Integrated Accounting System

Posted by khuram on June 22, 2010

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Financial Accounting is basically Non-Integrated Accounting which accounts for only the monetary aspects of every business transaction. You purchase hundreds of inventory items but to record purchase, you only debit one “Purchase” Account with purchase value without any mention of quantities involved. Similarly you sell different trade items and record them by giving credit to only “Sales” Account. Consequently your Financial Accounts fail to tell you the complete story of your business affairs. You get a Trial Balance and Final Accounts. You know your Gross Profit and Net Profit. You also know financial worth of your business on the Balance Sheet date. The things you don’t know in this way are the details of your inventory items purchased/ sold, inventory stocks, inventory costs taken up in every sales transactions (Trading Businesses) or ongoing production activities (Manufacturing Businesses).

To overcome these limitations of Financial Accounting, large businesses usually adopt and implement another difficult and expensive Accounting System which is known as Cost and Management Accounting. This is also non-integrated accounting method because it functions parallel to the Financial Accounting. Small businesses end up in the maintenance of only some “Stock Registers”, in addition to the usual Financial Accounting. It means that under non-integrated accounting systems, Financial Accounting and Inventory/Cost Accounting books/ ledgers are separately maintained.

To explain an Integrated Accounting System, I here assume that reader already knows the usual procedure of recording transactions where entries are basically recorded in Cash Book and General Journal, then posted to Ledger, then summarized in the form of Trial Balance and then results are taken in the form of Final Accounts.

An Integrated Accounting System would be one where only a single set of books would contain all the information of Financial Accounting as well as Inventory/ Cost Accounting. Such a system would be very difficult to maintain if accounts are maintained manually. But most available Computerized Accounting Systems are Integrated Systems.

I take the example of an Integrated Accounting System (which I have developed myself by the name: “Soft Accounting System”) and explain how it’s functionality differs with Non-Integrated manual Accounting system.

Whereas in manual Financial Accounting, you enter Cash/Bank transactions in Cash Book and enter all other transactions in General Journal; in Soft Accounting System, you record Sale/Purchase transactions in Sale Invoice or Purchase Invoice. In the case of cash purchase/sale, that entry shall automatically be recorded in Cash Book. And in the case of credit purchase/sale, there will be no need to record it in General Journal. With a simple entry in sale or purchase invoice, you will not only get all the Financial Accounting Ledgers and Trial Balance, you will also automatically get your inventory and cost registers. If yours is a trading Business, then with a simple entry in sales invoice form, you will also automatically get Cost of that particular Sale calculated on the basis of both Weighted Average Costing and LIFO Costing methods.

If yours is a manufacturing business, then there is another simple Production Entry Form. You will enter in it only the basic ongoing production data but as a result, not only you will get detailed Production Reports, you will also get updated inventory registers of raw-materials and semi-finished items with a proper breakup of location/process where those semi-finished items have reached so far. When final production process on semi-finished items have been performed, then automatically those semi-finished items are removed from semi-finished inventory registers and go to Finished Goods Inventory Register. And when you will enter new sale invoice, then finished goods stock shall be automatically reduced from the Finished Goods Inventory Register. Not only this, you will also get detailed automated Direct Labor Payroll Reports. In addition, you will also get automated costing reports like Batch Cost Report and like etc. And since Soft Accounting System is an Integrated System, so you will also get automatically updated information in your Financial Accounting Ledgers and Trial Balance as well.

To record daily expenditure and transactions other than Sale/Purchase (or Sale/Purchase Returns – which are to be recorded in Debit/Credit Notes), there are also Cash Book and General Journal entry forms. So this is the way an Integrated Accounting System works.

Details about my self developed Integrated and Non-Integrated Accounting Software Applications ON THIS LINK.


Posted in -Home-, Accountancy and Computerized Accounting | 5 Comments »

Why Qualification is a Must for getting a Job…???

Posted by khuram on June 16, 2010

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Yesterday I google searched to see exactly why employers demand degree certificates from job applicants. One convincing argument that I found was that presence of degree/certificate gives enough surety that the applicant is determined … he has spend 24/25 years of his life in order to become a good employee. He is submissive and he shall obey the commands of employer. Employers don’t like that employees be able to “plan” the things by themselves. Employers tend to keep planning aspects in their own hands. They prefer and like their own plannings. They don’t really need employees competent enough to plan the things. They only need obedient people who have good track record of completing “assignments” in time.

Education system may be all good in terms of recognition in employment sector. But role of education system is not to spread knowledge. It’s role is to produce obedient people to meet the ongoing demands of employers.

Posted in -Home-, Education & Examination System, Pakistan, Philosophy, Theory of Knowledge | Leave a Comment »

Issue of larger brain size of Einstien:

Posted by khuram on July 20, 2009

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People believe in scientific myths that Einstien got some extraordinary brain:)

Was really E=mc2 anything new???

Not at all…!!!

We already knew K.E=1/2mv2

So, in a sense, there was nothing new in “energy-mass equivalence”.

“c” is only the so-called absolute form of “v”.

When talking in absolute terms (i.e. not in half terms where K.E is half of Total Energy), then we don’t need “1/2” in the equation of K.E.

We simply get “E=mc2”

It is said that this wonderful formula describes energy equivalent of mass at rest. Since value of c is so high so an ordinary mass at rest will be possessing huge quantity of energy. It is also said that this formula rightly predicted such things as Nuclear Bomb.

Whereas fact is that this formula only describes such an hypothetical situation where velocity “v” of a mass has reached to the standard maximum value i.e. “c”. So actually this formula has nothing to do with state of rest of mass.

It is so assumed that this formula describes energy equivalent of mass at rest because “c” has been considered a “universal constant”. Again, fact is that within the context of matter having mass, “c” is not any “universal constant”. “c” is just the standard maximum value of a “variable” which is velocity “v”. Despite official claims of Science, there are so many unofficial counter claims that speed of light “c” is not constant or even the maximum possible speed. But here we don’t need to go against official claims. Let us accept that speed of light may be constant and may it be the maximum possible value of “v”. But point is that even then “c” cannot be regarded as “universal constant” when talking in terms of matter and mass. Because after all then it is only a value of a variable “v”. So in this sense, if “c” is not a universal constant, it means that formula E=mc2 is not describing state of rest of mass. It is only describing an hypothetical situation where value of speed (i.e. a variable “v”) of certain mass has reached to the standard maximum value which is “c”. In this right context, actually formula E=mc2 is just worthless. It is only the case of such a K.E which, due to the mass having been reached to the maximum value of velocity (may be just hypothetically), has become Total Energy.

Nuclear Bomb was the result of later discoveries of hidden Nuclear forces and was not the result of this formula. Neither this formula has anything to do with those nuclear forces. It is the nature of Nuclear Structure of any atom which determines energy contents of that element. Mere “mass” does not determine it. If it were the case then Scientists should not have needed Uranium etc. because they could get mere mass from other common elements like iron etc. also, for making Nuclear Bomb.

“Professional scientists” are making us fool by saying Einstien had some extraordinary brain…!!!

Posted in -Home-, Philosophy, Philosophy in Pakistan, Philosophy of Science, Physics | 4 Comments »

What is the difference between Intellect and Rationality?

Posted by khuram on January 23, 2009

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Intellect is the name of an “ability”. Rationality is an “approach”.

Intellect is the ability of mind that it can store, manipulate, organize and suitably utilize past sensory information. Mind organizes sensory information due to the application of intellect. Knowledge is so organized information.

Rationality is an ideological approach whereby you show confidence in ability of human mind (intellect) that it can lead to truth. In other words, Rationality means using the faculty of intellect with confidence.

Posted in -Home-, Philosophy, Philosophy in Pakistan, Theory of Knowledge | 6 Comments »

Time – a mental construct or a physical reality?

Posted by khuram on January 5, 2009

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If we go deeper than our (actually my) understanding abilities, then we are at the level of an idealist. At this level, we are not confirmed whether material world really exists or not. Then we can theorize that time is just a mental construct.

But if we are not at this much level of depth, then we are at the level of a scientist who takes material world a reality.

At this level … time is not any physical thing. But however, time is the name of a physical phenomenon.

Physical events do occur before and after one another. Course of occurrence of physical events is a physical phenomena.

Some events are repetitive in nature and they occur at regular intervals. In normal conditions, regular interval between one kind of physical event can correspond to exact number of intervals between some other regular type physical event.

Time can only be measured by comparing the number of intervals of different regular type events.

Time is duration between events. Duration is measurable by comparing the number of intervals of different regular type events. And that physical duration is the time!

Posted in -Home-, Philosophy, Philosophy in Pakistan, Philosophy of Science, Space & Time | 5 Comments »

Society, Culture and Civilization. What they mean?

Posted by khuram on December 29, 2008

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If members of same species live together and facilitate each other’s lives by performing their specific role, then they constitute SOCIETY.

Not only humans, many animals also live in “societies”.

Term CULTURE should be specific to only human societies. Culture is the “material” and “immaterial” LOOKS of any human society.

Housing arrangements, types of buildings, roads and streets, means of communication, means of production of goods and services, level of technology, type of dressing, types of foods etc. etc. constitute the MATERIAL CULTURE of human societies.

On the other hand; language, idologies, beliefs, religion, customs, traditions, music, art etc. constitute IMMATERIAL CULTURE of human society.

Civilization means level of political and social organization of human society, level of ethical and moral standards of individuals of society; integrity, honesty and manners of individuals of that society etc.

Posted in -Home-, Human Mind Vs Animal Mind, Philosophy, Philosophy in Pakistan | 4 Comments »

What is Mind? What is its relationship with Brain?

Posted by khuram on November 13, 2008

“Mind” is an abstract term. Mind is not the name of any physical thing. Word “Mind” is different from word “Brain”. “Brain” is the name of a physical thing.

In most simple terms, Mind is sum total of knowledge, information, opinions and attitudes of a person. Mind is conscious of itself.

Relationship of mind and brain is that of software and hardware. But brain is not based on binary technology. Therefore nature of mind is different from the nature of computer softwares. For example, if most basic element in computer software is “data”, then most basic element of mind is not data … the most basic element of mind is “information” i.e. a “proposition”.

Mind gets basic input of “information”. Mind organizes this information in various styles. And the so “organized” information is the “knowledge”.

Posted in -Home-, Philosophy, Philosophy in Pakistan, Philosophy of Science, Theory of Knowledge | 7 Comments »

Can a deaf and blind person think?

Posted by khuram on October 23, 2008

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Humans have senses. And Humans have Mind. Senses do not “Think”. It is “Mind” who “Thinks”. Senses only “sense”.

Mind suitably and meaningfully “organizes” those “senses”.

Mind consciously reminds, reviews, recalls, reflects and analyzes that “organized stuff”. And this is the act of “Thinking”!

Mind can organize sensory data only in few possible styles. I will try to explain this point in my future posts.

In order that mind learns some standard language … it MUST be able to listen. Or it must have been familiar to listening experience, may be of just early life!

A born (totally) deaf and blind person can never learn any language.

And … a person devoid of all the senses canNOT “Think”!

Posted in -Home-, Philosophy, Theory of Knowledge | 6 Comments »

Do we get wisdom through success? or through failure?

Posted by khuram on October 15, 2008

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Failure and success both can give wisdom. Success takes you above … in skies … Your view ultimately broadens. You see things from above.

Failure may take you closer to your own self. You can better understand your own existence. Failure may take you to the depths. Your view deepens.

Not all people get wisdom though success or failure. Those who can get wisdom, get it from both failures and successes.

Posted in -Home-, Philosophy, Philosophy in Pakistan, Theory of Knowledge | 7 Comments »

“Space-Time Four Dimensions” Vs. “Time is Not Absolute”:

Posted by khuram on February 24, 2008

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“Space-Time Four Dimensions” Vs. “Time is Not Absolute”:

Relativity Theory is often linked with the idea of space-time four dimensions. Meaning of space-time four dimensions is quite simple however. Just like we refer to a “point” in “space” using THREE coordinate references, we refer to an “event” using FOUR coordinate references of “space-time”, where three are the coordinates of space and the fourth is the time coordinate.

So far this concept of four dimensional “space-time” is quite simple. Actual confusion comes when both Special and General Theories of Relativity assert that Time is not absolute. According to these theories, since there is no absolute time, so two observers can record different time durations of a single event, even if they employ exact same type watches for recording the time duration.

Actually, General Relativity Theory provides that Time can move faster or slower at different locations of Universe. Speed of Time, according to this theory (i.e. experimentally proven) is normal (means fastest) in complete empty space where there is no effect of any force of gravitation at all.

But at those spots of universe, which are in the range of considerable force of gravitation, time slows down at those locations.

Secondly, Special Theory of Relativity says that time slows down in an object if that object is moving at very high speed i.e. comparable to the speed of light (i.e. “time dilation”). These two assertions of General Theory and Special Theory of Relativity have been resulted in famous “End of Time” in Black Holes (General Theory) and “Twin Paradox” (Special Theory) sort of things. These assertions also have been resulted in confusions regarding the concept of space-time four dimensions. Since there is no absolute time and since time can be different at different spots of spatial universe, so there comes the confusion as if ”time” is some “physical” part of “space” and that as if “space” has physical four dimensions, due to which time can be different at different points of space. Purpose of this article is just to show that these two assertions of General Theory and Special Theory of Relativity that time can be different in (i) gravitational fields and in (ii) high speed objects, have nothing to do with the simple concept of space-time four dimensions.

Let us take the assertion that time slows down in gravitational field (General Theory). Out of this primary assertion (empirically proven), what can be logically deduced is just that Speed of time is the characteristic property of any particular point of three-dimensional space.

But since this speed of time can very for high speed objects as well (Special Theory) … so speed of time can be considered to be a characteristic property of speed of objects as well.

To conclude Four physical dimensions of space or even space-time, out of these two assertions of General Relativity and Special Relativity is a whole misleading and just confused idea. Very ironically, science literature discusses the concept of space-time four dimensions and another quite different fact that time is not absolute, in a way that gives the sense that these two are representing a single concept … that space or space-time has physical four dimensions.  

Idea that “Time” is the 4th dimension of “space” is Totally Absurd – PROOF

Let us first assume that science in fact says that “time” is the fourth dimension of “space”. Actually science doesn’t say exact this thing, but we can proceed in following way to prove that “time” cannot be the fourth dimension of “space”:

If “science” is talking about “space” … then it should talk about only and only space. It means, “science” should talk about complete empty space.[Also see my article: Space as a form of ‘Nothingness’]

In a complete empty space … where there is no “matter” at all … Time cannot even exist in such complete empty space.

What is Time…???

Concept of time comes out of movement of material objects. Movement of material objects generates events.

What is Time…???

Time is actually the DURATION between those EVENTS.

In a complete empty space >>> there shall be no material objects >>> With no material objects >>> there shall be no movement of material objects >>> with no movement >>> there shall be no EVENTS >>> with no events >>> there shall be no DURATION between EVENTS >>> Means No Time at all…!!!

Time does not exist in empty space. So the idea that “time” is 4th dimension of space is Totally Absurd.

And as I have explained that Time does not exist in empty space. Here I want to add something to it.

The concept of time is wholly dependent on the movement of physical objects. Time does not reside in “space”. Time is there inside of physical objects. Because physical objects always remain in the state of motion. It is only and only physical objects and their mutual interactions that give us the “idea” of time. What has been empirically verified is just that movement of same nature “events” slows down with increase in the strength of Gravitational field. Gravitational field is Not the characteristic property of space itself. Gravitational field is the characteristic property of massive material objects in fact. Events occur only and only in material objects … Duration between events also has to do only with material objects … Slowing down of those events is also because of “mutual interactions” of those material objects.

Time, so, resides only in the “behavior” of “physical objects”. Time does not slow down because of some property of space itself. Time slows down only due to “mutual interactions” of material objects. Let’s at point ‘T’ of empty space, speed of time is ‘a’. Now we bring a massive material object near the point ‘T’. Now speed of time at point ‘T’ shall be slowed down because now this point would be within the range of a gravitational field. This slowing down of time has not happened due to any property of “space” whatsoever. It has happened just due to mutual interaction, or type of movement (in case of slowing down of time in high speed objects) of material objects.

Time has nothing to do with Space…!!!

Space has only three dimensions. We use three dimensions of space to locate a “point” in three dimensional space.

But we use four dimensions of “space-time” just with the view to locate an “event” in four dimensional space-time.

This simple idea of space-time four dimensions is not the direct or indirect result of the complicated idea of Theories of Relativity that time is not absolute and that time can be different in gravitational fields (General Relativity) or in high speed objects (Special Relativity).

But the fact that there is no absolute time in this universe does have its implication on the “structure” of space-time coordinates. In most simple words, the “time coordinate” of four dimensional “space-time” can be thought of having an “irregular scale”. Let us talk in terms of two different frames of references of two observers A and B. Observer A is stationary in space and is not subjected to varying strengths of surrounding gravitational fields (Suppose he is stationary in complete empty space outside the influence of any gravitational field). Observer B is moving in space with velocity v. As observer B is moving, he sometime moves from complete empty space and sometime goes through the fields of gravitation because of the presence of nearby massive bodies.

In this case, time coordinate scale of observer A has to be perfectly regular. Means his every second will be having a constant duration. But time coordinate scale of observer B will be irregular. Whenever he will pass by gravitational fields, the duration of his “seconds” will become greater because his time will slow down within the range of gravitational fields. He himself may not be able to take notice of irregularities of his time scale. But observer A will be able to take notice of irregularities of time scale of observer B. Suppose originally both observers kept exact same type watches. In the end, when observer B shall come to the location of observer A, then both observers’ clocks will show different passage of time. Observer B’s clock will show lesser passage of time than observer A’s clock because observer B was subjected to slowing down of his time at different spots of his journey. Observer B was also subjected to slowing down of his time because of his own velocity v.

It has been mentioned above that “irregularity” of the scale of time coordinate of observer B can be noticeable to only observer A. It is due to the fact that as clock of observer B becomes slow, so his all other movements in space also have to slow down. Meaning of slowing down of time is not confined to just slowing down of clock. Its complete meanings include slowing down of all the movements and events, including slowing down of clock and even “feeling” of passage of time as well as biological aging process, with same ratio. As every kind of movement in space has been slowed down, therefore for observer B, his distance traveled in space per unit time shall NOT be affected; because for him, his clock and his movement in space has been slowed down with exact same ratio. It means that observer B shall not be able to realize any decrease (or increase) in his “velocity” in space as a result of slowing down of his time.

Let us now talk only in terms of “time dilation” due to high velocity of observer B in space (i.e. Special Relativity). Suppose initially both observers A and B were at same location in space. Then observer B starts his journey in space at very high velocity i.e comparable to the speed of light. Suppose his destination was located at the distance of exact one hour with that much high velocity. Observer B has to reach his destination and has to come back at original location. For observer A, observer B should come back in exact two hours.

Now let us see what will happen due to the irregularity of the scale of time coordinate of observer B. As observer B will acquire high velocity, his time will be slowed down with reference to the time of observer A. Not only the clock of observer B, but his movement in space per unit time of observer A will also be slowed down. But as his movement in space will be slowed down in exact same ratio of his own clock timing, so neither observer B will be able to take notice of slowing down of his clock timing, nor he will be able to take notice of slowing down of his movement in space.  For him, he is still moving at the velocity that will take exact one hour to reach at the destination. In this way, he shall reach to the destination and will come back to original location in exact two hours.

But in the same “time”, observer A’s clock will show passage of far more time … may be 10 hours, 10 days, 10 years or like, depending on the velocity acquired by observer B. 

This is exactly what “Twin Paradox” tries to highlight. That there were two twin young brothers. One brother started journey in space at very high velocity. After few minutes when he came back, he saw that his twin brother was then an aged person!

Net result of this article is that space-time four dimensions is basically a simple concept. Idea of no absolute time does not mean that time is a “physical” dimension of space. Idea of no absolute time has the implication however that it suggests irregular scale of the time coordinate for an observer who is moving in four dimensional space-time with velocity v and/ or becomes subject to varying strengths of surrounding gravitational fields.

At the end, it is also important to point out that modern Physics also suggests more than three dimensions of “space” alone. It is said that higher dimensions of space are not perceivable to us because they reveal themselves only at particle levels and at very high energy states like in particle accelerators etc. Modern speculative theories like Strings Theory and M-Theory etc. have tried to construct models of universe in terms of higher than three dimensions of space.

Posted in -Home-, Philosophy, Philosophy in Pakistan, Philosophy of Science, Space & Time | 18 Comments »