Tailored Software or Tailor-Made Software

Tailored or Tailor-made accounting software is the software that is developed as per the specifications and requirements of the users. This accounting software is generally used in large business organizations with multi-users and geographically scattered locations. It is designed to meet the specific needs of the users and forms an integral part of the organizational MIS. It has an infinite number of users.

Advantages of Customised and Tailored Accounting Software

The following are the advantages of Customised and Tailor-made Accounting Software.

  • This software is suitable for medium and large business organizations.
  • It caters to the specific requirements and needs of the users.
  • It can be modified as per the needs of the organization.
  • It has a high level of security and minimizes the risk of loss of data and unauthorized access to data.
  • It cannot be easily imitated or duplicated in the market due to differences in the needs and requirements of different users.
  • It does not involve a high cost of training as the training can be imparted within the organization by experienced personnel.
  • It can be easily linked to other information systems.
  • It forms an integral part of the organizational MIS.

Disadvantages of Customised and Tailored Accounting Software

The following are the disadvantages of Customised and Tailor-made Accounting Software.

  • It involves the high cost of installation and maintenance.
  • Developing customized software is a time-consuming process and involves a high cost of development.
  • Maintenance of this software is difficult as there exists limited availability of knowledge with the developers.
  • It lacks a standard training module.

Also, Read

Interest on Capital

Any interest paid on capital is considered as an expense and is shown in the Profit and Loss Account. Treatment of interest on capital in the final accounts is as follows.

Interest on Drawings

Treatment of interest on drawings in the final accounts is as follows. Firstly, interest in drawings is shown on the credit side of the Profit and Loss Account.

What is Operating Profit?

Operating Profit can be defined as the profit earned by carrying the normal business activities. It is computed by subtracting the operating expenses from the gross profit.

Balance Sheet

The balance sheet is the last financial statement that is prepared by any organization. This statement helps to ascertain the true financial position of an enterprise at the end of an accounting period

Profit and Loss Account

A profit and Loss Account is the second financial statement prepared by an organization. This account is prepared to ascertain the net results of a firm in form of net profit earned or net loss incurred during an accounting period.

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