MIS or Management Information System is a computer-based system used by most organizations worldwide for transforming data into useful information for better decision-making. It helps management make better plans and carefully organize business operations.
Management information system is used for generating reports, including inventory status reports, financial statements, performance reports, etc. These reports are essential for analyzing different aspects of the business. They also help to answer 'what-if' questions like what would be the effect on cash flows of a company if the credit term is changed for its customers, etc.
MIS reports also support decision-making and help to integrate the decision-maker and the quantitative model being used. These automated systems allow managers to make decisions for the smooth and successful operation of businesses. The systems include computer resources, people, and procedures used in the modern business enterprise.
Types of Systems
- Accounting Management Information System: The system shares all accounting reports at different levels of management.
- Financial Management Information System: The system provides financial information to managers in an organization. Based on these reports, managers analyze historical and current financial activity and also project future financial needs. It is also used for monitoring and controlling the use of funds over time using the information developed by the MIS department.
Professional MIS reports are made by accounting firms for accurate analysis. These reports are comprehensive and help middle and top management make important decisions regarding finance, accounting, and overall business operations.