SIS – Accounting System Literature Review

Posted on March 30, 2018 by Cheapest Assignment

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Strategic Information System (SIS)

Accounting System at Aldi Supermarket

Literature Review: Coles Supermarkets

Background

Coles Supermarkets Australia Pty Ltd. which is trading as Coles is a supermarket chain based out of Australia and is established by Wesfarmers. It was founded in the year 1914 by George Coles in Collingwood, Melbourne. Currently, Coles Supermarkets has 800 supermarkets in operation which also includes several re-branded BI-LO Supermarkets. The strength of Coles is around 100,000 employees. If we consider both Coles and its biggest competitor in this industry in Australia which is Woolworths then they both account for 80% of the total Australian Market. The company also has a presence online in the name of Coles Online.

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PART 1

Organization structure

The role of organization structure is quite important in a company which helps in providing a positive influence on the performance level and overall attitude of employees working in that particular organization. It also helps in understanding the way work has been allocated to the company along with authority and ways to its proper organization. There are different types of organization structures namely flat, vertical, matrix, functional and line exists in the operations. The selection of an organizational structure is done by keeping in mind the size and complexity of the business.

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Challenges in Managing Global Team

The Coles Supermarkets have grown their business to several differentiated products in their portfolio and therefore there is a requirement to organize all of their activities and offerings in a systematic manner. Coles has adopted a divisional organization structure and the reason behind this is that it helps in gaining a precision of all their operations by dividing their large business units into small groups. This type of organization structure helps the organization in having a narrower approach towards their business units for the purpose of focusing on the identical units.

Operational problems at Coles Supermarkets

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All the Australian based outlets in the name of Cole Supermarkets operate their products and service separately for the purpose of their business and customers as well. Suppliers are very important part of their supply chain. One of the biggest issue faced by Coles is that their suppliers are not working efficiently as they are not able to fulfill seasonal needs of customers on time. Coles also has high attrition rate which is above the industry standard. This is leading to a situation of manpower shortage and also hampering some of their activities already. This is a very big issue on weekends as the volume of customer increases. The impact of this also hampers the performance of warehouses which plays an intermediate role between suppliers and the company. So the two main issue which Coles is facing right now are problems with their logistics system and supply chain system and they need to work on these in order to improve their efficiency.

Commercial software for accounting

The accounting software used by Coles is an enterprise resource planning system which is a product by Microsoft. It is called as Microsoft Dynamics NAV. It is a very exhaustive accounting system as it contains almost all the features that a company can need. The basic purpose of using ERP software is to provide an integration among all the departments of the company such as Human resource department, Sales department etc. Another feature that it has is of customization where customers can customize features of products as per their wants and needs. The support is provided at both online as well as offline level. In addition to these features, it also supports the purchasing team in the procedure of preparing a copy of all the requirements which later gets distributed in all the company warehouse and logistics teams. This is quite helpful in establishing a coordination among all warehouse teams and the suppliers.

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System Flowchart of the Sales procedure

Coles operates through two platforms: physical outlets and online platform. If we talk about the physical presence then all their outlets are placed strategically so that customers can have access to their stores quite easily. The sale of products offered by them happens in two ways. First one happens at the physical store where customers select their desired products by paying a visit to the store and billing it at the counter which would require scanning of products selected by the customer. Another way through which sales happen is by online shopping where company list all their products with their respective prices on the online website and then customers buy products by paying online.

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Control problems and possible fraud

The frauds which are identified with a market can be performed by either their employees or the clients. If there should arise an occurrence of workers, it could be a clerk, chief or here and there staff individuals as well. The clients additionally utilize different fake approaches to steal something from stores like for instance evacuating the standardized identification of the stolen item with the goal that it can’t be recognized by the bar scanner. Clients can likewise restore that stolen merchandise to the store and charge the store full measure of the item for the item being blemished. A portion of the measure which could be utilized by the stores to stop these exercises is establishment of CCTV cameras and scanner tag staying with the end goal of checking every one of the merchandise. Representatives can likewise assume a vital part in relieving the danger of stolen merchandise by counting the offers of products and money accumulation by the day’s end.

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PART 2

Development and Adoption

Nowadays, customers need some accounting software in order to fulfill their financial and accounting needs and QuickBooks is one of them. This software was developed by Intuit Inc. and the inspiration of developing this software came from the successful market presence of Quicken which its initial version in the business of individual accounting software which was also developed by Intuit Inc. the reason behind development of QuickBooks by the organization was to bridge the gap between current market demand and expectations and limitations of the first version, Quickens.

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In the year 2007, the launch of the pro version took place and soon became very popular all over the world due to it being quite user-friendly in small as well as bigger organizations. The subscribers for this software grew up to 625,000 in the year 2014 which was the highest by then. This software gets the support from all the operating systems. The services provided by it are the calculation of taxes, cash inflow, and outflow management system, tallying the cash and credit transactions.

Current market size

The current Australian accounting software industry is about $1 billion. They have so many players in the market and top three of them are MYBO, Intuit and XERO. They fight among themselves in order to gain the dominance over each other. The development of XERO has been done by the organization which is based out of New Zealand with a customer base of around 4 Lacs customers from all over the world. Their total revenue is $250 billion approx. in transactions. If we compare both the software then Intuit would have precedence over competitors as it is a quite older organization. It is known for the previous version, QuickBooks in all parts of the world. The market share of this company in Australia is around 33% where MYBO is considered to be the market leader. The valuation of MYBO is between $A 2.38 to $A2.72 in the market. Although, Intuit is a five year old organization, still it has 33% of the total market area. This is quite good for their future and intentionally recognized products and organizations.

Market leader

XERO has the leading position in the market of Australia as it has a large variety of products with different features. This provides them with an additional advantage in the market of Australia. The number of subscribers are almost double for XERO than for MYBO which are almost five hundred. If we talk about the revenue figures then, current revenue for MYBO is 13% and XERO has more than double of it which is almost 40%. Recently, QuickBooks can be considered as the biggest competition of XERO which is due to the fact that XERO has very easy to features. This product is getting popular day by day due to its features.

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Some of the features of XERO which usually attracts customers are that it provides cloud based facilities to their customers in addition to the well maintained eco-system which requires a third party integration. The whole idea helps in establishing a fast transaction between the bank and organization which saves both time and cost at the same time. Another feature could be that all the products from XERO supports online transaction and payment can also be done online. Collaboration of invoices from different vendors can also be done in order to send to customer for payment purpose in a collective manner. Now, QuickBooks from Intuit is as competent product as XERO but because it is still very new in the Australian market. It fails to grab the attention of customers in that market. Due to high competition and new players, market conditions have become tough and MYBO has started losing to other competitors.

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Gap and Challenges

There are some gaps present in the actual performance and the expectations that customers have from QuickBooks. One of those gaps are the unscheduled outages which happens on daily basis. Its impact is on whole software which has led to downtime resulting in reduced usage. QuickBooks has a feature where a particular assigned team gets all the IT related issue from this software. Another gap encountered with QuickBooks is that they have developed it such that it is very user friendly and due to which it does not perform some of the more complex accounting methodologies. Here, accountants need to analyze the whole data on their own without any software help. Therefore, this software is suitable for the requirements of small accountants and small nosiness customers as per their size in the market.

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Recommendation and suggestion

The biggest strength of QuickBooks is that they provide customized products to their customers which given them a competitive edge over others. Although, the overall packaging of QuickBooks attracts the customers but it is high time, they should keep customer satisfaction as their focal point in order to be completive in the Australian market. The current focus of this software is to sell products online and improve their market share but it is advised to shift the focus to desktop products. This is because there are high chances that this would improve its productivity and popularity among its customers and also would attract more customers in the market. The only hurdle for this software is limited capability of accounting which they should work upon.

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Conclusion

Organization structure of any entity includes identification of roles and responsibilities of all the employees in that particular organization which is helpful in delegation of work and authority as per the designation and position. All the operational issues are due to the fact that people have not been assigned to right function and to the correct person. This helps in implementation of a complete solution for getting a hold on the current situation. Some of the other advantages of having an accounting system are less time delays, higher cost efficiency and effective analysis procedures for analyzing the accounting books. This helps in understanding the financial position of the organization in an accurate manner.

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References

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