Advantages

• Accuracy - transactions can be entered on a more accurate basis as usually only one entry per transaction, eliminating errors of only recording one side of the double entry system
• Legibility - figures are typed and therefore more legible to avoid the wrong figures being read
• Speed - it is far quicker to enter transactions on a computer than to manually record them in the written ledgers
• What-if? calculations - figures can be altered to show the business the effects certain changes will have on their profitability and liquidity. Especially useful in cash budget.
• Documents can be quickly prepared, for example invoices and statement of accounts, as debtor’s information will be stored on the computer. Payslips can also be quickly and efficiently issued.
• Work can quickly be shared between different members of the business through the software.

Disadvantages

• Cost - high installation costs and then the costs of updates and additional software which will be a recurring expense to the business.
• Disruption during time of installation - work may be disrupted when they are initially installed, resulting in reduced sales and unhappy workers.
• Files may be lost if a regular back up is not kept in the event of a system failure.
• Computer hackers may be able to gain access to information, threatening the security of the business.
• Employees may dislike computers and may be worried of bad backs and RSI.
• Having to train the employees to use the computers may cost money and time.
• Still the danger of errors as errors of omission, commission, original entry and principle will not be revealed.

Advantages to employees

• Being trained to use the computers would improve their future employment prospects or increase wages.
• Motivated to learn new skills.
• They will be able to work quicker and get more work done in the same amount of time.

Disadvantages to employees

• They may dislike computers and favour the traditional way of doing their job.
• Communication within the office between employees may be restricted as they are sat at a desk all day.
• Health risks such as eye strain and RSI.
• May fear redundancies as less people will be required to do the same amount of work as they did before now they have computers.