Question

usly to make your ont Exercise 10-4 (Managerial] ant for Mitchell Manufacturing, Inc., a large inanc You are a staff accou LAN manufacturing company. Mitchell has four sales divisions. ants, and a home office in Dearborn, Michigan. manufacturing plants, and a home office in De e administrative offices. Management is considering accounting and auditing for the first time. Jeff Smart, using the cloud in accounting and auditing forth Chief Operating Officer of Mitchell, has asked yo lowing questions in a memo: • What is the cloud? • How might Mitchell Manufacturing use the cloud in accounting and auditing? • What advantages might there be to Mitchell Manufacturing of the cloud?

Write a memo to Mr. Smart containing the answers to these questions.

Answer 1

Ans.: What is Cloud: Cloud is a kind of technology wherein without physical holding client user can access on demand the availability of computer system resources, computing and data storage. Herein no need of direct holding or active management by user of service.

Use of Cloud in Accounting & Auditing: To use of cloud technology, Mitchell Manufacturing has to take services of cloud service provider. In existing system, the Mitchell Manufacturing will be having computer system at each of his four location which will be having server, data storage and computing location specific. But in cloud technology, Mitchell Manufacturing accounting software will run on cloud. Which will also help Auditor to access the data at there location once access rights are awarded to them.

Advantage of Cloud Technology : Old system of location specific computer system must be causing problem in accessing the data or accounting information of one location at another location. For which his account department will be transferring data for consolidation and audit purpose through travel of data storage devices. Whereas if Mitchell Manufacturing uses cloud technology they need not to bother all these challenges as access to the cloud system is attainable at any time and from any geographical location. This helps in running the business successfully. Traditional IT framework prevents work productivity whereas a cloud system can provide better security, better control & data backup.