Theory of Accounting Engineering: Reimaging Accounting in the Twenty-First Century for Everyone

By M.A. Khairy

From the beginning of accounting history in the fourteenth century to date, the updating of accounting took place to standardize accounting principles and create new standards and new sets of rules. There were no updates applied to the core of the financial accounting to add new enhancements and facilities to help grow and manage small business with cost-effective tools. The current accounting system delays the process of growing small business financially and administratively.

With the revolution of communication worldwide, small businesses have been growing tremendously; by applying simple ways of model engineering technology and computing science to restructure the existing accounting principles, it makes possible to create cost-effective tools and resources that put useful information at our fingertips. It reduces bookkeeping process, eliminates data redundancy, increases security levels, limits the need of third parties, and gets the necessary information to run and monitor business successfully.

Theory of Accounting Engineering: Reimaging Accounting in the Twenty-First Century for Everyone is for anyone interested in having a small business, either non-accountants or professional accountants, to manage business financials simply, easily without any sophistication.

• Language: English
• Publisher: Christian Faith Publishing, Inc.
• Release date: Sep 24, 2022
• ISBN: 9798885402255

Book preview

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Theory of Accounting Engineering

Reimaging Accounting in the Twenty-First Century for Everyone

M.A. Khairy

ISBN 979-8-88540-224-8 (paperback)

ISBN 979-8-88540-225-5 (digital)

Copyright © 2022 by M.A. Khairy

All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods without the prior written permission of the publisher. For permission requests, solicit the publisher via the address below.

Christian Faith Publishing

832 Park Avenue

Meadville, PA 16335

www.christianfaithpublishing.com

Printed in the United States of America

Table of Contents

Acknowledgments

Introduction

How to Read the Book?

The Book's Most Important Areas

Q1: Why Is Accounting Engineering Important for Nonaccountants, Professional Accountants, and Businesses?

Q2: What Is the Relationship between Model Engineering and Accounting and How Is It Built?

Q3: What Are Model Facts and the Power of Using Model Engineering?

Q4: What Is the Theory of Accounting Engineering?

Q5: How Does Model Engineering Present the Principle of Single and/or Double Financial Entries?

Q6: How Does Model Engineering Handle the Nature of a Financial Account?

Q7: Are the Outcomes from the Model Engineering the Same as Traditional Accounting?

Q8: How does the Model Engineering reflect on the standard accounting equation?

Q9: How Does Model Engineering Present Auto-Entry Transactions?

Q10: What Is the Meaning of a Model in More Details?

Q11: How Is the Trial Balance Generated?

Q12: How Do You Get the Daily Journal?

Q13: What Is the Meaning of a Method/Function and How Are They Working?

Q14: What Is the Necessary Method to Be Implemented?

Q15: How Does the Model Engineering Deal with the Financial Account Classification?

Q16: How Does Onetime Information Create a Full Balance between Models?

Q17: How Do Engineering Models Perform Posting Transactions to Their Target Accounts?

Q18: How Do Engineering Models Handle Security Levels within a Model and between Different Models?

Q19: How Does the Actual Implementation Look Like?

Q19.1: What Are the Most Important Methods, Functions, and/or Utilities that Should Be Available or Built-In during the Implementation?

Q20: How Is Chart of Accounts Replaced by Model Network Structure?

Study Case: Model Network and the Income Statement

Study Case: Income Statement Model and Projection Presentation

Study Case: Reconciliation Solution (Compare Model Method)

Q21: What Is the Major Difference between a Journal Model and a Traditional Accounting Journal?

Q22: What Are the Benefits of Creating Multiple Journal Models?

Q23: How to Use Journal Models with Different Scalars?

Q24: How Do You Generate the Cash Flow Statement?

Q25: How to Issue a Statement of Account for More Explanation to Q24?

Q26: How to Close the End of a Fiscal Year?

Q27: How Does Model Engineering Handle Budgeting for Planning and Control?

Q28: What Is the Meaning of the New Term Financial Tuning?

Q29: How Does Model Engineering Speed Up the Reconciliation Process?

Q30: Can I Combine Different Properties into One Property?

Q31: How Do You Manage the Opening Balance of Different Accounts?

Q32: How Many Methods Are Used to Issue Income Statements?

Q33: How Do You Create Properties?

SCCS: Study Case—Accounting-Engineering Models Can Be Applied to Different Control Systems

Q34: How to Group Different Properties?

Q35: What Are Model Engineering Recommendations to Build Different Model Inventory and Sales Invoice as Examples?

Q36: How Do You Explore the Existing Properties in the System?

Q37: How Do Different Models Handle the Exported Data from the Third-Party Software Application?

Q38: How Does Nesting of Different Properties Work?

Q39: How Does the Quick Reporting Facility Work?

Q40: How Do Transactions Build a Model?

Q41: What Is the Most Interesting Question to Demonstrate the Model Engineering Capabilities for Nonfinancial Figures?

Q42: How to Implement and Deploy the Performance Management Model?

Q43: How to Use the Command Mode to Get Employee's Evaluation Quick Results?

Q44: How Does the Posting Process of Property Attributes Work?

Q45: How Are Multiple Properties Reported?

Q46: Is It Essential to Work with a Database?

Q47: How Does Accounting Engineering Play an Important Role in Driving Goals for Business Process Reengineering (BPR) and Business Process Improvement (BPI)?

SCBS: Study Case—Small-Business Bakery Store

Q48: How Do You Post the POS Records and Identify the Inventory Items and the Cost of Sales?

Q49: How Do You Post the POS Records and Identify the Sales and the Cash or Bank Account?

Q50: How to Work with the Financial Bank Statement?

Q51: What Are General Logical and Technical Conclusions of the Theory of Accounting Engineering?

General Discussion

Appendix: Terms and Expressions

About the Author

Acknowledgments

With many thanks to Mr. President Justine Trudeau and his government for the incredible support to the small businesses in Canada and believing how the magnitude of small businesses impacts the local economy.

I would like to express my gratitude and appreciation to my brother Salah Khairy for his tremendous support and consultancy during the rising up of the idea and the writing process.

Special big thanks to my daughter, Miral, and my son, Mohanad, for their support and encouragement throughout the writing process.

My appreciation goes out to the administrative and editing team who are supporting and working to finalize and publish the book, especially Diane Giuffre and Alisha Johnson.

Introduction

From the beginning of accounting history in the fourteenth century to date, the updating of the accounting took place to standardize the accounting principles and create new standards and new sets of rules. There were no updates applied to the core of the financial accounting to add new enhancements and facilities to help grow and manage small business with cost-efficient tools. The current accounting system delays the process of growing small business financially and administratively.

With the revolution of communication worldwide, small businesses have been growing tremendously, and it has noticeable impact on the community and economy; by applying simple ways of model engineering technology and computing science to restructure the existing accounting principles, it makes possible to create cost-effective tools and resources that put useful information at our fingertips. It reduces bookkeeping process, eliminates data redundancy, increases security levels, limits the need of third parties, and gets the necessary information to run and monitor business successfully.

Applying model engineering, the double-entry transactions have been eliminated, data redundancy was reduced accordingly, and trial balance becomes not useful; it becomes just a periodic list of accounts.

The nature of the accounts is redefined by two timely operational definitions: the source and the destination; it is discussed later in the coming pages. All accounting processes were converted to standard model engineering; the chart of accounts is replaced by model building blocks. Practically a complete daily journal has been converted to daily journal model. The output information is easily