments
• Expense tracking and reporting
• Third-party integrations
Pricing:
• Lite: $17/month
• Plus: $30/month
• Premium: $55/month
Suitability:
• Best for freelancers, self-employed professionals, and
small businesses
• Lacks advanced enterprise features
4. Zoho Books
Features:
• End-to-end accounting solutions
• Automated workflows
• Tax compliance and audit trail

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 • Bank reconciliation
• Multi-user support
• Integration with Zoho ecosystem
Pricing:
• Free Plan: $0/month (for businesses with revenue under
$50K annually)
• Standard: $15/month
• Professional: $40/month
• Premium: $60/month
Suitability:
• Ideal for small and medium-sized businesses, especially
those using other Zoho products
5. Wave Accounting
Features:
• Free accounting and invoicing software
• Unlimited invoicing, income, and expense tracking
• Payroll and payments (paid add-ons)
• Bank reconciliation
• Double-entry accounting
Pricing:
• Free for accounting and invoicing

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 • Payroll: Starts at $20/month + $6 per employee
Suitability:
• Best for freelancers and very small businesses looking for a
free solution
6. Sage 50Cloud Accounting
Features:
• Robust desktop software with cloud connectivity
• Advanced reporting and financial management
• Payroll and inventory tracking
• Audit trails and tax compliance
• Multi-user collaboration
Pricing:
• Pro Accounting: $58.92/month
• Premium Accounting: $96.58/month
• Quantum Accounting: $160.00/month
Suitability:
• Suitable for mid-sized businesses that need advanced
features and reporting
7. NetSuite ERP
Features:
• Comprehensive enterprise resource planning (ERP)

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 • Advanced financial management and automation
• Customizable dashboards and analytics
• Multi-subsidiary and multi-currency support
• Inventory and supply chain management
Pricing:
• Custom pricing based on business requirements
Suitability:
• Ideal for large enterprises and businesses with complex
financial needs
Comparison Table
Software Starting Price Features Best For
QuickBooks Invoicing, payroll, Small to medium
$25/month
Online reporting businesses
Small
Invoicing, multi- businesses,
Xero $13/month
currency, payroll international
trade
Time tracking,
Freelancers,
FreshBooks $17/month invoicing,
small businesses
expenses

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 Tax compliance, Small to medium
Zoho Books $15/month
automation businesses
Wave Basic accounting, Freelancers,
Free
Accounting invoicing small businesses
Sage Advanced Mid-sized
$58.92/month
50Cloud reporting, payroll businesses
Enterprise-level
NetSuite Large
Custom financial
ERP enterprises
management
Conclusion
Choosing the right accounting software depends on business
size, budget, and specific financial management needs. Small
businesses and freelancers may find FreshBooks or Wave
sufficient, while mid-sized businesses may benefit from
QuickBooks, Xero, or Zoho Books. Larger enterprises with
complex financial structures may require Sage 50Cloud or
NetSuite ERP.
Understanding the strengths and limitations of each software
helps businesses streamline financial processes, ensuring
compliance and operational efficiency.

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 3. explore the security measures
required to protect financial data
in computerized
accounting systems and discuss the
importance of the data integrity
and confidentiality.

Introduction
In the modern financial landscape, computerized accounting
systems have become the backbone of financial management
for businesses, governments, and individuals. These systems
handle sensitive financial data, making them prime targets for
cyber threats. To protect financial data, organizations must
implement robust security measures to ensure data integrity
and confidentiality. This paper explores the security measures
required to safeguard financial data in computerized accounting
systems and highlights the importance of maintaining data
integrity and confidentiality.
Importance of Data Integrity and Confidentiality Data Integrity
Data integrity refers to the accuracy, consistency, and reliability
of financial data throughout its lifecycle. It ensures that
financial records remain unaltered unless modified by

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authorized personnel. Maintaining data integrity is crucial for
compliance with regulatory requirements, accurate financial
reporting, and informed decision-making.
Confidentiality
Confidentiality ensures that sensitive financial data is accessible
only to authorized individuals. Unauthorized access can lead to
fraud, identity theft, and financial losses. Organizations must
implement access controls, encryption, and other security
measures to protect financial data from breaches.
Security Measures for Protecting Financial Data 1. Access
Control Mechanisms
Access control mechanisms limit who can access financial data
based on roles and responsibilities. Key access control methods
include:
• Role-Based Access Control (RBAC): Assigns permissions
based on user roles to minimize unauthorized access.
• Multi-Factor Authentication (MFA): Requires multiple
authentication methods, such as passwords and biometric
verification.
• Least Privilege Principle: Ensures users have only the
necessary access required to perform their tasks.

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2. Encryption

Encryption transforms financial data into an unreadable format,

preventing unauthorized access. Common encryption methods
include:
• End-to-End Encryption: Secures data in transit and at rest.
• Advanced Encryption Standard (AES): A widely used
encryption standard for securing financial data.
• Public Key Infrastructure (PKI): Uses digital certificates for
secure communication.
3. Secure Network Infrastructure

A secure network infrastructure prevents cyber threats such as

hacking and data breaches. Measures include:
• Firewalls: Monitor and control incoming and outgoing
network traffic.
• Intrusion Detection and Prevention Systems (IDPS):
Identify and respond to malicious activities.
• Virtual Private Networks (VPNs): Secure remote access to
financial systems.
4. Regular Security Audits and Compliance Checks

Regular security audits help identify vulnerabilities in financial

systems.
Organizations must adhere to compliance standards such as:

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 • General Data Protection Regulation (GDPR): Protects
personal financial data.
• Sarbanes-Oxley Act (SOX): Ensures financial data accuracy
and accountability.
• Payment Card Industry Data Security Standard (PCI DSS):
Protects credit card transactions.
5. Secure Data Storage and Backup

Ensuring data is securely stored and backed up prevents loss

due to cyberattacks or system failures. Best practices include:
• Cloud Security Measures: Encrypt cloud-stored financial
data.
• Regular Backups: Store backups in multiple secure
locations.
• Disaster Recovery Planning: Implement strategies for
quick data restoration.
6. Employee Training and Awareness

Human error is a significant security risk. Employee training on

cybersecurity best practices can reduce threats such as phishing
and social engineering attacks. Key training topics include:
• Recognizing Phishing Emails: Employees must identify and
report suspicious emails.
• Strong Password Policies: Encourage the use of complex
passwords.

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 • Incident Response Protocols: Train employees on how to
respond to security breaches.
7. Secure Software Development Practices

Financial software should be developed using secure coding

practices to prevent vulnerabilities. Best practices include:
• Regular Security Patching: Keep financial software
updated.
• Penetration Testing: Simulate cyberattacks to identify
security gaps.
• Code Reviews: Ensure secure coding practices.
8. Fraud Detection and Prevention Systems

Automated fraud detection systems analyze financial

transactions for suspicious activity. Methods include:
• Machine Learning Algorithms: Detect anomalies in
financial transactions.
• Behavioral Analytics: Identify unusual login patterns.
• Real-Time Alerts: Notify administrators of potential fraud
attempts.
9. Third-Party Security Assessment

Organizations often rely on third-party vendors for accounting

software. A security assessment of third-party providers

24
ensures they adhere to security standards. Key considerations
include:
• Vendor Security Certifications: Ensure compliance with
industry standards.
• Data Processing Agreements (DPAs): Define how third
parties handle financial data.
• Service-Level Agreements (SLAs): Establish security
expectations.
10. Incident Response and Recovery Plan

Having a well-defined incident response plan helps mitigate the

impact of security breaches. Essential components include:
• Incident Detection: Monitor financial systems for security
incidents.
• Response Protocols: Define steps to contain and eliminate
threats.
• Post-Incident Analysis: Learn from incidents to strengthen
security measures.
Conclusion
Protecting financial data in computerized accounting systems is
essential to maintain data integrity and confidentiality.
Organizations must implement comprehensive security
measures, including access controls, encryption, network
security, and regular audits. Employee training, fraud detection,

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and secure software practices further enhance data protection.
By adopting these measures, businesses can safeguard financial
data against cyber threats and ensure compliance with
regulatory standards.

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