Difference between Integrated and Interlocking system

Difference between Integrated and Interlocking system

Integrated and interlocking system is two cost book keeping methods. Interlocking system maintains two set of ledger which allows detail analyses of costs and cost related processes. Integrated system keeps only one set of ledgers and both financial and cost accounting information needs are met from the same books.

1. Duplication of record

In Integrated system there is no duplication of record due to single set of ledgers where in interlocking system there is duplication of record due to two set of ledgers.

2. Cost

Interlocking system require more resources than integrated system. More time is required to maintain the interlocking system similarly interlocking system requires more human effort than integrated system. More resources require more cost therefore interlocking system is deemed to be more costly than integrated system.

3. Detailed analyses

Interlocking system allows more detail analyses of cost and other cost related process. These analyses can be performed without any difficulty and delay due to separate set of ledger.

4. Avoid confusion

Interlocking system creates much confusion due to two set of ledger and too much information is being produced from different record and therefore the information management is more difficult in interlocking system. In integrated system this confusion can be avoided.

5. Computerized environment

Integrated system is the only system followed in computerized environment and detail cost analyses are controlled through coding system (Charts of accounts). Interlocking system has no relevance in the computerized system.