Financial Management Information System is a combination of both computer and human-based information system that collects, processes financial reports to give timely accurately and relevant reports for decision making at various levels of financial management.
The system uses formalised techniques to provide financial management at all levels in all function with correct information based on data from both internal and external sources to enable them to make on-time and effective decisions for financial planning, financial directing, financial control of the activities for which they are accountable.Enterprise Resource Planning is a business process management software which a business used in incorporating organisations departments and system to manage its resources and the business as a whole.
Business and organisations have invested in integrated financial resource planning. This has simplified the financial management of these businesses and these organisations and the government as well. With the combination of financial management information systems (FMIS) and Enterprise Resource Planning that automate and program important features of financial accounting operations.
The departments in different organisations create and form the Integrated Financial System systems by bringing together procedural and financial assistance, work out, and procurement to ensure it’s success through ensuring timely financial information that which financial managers and financial officers use in preparation of budgets, management of financial resources, and controlling financial programs.
This helps businesses and organisations efficiently take good control of business finances, improve financial transparency and responsibility, and thus helps to reduce business financial scam Financial information system pathways financial operations which it recaps inform of computerised financial information. In in almost all businesses, FMIS, is important in financial decision making, preparation of financial statements and financial reports such as income statements, the financial position of the business, and profit and loss statements of the business.
The structure of businesses and organisations, departments are multifaceted. Therefore they should design and adopt a good EPR and FMIS to help in effective Financial Management. Integration is very important in the operation of a Financial Management Information System. Financial integration, uses a joint data warehouse, making sure that each and unit and department, in addition, every handler follow the collective values, guidelines, and procedures.
This will help protect against unlawful use finances of the budget. Every User who is connected to the system in the integrated financial information system can access the data store in the system and can use it for the purpose for which they want for provided it is lawful within the organisation. Several financial reports get generated from the system; they include budgeting reports, reports on funding, treasury reports, and reports on cash flow, financial accounting, reports on internal audit, and daily financial management reports.
Integration of ERP and FMIS and its implementation has brought about significant changes in the tasks of the financial managers and financial accountants, improving the quality of every financial operation, which include; stock control, and raising the quality of financial information. The generated financial reports are also used in the management of planning of product, purchasing of parts, keeping and maintaining inventories track. The system can also be integrated with suppliers data base thereby improving suppliers confidence and keeping correct data about them; it’s also important in providing services to the customer, and keeping track of orders.
Financial Management Information System and ERP has integrated jointly in most business processes. Their joint ventures (ERP and FMIS) has seen essential reforms in the operating procedures of the business and different aspects of an organisation. This is evident in the way financial information flow information within the organisation. And in the manner in which the flow is conducted and in turn conveyed, the information is then appraised and used to make essential financial decisions.
The FMIS scheme, therefore, should, be led by comprehensive purposeful breakdown of the financial information that gives the description on the current useful processes, procedures, user outlines and requirements which are going to be supported in the system. It has been essential to trace and regulate outflows and expenditures of business finances budget and structure of accounts. Financial Management Information System usually incorporates real-time work to join budget arrangements and financial accounts. This raises standards of accounts classification.
The generated financial Information is used by different bodies like Finance Statistics and accounting standard bodies, which they after that use to provide significant financial reports. To the government bodies like the Ministry of finance and treasury. The integration of Financial Management information System and the Enterprise Recourse Planning has eased treasury operations.It has helped in tracking and merging of all government financial incomes into a one treasury account which is the Central Bank. The Treasury account is linked to other departmental accounts, from where all government transactions, payments records, and receipts are. The treasury department achieves financial resources at a central integration point, taking care of underused financial balances from other departmental units.
Financial Management Information System should be supported by an intelligible legal outline which governs the government’s finances. A legal guideline should exist, on the following financial issues; the responsibilities and functions of all financial institutions in management of finance, conveying Financial Information, governing, and watching budget through the integration of financial reports financial officers approve the laid down budget based on the availability of finances in the ERP; requirements of financial reporting; and, management of financial assets, public financial investment, and financial borrowing.
With ERP Financial Management Information System has been made simple and flexible for understanding by the user. This has eased understanding or the financial reports and information on the integrated. The information being simple has enabled businesses to handle more daily transactions so that the financial requirements are met. Financial Management Information System jointly with Enterprise Resource Planning as generally impacted positively on every business that uses the software with is integrated into the system.
This has been seen from diverse achievements ranging from generating timely, true and effective financial information and reports. It has also improved financial transparency and accountability and has also improved financial security since the system is more secure if well integrated