How to Test for Impairment of Goodwill?

Impairment of Goodwill or impairment of goodwill loss informs about the destruction in this intangible asset. So, Financial Accounting Standards Board (FASB) has made rules 141 and 142 which explain about this. We know goodwill is important part of total value of company. If any company acquires any other company, then it sees whether goodwill has impaired or not because it affects the acquisition value. So, to do the test for impairment of goodwill is very important for any accountant.

It has following simple steps:

1st Step: To Compare Fair Market Value of net assets with book value of net assets

This is the first step to test for impairment of goodwill. In this step, The fair market value of the reporting unit is calculated. This valuation is done as of a specific date and must be repeated annually at the same time each year.

a) When there is no impairment

If fair market value of net assets > carrying value or book value of net assets.

If the fair market value is equal to or greater than the unit’s carrying value, then goodwill of the reporting unit is not considered to be impaired. Thus, step 2 of the impairment test is not necessary.

b) When there is impairment loss

If fair market value of net assets <  carrying value or book value of net assets

if the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any.

2nd Step : Compare Book value of Goodwill with Fair Market Value of Goodwill

In this step, the implied fair market value of goodwill is estimated and compared to the carrying value or book value of goodwill for the reporting unit. If the carrying amount of goodwill exceeds its implied fair market value, an impairment loss equal to this excess is recorded. The recorded loss cannot exceed the carrying amount of goodwill.

You can also thorough study of steps to Test for Impairment of Goodwill with example in the PDF file of at http://www.axiomvaluation.com/Documents/2004.04.27-GoodwillImpairmentPrimer.pdf

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Accounting Education Review 2010

First of all happy new year 2011 !!





founder of accounting education

As we say goodbye to 2010 and get ready to welcome 2011. I wish all our students, accountants and readers  a very happy & prosperous new year 2011. I am sure that the new year will bring lots of happiness, excitement and good moments with accounting education  in your life.

2010 had been a great year for Accounting Education. Our strength today stands at 4000+  pageviews per day from 180+ countries and growing every day. Accounting Education will also celebrate its 3th anniversary on Jan. 19 (Accounting Education Day) 2011 and we all will have a great time. You know that we made planning in the beginning of 2010 in which we promised to write the answers of basic questions of each accounting subject and class. We have succeeded in this. For students reference, we made accounting help, where you can find your financial accounting, cost accounting, corporate accounting and management accounting answers. We have also started to make scanner specially for UGC and CS students.

In the new year, we look forward to lot more excitement, contests, offline city meets and much more. We look forward to your support and contribution in our mission of uniting students and accountants of the world. If you haven't had time to be active on Accounting Education, 2011 is a great way to enrich yourself via Accounting Education.

From Founder

Prof. Vinod Kumar

( profvk2010@gmail.com  )

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New Year 2011 Inspirational Message

Just one day is far from new year 2011. So, I think, this is good time to fill energy in all the students  by writing inspirational message. Motivation and inspiration is the only thing in this world which give us power to learn more and more things. Today, I am taking topic resolution power in my new year 2011 inspirational message.

Resolution power is that thing which is helpful to enhance your internal powers. When a person decides to do any work with his full determination, he surely succeeds in that work. Our whole history is witness of this. A person who has awaken his determination, has achieved success. All the main inventions and researches had been  only done due to the resolution powers of scientists. So, resolution power is very important thing for young students. If scientists had no determination power, it was not possible for them to search these larges new welfare things for human beings.  Resolution power increases your confidence and if you take it, it means you achieves half success at the time of taking that resolution.

I teach you, how can you take resolution? Just bring any thought or work or anything in your mind and pledge, I will do that work or that thing if I have to pay any cost for this. It means, even I have to face my death for this, I will not fear from this. That is real resolution. Suppose, if you decide to learn your college or school books at 4:00 A.M. morning time, then repeat this decision. This will become your determination. After continuous practice of this, you will start to get up 4:00 for learning and will succeed in your educational target.

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Bill of Exchange Accounting

Today, we will cover very important topic of financial accounting. "Bill of Exchange accounting" or "Accounting Treatment of Bill of Exchange" is relating to journal entries of bill of exchange. We try to explain it with video tutorial and contents. First of all we explain basic concepts of bill of exchange

What is bill of exchange?

Bill of exchange is written order letter in which there is not any condition. Writer's sign will be in it. In this letter, order to other person is given to pay the certain sum of money to the writer of letter or to pay any other authorized person or who has this bill of exchange.

Essential of a Bill of Exchange

1. It should be in written.
2. Unconditional order to pay.
3. Signed by writer.
4. Debtor must be a certain person.
5. Payment must be a certain amount.
6. Payment must be done on maturity of bill.
7. Acceptance must be given by debtor on this bill.

Parties of the Bill of Exchange

1. Drawer or Maker or Creditor
2. Drawee or Debtor or Acceptor
3. Payee or who have right to get payment

Maturity Date

Due date of bill is also called maturity date and we can get three day of grace period for paying debt through bill.

Endorsement

If drawer signs on the back side of bill for giving the right to other for getting money from debtor, it will be endorsement.

Dishonour of Bill of Exchange

If drawee or debtor does not pay the money of bill of exchange on maturity, then bill will be dishonour. After this, debtor will be responsible to his unpaid dues.

Journal Entries in the books of Drawer

1. Drawer receives a bill accepted by drawee

Bill receivable account Dr.

To Drawee account

2. Drawee pays the bill on due date

Cash account Dr.

To B/R account

or

2.  Drawee dishonours the bill on due date

Drawee account Dr.

To B/R account

3. If noting charges are paid by drawer

Drawer account Dr.

To Cash account

Journal Entries in the books of Drawee or Debtor

1. Drawer receives a bill accepted by drawee

Drawer account Dr.

To Bill payable account

2. Drawee pays the bill on due date

B/P Dr.

To cash  account

or

2.  Drawee dishonours the bill on due date

B/P account Dr.

To Drawer  account

3. If noting charges are paid by drawer

Noting Charges  account Dr.

To Drawer  account

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Phone Banking Security will be tight with OTP from 1st Jan. 2011

One time password technique has already applied in many advance country for reducing the number of fraud cases relating to phone banking. Now, it is good new that OTP will apply in India from new year 2011. It may the gift of bank customers who are worry for their security on their mobile phones.

According to new announcement of RBI, phone banking security will be more tight from 1st Jan. 2011 in every commercial bank in India. This security norms will be used by applying one time password. A one-time password (OTP) is a  very useful password technique that is valid for only one login session or transaction. OTPs avoid a number of shortcomings that are associated with traditional (static) passwords. Every OTP will be valid for two hours and next time, you need to make new OTP.

Banks will ask for an additional password from their credit card customers from the new year for any transactions conducted over phone or mobile  following a Reserve Bank direction for making phone banking more secure. According to the RBI guideline, from January all banks will mandatorily decline any telephonic transaction, including the automated interactive voice response services, where the customers do not have a one-time password for such.

This new action has been taken due to following reason:

• Increasing the cases of using of stolen credit card.
• Increasing of Credit card frauds.
• Misusing of same password of bank's customer.
• Interactive Voice Response (IVR) leaks  the confidential information like balance, payments, transfers, transaction history of customer in bank in same password on mobile.

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List of Mutual Funds in UK

Now, time has changed. Today, you can invest your money in any mutual fund of any company of any country with the help of Internet. Still, you have the knowledge of foreign companies' mutual funds because with this knowledge, you can understand the trends of such companies and you can invest you money in good mutual funds of foreign companies. You can take first step by searching the list of mutual funds in different countries. We have already made list of mutual funds of many countries. Today, we are showing the list of mutual funds in UK.

1. Threadneedle - Investment - Asset Management Fund UK

It is  a global mutual funds and associated companies. All of our fund managers are based on one floor of its London offices and sharing research, intelligence and ideas is fundamental to the way its work. In 2003, American Express Financial Corporation acquires London-based Threadneedle Asset Management.

2.  First State Investments UK

First State Investments ICVC - Global Property Securities is an OEIC incorporated in the United Kingdom. The Fund's objective is to achieve a total investment return consistent with income and long term capital growth. The Fund invests primarily in a broad selection of securities issued by real estate investment trusts or companies develop or manage real property. First State and CFSGAM collectively manage £93.3 billion* on behalf of investors worldwide.

3. Franklin Templeton Funds UK

Franklin Templeton Funds - Franklin Global REIT Fund is an open-end investment company incorporated in the United Kingdom. The Fund's objective is to maximize total investment return consisting of income and capital appreciation through investing in property securities such as REITs and other companies whose principal business is property oriented. Franklin Templeton Investment Management Limited, is authorised and regulated by the Financial Services Authority. Registered in England and Wales.

4. Aberdeen New Thai Investment Trust PLC

 Aberdeen New Thai Investment Trust PLC is a closed-end fund incorporated in the United Kingdom. The aim of the Fund is to provide shareholders with a high level of long-term, above-average capital growth through investment in Thailand. The Fund invests in quoted and unquoted securities.


5. Rothschild Private Fund Management

Rothschild Private Fund Management - Balanced Fund is an open-end fund incorporated in the United Kingdom. The Fund's objective is to provide long term capital growth, through a balanced approach. The Fund invests primarily in fixed income, equities, debt instruments, warrants, money market instruments, derivatives and forward transactions, deposits, collective investment schemes.

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Stock Group Vs Stock Category

Yes, I got one query in which an accountant wants to know the difference between stock group and stock category.

Stock group and stock category are the great tool to manage inventory. If you are doing your accounting work in dealing with inventory, then it is your prime duty to manage inventory. So, you can make stock group and stock category. First of all, I define both

What is Stock Group?

Ans :  Stock group classifies the stock items into different dealer. Suppose, we have to buy paint, there may be A, B and C dealers. So, all the items of paint stock will be grouped under A, B and C.

What is Stock Category?

Ans. Stock category is next dimension to classify same stock item. Suppose, if we have same dealer but different brand or price stock, then we can make category as grade 1 of A stock group and and we can show that stock item. Again we can classify as grade 1 of A stock group and mention stock items.

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New Opportunity for Online Teaching

Are your online teacher like me and have one mission to spread online education through making your teaching video and uploading in YouTube? For all these teacher should be concentrate that new opportunity which is coming for all such online teachers. You all know that after coming of 3G technology, consumption of learning and educational video contents has been increased more than 80% by Mobile users. So, all those online teachers who make video and have good page views on YouTube can contract with such 3G host company and spread your online teaching profession to Mobile servers also.

Moreover 3G services providing company will search to you and send you the message like this.

We see that you are very active on YouTube and are keen to share educational Knowledge by uploading videos on accountancy. Here we provide you with an opportunity where you can monetize your content video.

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Wikileaks Finance

Wikileaks finance is different from wikipedia finance which we already mentioned. Wikileaks finance means to open top secrete finance information  in which it can show the big corruption or fraud in financial sector, banks or other financial institutions.

Recently visiting wikileaks, I found that soon next cable will open more burning issues relating to finance sector. As accounting and finance teacher, I am always interested to know, what is wrong happening in area of finance around us, so that we can teach students about how to deal these big finance issues in future.

One of more important things in wikileaks finance that  all secrete opens with solid proof and evidence which are leaked due to anonymous way. So, there is no place of doubt.

But on the other side big financial institutes on Internet, are saying that wikileaks finance is totally illegal.

But, I think that truth is truth. Way of finding truth may be legal or illegal.

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New Enhancements to Google Docs in 2010

Now, 2010 is going to end. Google Docs Team has announced his 85 new enhancements and other developments which it has done in Google Docs. Google Docs is mostly used by modern accountant for online excel sheet. So, it was very necessary to learn some of its new things.

1. Formula highlighting in spreadsheets

In the new version of Google Spreadsheets, cell references and the corresponding cells are now highlighted to make it easier to keep track of your formulas.

2. Upload and store your files in the cloud with Google Docs

Instead of emailing files to yourself, which is particularly difficult with large files, you can upload to Google Docs any file up to 250 MB. You'll have 1 GB of free storage for files you don't convert into one of the Google Docs formats (i.e. Google documents, spreadsheets, and presentations), and if you need more space, you can buy additional storage for $0.25 per GB per year. This makes it easy to backup more of your key files online, from large graphics and raw photos to unedited home videos taken on your smartphone. You might even be able to replace the USB drive you reserved for those files that are too big to send over email.

3.  New Visualizations in Charts

Google Docs Team have added annotated time-lines, organizational charts, gauges,  popular motion chart (which makes it easy to visualize data changing over time) and more to our chart types.

This team have also given our existing charts a more professional look and feel with with a refreshed color palette, improved layout and new customization options.

With these new chart types, we’ve also added a new charts editor that suggests recommended charts, matches your data labels and headers, auto selects colors, has a full size preview pane and more. The editor is designed to help you create the chart you need in just a few clicks

4. More tools for viewing document revisions

Google Docs announced that a new revision history interface is now available in Google documents. To see it, go to File > See revision history.

5. Advanced Sorting Rules in Google spreadsheets

In April, Google Docs launched a new version of Google spreadsheets. One new feature that helps organize your data is advanced sorting rules.

Sorting a selection

With the new sorting capabilities, you can sort a small selection of cells without affecting the rest of your spreadsheet. In my triathlon spreadsheet, for example, I could sort only the selection about running while leaving the biking and swimming sections intact. First, I highlight the range of cells in my spreadsheet about running.

Then, I go to the Tools menu and select Sort. Now I can set a sorting rule. In this case, I'd like to sort my running races by date.

Last, I click the Sort button, and my running times are organized by date.

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Vertical Form of Balance Sheet

Vertical form of balance sheet does not demonstrate just financial position but it also shows the flow of fund in one year. We can create our balance sheet in such shape for knowing the exact position of our funds. If we include the previous figures of liabilities and assets, then we need not to make fund flow statement because to show the comparison of two period vertical balance sheets is just like fund flow statement. In short cut, it fulfills the requirement of fund flow analysis. One more mystery can be analyzed with this form of balance sheet. We can evaluate changes in working capital by comparing two vertical balance sheets.

Morover, most of the companies today use the vertical form for reporting because with this balance sheet looks without any clutter.

Now, we tell you the structure of vertical balance sheet. Basic formula is of accounting equation.

Capital + Liabilities = Assets

↓

Shareholder’s fund + long term liabilities + short term liabilities = Fixed assets + current assets

↓

Shareholder’s fund + Long term liabilities = Final Assets + Current Assets – Current Liabilities

↓

Source of Fund = Application of Fund



Related : How to Prepare the Balance Sheet of Company

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How to Deduct TDS for Rent for Using Airtel Underground Wire?

Problem

we are a private ltd company in service sector providing technical consultancy, my problem is that we have to pay 1,00,000/- P.M. to Airtel as rent for using their underground wire to connect our Three branch office at different cities via common server. how  to deduct  TDS  under which head?

Solution

This is payment and this will be under indirect expenses. Now, as accountant, your one more duty that is to deduct TDS from total payment of rent to Airtal and deposit it to govt. account. For this, you must know the nature of payment because all the sections of TDS in Income Tax Law are according to nature of payment. In above case, Rent of plant, machinery or equipment section will be apply for deducting TDS because  Airtel is providing you the service of their equipment. Cables are comes under equipment of Airtel.

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Management Accountant

Management accountant is that responsible person who provides accounting information for managerial decisions. He is also known as controller, accounts controller, head accountant or financial advisor. If he provides correct accounting information to management, then he can not be responsible for wrong decisions of management.
Functions of Management Accountant

1. Budget Making

For controlling managerial plan, he makes revenue and capital budget.

2. Reporting

Management accountant also calculates the variance between actual accounting and budgeted figures and its report is provided to management.

3. Evaluation of Information

Information which is provided by financial accountant is not useful for management. Management accountant evaluates all these information with management accounting tools. After this, information becomes more useful for managers.

4. Administration of Corporate Tax

Management accountant is also responsible to pay all corporate tax to govt. For this, he collect the information of corporate earning, salary, property and sale and pays VAT, payroll tax, TDS, property tax and income tax.

5. Appraisal of Fiscal Policies effect

Fiscal policies can affect business externally because fiscal policies are made by govt. but it is the duty of management accountant to analyze these fiscal policies and manages business finance according to this. Suppose, govt. has increased the tax, then management accountant has to pay according to this and show the effect of future earning.

6. Protection of Assets

These days, you are reading the news of wikileaks on the different newspaper. This is the single media factor which may be useful or harmful for the security of your assets. Suppose, if wikileaks next target is banks, then as management accountant, you have to see how to protect the asset of your banking company after leakage of sensitive information of your bank.

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What Benefit can Hackers Take from Your Gmail Account Via Pushing Scam

What are Gmail Pushing Scams?

Recently, I got an email and it is asking password and other details of my Gmail account. After this, I discussed same question in GMail forum and its top contributor has given me some good suggestion which, here, I am discussing with you.

It's a phishing scam trying to steal your account.

Phishing scams include e-mails that request your login:password information, or links to fake web-sites that ask for your login:password. For web-sites, the printed link may look valid but the actual link could go someplace different.

You can ignore it, use the drop-down menu next to reply to "Report Phishing", or use the following form: http://mail.google.com/support/bin/request.py?contact_type=abuse_phishing 

What Benefit can Hackers  Take Via Pushing Scam?

The most common usage is to send spam to all your contacts.  Since they see the mail is from you they're more likely to open it.

Right after that comes sending a scam to all your contacts (for the same reason).  Usually the "lost in London" one.

After that comes other identity theft or looking at e-mail history to find other accounts to compromise.  If they can find their way to an eBay, Paypal, or similar they might be able to get some money.
Thanks dear  bkc56

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Interim Dividend Example

Recently, I opened the profile of the MNC and found the interim dividend declaration. Here, I am showing this declaration as the interim dividend example.

Our  Board of Directors  has declared  next Interim Dividend for the Financial Year 2010-11 of Rs. 15 per share of Re 10 each (face value). The dividend payout to the shareholders will be Rs. 700.0 Crores (Rs. 710.5 Crores inclusive of the dividend distribution tax) and will be paid on or about December 31, 2010 to those shareholders whose names are on the Register of Members of the Company as on December 15, 2010. The First Interim Dividend of Rs. 8 per share was paid in June 2010.

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Nature of Management Accounting

Nature of management accounting guides to know main characteristics of management accounting. Following are main points which shows the nature of management accounting:

1. No Fixed Norms Followed

In financial accounting, we follow different norms and rules for creating ledgers and other account books. But there is no need to follow fixed norms in management accounting. Management accounting tool may be different from one organization to other organization. Using of different tools of management accounting is fully dependent on the persons who are using it. So, business policy of each organization affects rules and regulation of applying management accounting.

2. Increase in Efficiency

It is the nature of management accounting that it is used for increasing in the efficiency of organization. It scans the points of inefficiency through analysis of accounting information. By taking action for improving, organization can increase the efficiency.

3. Supplies Information not Decisions

Management accountant supplies accounting facts and information and also provides interpretation, but decision making is fully dependent on higher authorities. Management accounting is just guide.

4. Concerned with Forecasting

It is the temperament of management accounting that it is fully concerned with forecasting. In management accounting, historical accounting information is analyzed through common size financial statement, ratio analysis, fund flow analysis and accounting data tendency for knowing the probability of next fact. So, all these things are especially useful for forecasting.

These forecasting may be related with following things

a) sales forecasting
b) production forecasting
c) earning forecasting
d) cost forecasting

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How to Get Accurate Profit and Loss Account

If you want to get accurate profit and loss account for your business, you need to pass correct journal entries. Wrong journal entries or any other error will also make incorrect profit and loss account. There may be also other problems which we have to solve, let's see practical problem of one of my student.

Problem

Sir I have taken a unsecured loan on 26-05-2010 and started my business.....but I have started recording my transaction on cash book by 1 dec 2010...I have lost track and forgotten that at what purpose or nature of work I have made the expenditure 1 lac rupees in my business needs....so, where should I write off that 1 lac rupees as what type of expenditure in cash book to get a accurate p/l account of my business?

Solution

1. First of all,  give pressure on your brain and try to remember for what expenses, you had paid 1 Lakh Rupees?
2. Check your all old vouchers, from where, you can find any clue of expenses.
3. See all the asset, it may be possible that you have bought any asset.
4. Ask your wife, I think, you may  give him as gift, then it will be drawing. No, need to show it in profit and loss account.

If you forget, it means, I think, you lost Rs. 1,00,000, then there is no need to show expenses in cash book and it should be written in the debit side of profit and loss account by you. In end, if you find correct expenses, then you can pass rectify entry. OK.

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Accounting Problem from Ryde, New South Wales, Australia

Problem

This is the query which came from Ryde, New South Wales, Australia. In this query, student has asked,  "In accounting, if company is running a loss, why give dividend?"

Solution

Dear Australian student,

                    In accounting books, you can not find this because if accounting statement shows loss, it will be against accounting principle to provide dividend. But sometime, if there is big amount of retaining profit (old profit which has not been distributed), then board of director can decide to give dividend out of retained reserve because when company suffers loss, at that time, shareholders of company feel very upset and start to sell the shares of company at very low prices, so, it is very necessary to bring confidence among them. This can only be by providing dividend even if company is running a loss. Ok.

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Accounting Education Site is Promoted in Google Search Engine

Today, I wrote accounting in google search engine and found my accounting education site second page after Wikipedia site in first page searching. Few month ago, it opened in third page searching. I think, this is promotion of my site and it is also gift of new year 2011 which has been given by google and its google webmaster indexing team. Thanks for this.

Coming in first page out of 135 Crores result of accounting is really award for me.

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Management Accounting Scope

Management Accounting Scope can be divided in following three parts

1. Analysis of Financial Statements Scope
2. Interpretation Scope
3. Decision Making Scope

Now we explain all above parts with more detail.

1. Analysis of Financial Statements/Accounting Data Scope

This part of management accounting scope answers our following questions

Q:- Which tools are being used for analyzing of accounting data?
Q:- Which specific accounting data is used for analyzing financial position, income position and solvency position?
Q:- What are main types of financial statement analysis?
Q:- What are the limitations of financial statement analysis?

2. Interpretation Scope

After analysis through ratio analysis, fund flow analysis, cash flow analysis or any other tool of management accounting, our next management accounting scope is interpretation scope. Analyzed data is also no tongue if you have no idea how to explain it? So, this is big scope for every wise man. Same analyzed financial statement's meaning may be different if interpretation is given by different account managers. For example, If we open the financial statement of twelve five years plan and we find that govt of India paid 1,10,000 Crores rupees for ending of poverty and you can find different detail of it. But if new account manager links it with no. of poor people, then we can see still 85% persons are poor. So, meaning of spending of Rs. 1,10,000 crores will become opposite. So, interpretation is important part of management accounting scope.

3. Decision Making Scope

"Who and how is the accounting information used for decision making?", is the part of scope of management accounting.

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Transfer Funds through SBI Online Banking

After activating sbi online banking, transfer of fund from one account to other account has become so much easy. Just few clicks, you can transfer your fund where you want to transfer.

I can explain it with example. Suppose, if you have a saving account with deposit of Rs. 10,00,000 in it. You have also another RD account in same State Bank of India's branch. You want to transfer Rs. 2000 to your RD account. Old way is,  just go to SBI branch and deposit the money but modern way is just login SBI Online account and select transfer and  then click Funds Transfer option in it. After this, select the account into which the amount is to be credited. Select the Payment Option * and then click on submit. Verify details and confirm this transaction  Debit Account Details.

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Report

Please forgiveness me for not connecting with you (all subscribers) due to mis-happening. Today, I am refresh and has started my professional work. Last time, I am discussing the MIS topics of Management Accounting. One of MIS's important topics  is Report. Today, we discuss about report in detail.

Q:- What is meant by a report?

Ans. In simple words, a report is that document which is used for communication of information. It includes investigated data.  In this report, we also include the tables which show the facts relating to any event, problem, progress of work, position of commercial business. In other words, a report is presentation of accounting facts which came from management accounting analysis. Report is important because it may be base of improvement in  actions.


Q:- What are the essentials of a good report?

Ans. Report is that vehicle which is used for communication the information to those people who are interested in that information. So, it is very necessary to make report in that way which fulfill the need of interested parties. Following are main essential elements of a good report

1. Simple

2. Good form

3. Purity of information

4. Comparative


Q:- What do you mean by enterprise reports?

Ans. This report is made for whole organisation. This report informs outsiders and communicates the progress of company. Income statement, balance sheet, income tax statement, employment report and report of chairperson are main examples of enterprise reports.

Q:- What are control reports?

Ans. Control reports show the variance of performance of responsibility centers and departmental managers. In these reports, we can see the actual and standard performance.  These reports must be sent at proper time, so that corrective measures can be taken by authorities.

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Speak Accounting Terms in Foreign Language

Are you interested to work of accounting in foreign country? I think to know English, is easy for you, if you are living in India. But if you are going for working of accounting in France, then how can you will speak accounting terms in french language? or it may be possible that any french accountant may be  interested to do accounting work in India. At that time, you can easily speak accounting terms in foreign language with the help of google translate service.

You use the free Google Translate service to instantly translate text from one language to another and in some language pairs, you may even listen to the translated text by clicking the blue speaker icon.

Here is the example and by listening  you can speak any accounting term in any foreign language.

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Typology of MIS

Main parts of Typology of MIS are given below:

1. Transaction Processing System (TPS):

TPS processes the transactions and produces reports. In business, it may be probable that 1000 transaction may be made. So, TPS automates this process. You see barcode scanner. With this, we can just scrutinize the code of product and sale entry without human intervention is recorded by computer system at any point of sale.

2. Decision Support System (DSS):

It is the system which is helpful for decision making. DSS is not just used in planning but with this we also analyze the information. Salary information system is MIS because it provides the information of different employees' salaries. But DSS provides advance information like in which scheme, the user gets more tax rebates. In DSS, there are different types of formulas which are useful for calculation of this.

3. Executive Support System (ESS):

ESS is used for specific requirement of manager at top level. For example, company needs advance information for knowing the personality of manager. At that time, ESS will be applied in organization.

4. Business Expert System (BES):

This system creates artificial intelligence of human being and suggests different decision for business.

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Structure of MIS

Structure of MIS shows total design of information flow for managerial decisions. It has three parts.

1st Part of Structure of MIS - Strategic Management Information System

It is top level top level of management where we require strategic MIS. At this level, manager has to make plan and policies. So, at this level, only that information is provided which are useful for making plan.

2nd Part of Structure of MIS - Simple Management Information System

At middle level of management, we require the information relating to increase the profit and decline the cost. So, MIS's best use is at middle level.

3rd Part of Structure of MIS - Operative Control through Information System

This is low level of management and at this level; we apply the structure of MIS for controlling operation.

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Characteristics of MIS

Main characteristics of management information system (MIS) are given below:

1. Integration

In MIS, whole system is integrated with each movement of business. It will be supportive to produce more positive information.

2. Central Database

It is also the characteristics of MIS that it has a central database. Only correct validation, anyone can access to information.

3. Software Based System

MIS is software base system which is used in management accounting. It needs continually updates. Moreover, software will process data automatically.

4. Flexibility

MIS is more flexible system than any other system of management. We can adjust input data and processing technique according to need of business and get information according to this. We can also divide MIS in sub systems for proper recording and process of data.

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