Accounting reports are prepared for internal purposes as a management tool to aid decision making and for external purposes to disclose to interested parties the financial affairs of the business. So the design must cater for a wide variety of needs.
The system must be able to comply with government requirements, such as those for the Bangladesh Taxation Office and Work Cover, and must be presented in a way that shows the business financial position for the information of outsiders, such as banks and creditors, as well as for the needs of management.
Stages in the design for both a manual or computerized accounting system include:
1. Collecting input information, including source documents
2. Recording transactions in journals, ledgers and extracting a Trial Balance
3. Producing financial reports and statements
4. Producing information for use internally to better control and optimize the business potential
5. Storing of information for future reference; for example, for auditing purposes, the Bangladeshi Taxation Office requires data to be available for the past five years, and also for comparing results with previous accounting periods.
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