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What is Process Accounting?

H. Bliss
H. Bliss

Process accounting is a part of supply chain management and is essentially a system that helps a business owner design and monitor the progress of business process models. When operating within this type of system, the user designs custom process models to analyze, measure and track the performance of a company's groups, projects, or departments. Process accounting systems differ depending on their intended use, but generally have a variety of features. They are generally less expensive and more flexible than enterprise resource planning (ERP) systems, but require some knowledge and effort in designing processes suited for the organization.

When its features are used efficiently, process accounting can help a business process manager quickly and easily track and monitor things like finances, document progress, and work-flow automation systems to streamline processes that are performed frequently. Some programs help a user design processes to better handle tasks related to supplier accounts, like ordering and manufacturing tasks. Manufacturing tasks can include product design and fabrication, production, and marketing.

Man climbing a rope
Man climbing a rope

Part of process accounting can include security features designed to keep people on task by monitoring the resources they use. Some process accounting systems allow a process manager to examine qualities of in-process files to determine project progress. This means that a manager can look at how many documents an employee or team has completed within a project to determine whether they are on schedule. Monitoring features within this type of system can be an easy way to check up on the progress and quality of work for a group of workers. One disadvantage is that some employees are uncomfortable with the practice, and feel that checking files without their knowledge is akin to spying.

Spreadsheet programs can be a valuable tool in process accounting, and their benefits can come at a lower cost than business software systems. Businesses without the money to invest in process accounting software can enjoy some of the accounting functions within a standard spreadsheet program. Learning to use the accounting and equation functions within spreadsheet programs allows a user to design custom spreadsheets for tracking project progress and keeping track of project expenses. Some free, open-source spreadsheet programs offer considerable functionality for designing process forms.

Supply chain management is a means of managing a series of organizations that conduct business together. These types of businesses can include buyers, sellers, and raw materials suppliers that have relationships in business. Supply chain management focuses on supervising every step of the production process, including the raw materials, to ensure maximum consistency in the quality of the final product. Process accounting helps within supply chain management because it allows the user to design a framework upon which to operate and to measure success of the process under the framework.

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