FINANCIAL INFORMATION SYSTEM

INTRODUCTION
Finance function (broader scope) - Manage the firms assets - Manage the capitalization of the firm Accounting function (comparatively narrow scope) - Maintaining and managing firms resources - Recording transactions

DECISIONS
Firm has to make decisions at financial and accounting levels - Where to raise funds and how much? (financing decision) - Where to invest funds and up to what extent? (investment decision) - How much to pay as dividends? (dividend decision) FMS supports the decision making process and keeps a track on the financial assets and fund flows.

TYPES OF FIS AND AIS

SYSTEM
Profit planning Strategic

LEVEL IN THE ORGANIZATION

DESCRIPTION
Establish long term investment goals and provide long term forecasts Plan the long term profits Controls firms financial resources Prepare short term budgets

Budgeting

Management

Portfolio Analysis

Knowledge workers

Provides tools to determine the right mix of debt and equity and portfolio of investment that provides maximum returns at minimum risks
Track of day to day transactions like payments to vendors, paychecks etc.

Accounts receivable

Operational

FIS CATEGORIES
Cash and investment management Capital budgeting Financial forecasting Financial planning

COMPONENTS
Data Information

Accounting Information Subsystem Internal Audit Subsystem

Forecasting Subsystem Funds Management Subsystem Control Subsystem

Data

Databas e

Information

Finance Intelligence Subsystem

Data

Information

ADVANTAGES OF FIN
Improve speed and accuracy of reporting Provide information and analytical support Various Software packages for FIS are Tally BMS Sage Accpac ERP SAP Greentree Microsoft Dynamics AX

USERS
Equity investors Creditors Suppliers Employees Customers Governments, their agencies and regulatory bodies Members of the public.

ACCOUNTING INFORMATION SYSTEM

Management

Information
Data Processing Software Information

Accounting Information System

Database

Data

Data Physical resources Transformation

PROCESS OF AIS
Data gathering Data manipulation Data storage Document preparation

THANK YOU