Computerized Accounting Vs Manual Accounting : A Complete Handbook

computer accounting systems

The accounting records, processes and submits the financial transactions to produce financial statements that are helpful for the readers in the decision-making process. In tradition, a qualified accountant uses the registers, account books, vouchers, etc. for accounting purposes manually. Now, however, due to their accuracy, simplicity, and speed, computerized accounting is in favor of the rising technology.

The same ideas, norms, and accounting concepts provide the basis for both manual and automated systems. In that manual accounting employs pen and paper to document transactions, however, they differ only in its process, whereas computerized accounts utilize computers and the internet to electronically input transactions.

Computerized Accounting Vs Manual Accounting in a Nutshell

The distinction between manual and computerized accounting is that in manual accounting, all financial transactions are kept in a register or an accounting book, whereas in computerized process accounting, all financial transactions are kept in accounting software.

Manual accounting employs a number of paper ledgers and diaries in which accountants record financial data. The main ledger contains a variety of transactions as well as the total balance of all subsidiary ledgers and journals. Manual accounting is highly thorough because accountants must meticulously input data into physical records. Computerized accounting use software programs derived from manual accounting techniques. Computerized accounting entails the use of computers, spreadsheets, and programs to electronically record and report financial data.

The accounting program is in charge of ensuring that journal entries balance before uploading information to the company’s general ledger. Prior to producing financial reports, many financial reports and statements have a default function to verify all information is correct and legitimate.

Manual accounting is sluggish, but automated accounting is much faster. It contains calculation errors, while automated accounting does not.

computer accounting systems

Manual Accounting Explained

computerised accounting system

Manual accounting – as it is known by name – is the paper-based accounting method used to record, classify and analyze the company’s financial transactions using journal and ledger registers, vouchers, and account books. Small companies, such as sole owners, customers, etc., typically utilize it to keep track of company transactions at reduced costs.

The simple accessibility of the manual accounting method is one of the advantages.

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Computerized Accounting Systems Defined

computer accounting system

The computerized accounting system that employs the computerized accounting system and pre-packaged, customized accounting software can be defined as an accountability system for recording and producing financial reports. Which of the following is not an advantage of a computerized system over a manual system?

The computerized journal of accounting relies on a database idea.

The two main things are:

Accounting framework: The framework includes record-keeping principles and a grouping structure.

Operating procedure: A appropriate system operation procedure for storing and processing data is established.

In order for data to be store in a database-oriented application, it will further require a front-end interface, back-end database, database processing, and reporting systems. Computer accounting system’s advantages depending on their speed, accuracy, dependability, readability, information, and reports up-to-date.

What is the Significance of Both?

Traditional manual accounts were a laborious procedure in which accountants had to spend huge sums of time precisely verifying their figures. Significant errors might occur, such as the transposition of numbers or putting information in the incorrect column. Computerized accounting systems allow accountants to use easier review procedures to manage more information than before. Accountants may take less time to check for mistakes and more time for decision analysis. That’s why churches have dedicated accounting software.

Why go to Computerized Accounts from Manuals?


Speed is the major difference between manual and computerized accounting systems methods. Not only can accounting software process and report considerably more quickly than manual methods, but also permits quicker data entering. Comprehensive computerized accounting saves you a lot of time, as it enables rapid and precise collection and printing of documents such as invoices, purchase orders, and payroll.

High Precision

Traditional manual accounting is a laborious procedure that requires accountants to spend a great deal of time verifying corporate statistics numerically. Significant errors might occur, such as the transposition of numbers or putting information in the incorrect column. Computerized accounting systems let accountants use accurate financial reporting to handle more information than before. Computerized accounting solutions also enhance inventory control and collection of payments, enable you to save time, and boost cash flow because of their efficiency and convenience of use. Accountants may spend less time looking for mistakes and analyzing more time.


Manual accountability is a lot more laborious than electronic accounts. You must properly create columns, double-check your job and write numbers physically. These regular duties are effectively performed by computerized systems that automatically update and continue records. In software programs, all calculations are automatically done, reducing mistakes and improving efficiency.

Time to Time Reporting Process

It might take time for the information from each book to be located and compiled in a report with a manual approach. The analysis will be laborious under the ‘What If?’ manual system. Computerized accounting enables the speedy recovery of data.

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Since the number of company transactions rises, manual account management is challenging, as updating a single transaction in all of the accounts it impacts takes a lot of time. A lot of manual accounting restrictions are not there in computerized accounting.

That’s it, we have tried to cover all the differences between manual and automatic accounting systems. If you liked this post, don’t forget to comment down below and let us know. Your response is very vital to us.

Also, check out other posts like small business accounting software on our website. They are going to be of great use to you.

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