Processing of transactions may be done either in batches or in real-time.
Batch processing of transactions (e.g. purchase invoices) may take place either at predetermined intervals such as daily or weekly or when a predetermined number of transactions are ready to be processed, for example 25 invoices.
In such a system, there is clearly a delay between the point at which a transaction occurs and the point at which processing of the transaction takes place. This means that accounting information available may not be up-to-date or complete as transactions may have taken place but not processed.
Batch processing of transactions is primarily associated with manual accounting systems and processes.
Real-time processing of transactions relates to computerised systems whereby processing of transactions is immediate. As soon as a transaction has occurred, the accounting system is updated.
Integrated computerised accounting systems will update all aspects of the accounting records and broader management information system as a transaction is processed. For example, as a sale to a credit customer has occurred, the accounting system is updated, and there will be simultaneous update of the individual customer account records.
This has the advantage that users of the accounting system and the information it generates will have access to the most up-to-date information available. This helps accounting staff and others employed in the business to make appropriate decisions to control and manage the business.
Note that the ACCA FA1 syllabus and exam assumes that businesses will be using an integrated computerised accounting system and no knowledge of any particular computerised accounting packages is assumed or required. The focus of the syllabus and exam is upon the processing of accounting transactions.