Question

1. Identify the Enterprise Resource Planning software (ERP) and how it differs from the Accounting Information System

Answer 1

1. Enterprise Resource Planning [ERP] Software :

An ERP is a process by which an enterprise manages and integrates different parts of it's business. An ERP software integrates many areas such as sales, inventory, planning, purchasing, etc. It helps the organisation to adapt with the rapid changes that the organisation may be required to undergo in this era of rapid globalisation.

Benefits of ERP software includes increased efficiency, improving competitiveness, accurate forecasting, scope for collaboration, scalability and savings in cost.

Some of the examples of ERP software include Sage 100, Netsuite, Microsoft Dynamics GP, Epicor 9 etc.

2. How it Differs from Accounting Information System:

Some of the differences are as follows:

1. The scope of accounting software does not cover manufacturing management whereas ERP covers manufacturing management.

2. Accounting information systems does not cover sales management and order processing, whereas ERP covers the same.

3. Increased accuracy of inventory control in ERP software than accounting information system.

4. ERP software is a solution to multiple business processes whereas accounting software is just a software.