Interlocking and integrated System Difference

Interlocking and integrated System Difference

Under interlocking system a company maintains two set of accounts, such record is maintain to facilitate costing department for making different costing analyses, where in case of integrated accounting system only one set of account is maintained and same set used by finance and cost department.

1.    Resources & Cost

Interlocking system is more costly because two set of accounts are maintained. In fact such maintenance double the cost of book keeping .These cost include stationary cost, account department staff cost.

2.    Duplication of Work

In Interlocking system two set of record is maintained, and such maintenance requires duplicate records, such duplication can lead to many confusion within organization. It means interlocking system is more complex than integrated system.

3.    Analyses & Costing

Interlocking system was introduced to facilitate cost analyses and management support. Such system does not halt the financial reporting process. It means that interlocking system offer more detailed analyses of cost.

4.    Manual Concept

Interlocking system is manual book keeping concept and has no relevance in computerized environment, where integrated system is the only option. In computerized environment cost accountant and financial accountant can extract required reports.

5.    Complexity

Interlocking system is more complex in nature, because it is not easy to maintain and handle two set of accounts, where integrated system easy to manage & handle.