# Cost Accounting Systems — Introduction
To run business operations efficiently, a firm needs an appropriate accounting system to capture both its cost information and its financial information. How a company chooses to organise these two streams of records gives rise to two systems.
## The Two Systems
```
┌─ Cost Accounts ─┐
Company ──────┤ ├──► One of two systems
└─ Financial Accts ┘
```
| System | What it means |
|---|---|
| Integrated (Integral) Accounting System | Cost and financial accounting records are merged into one single set of books. |
| Non-Integrated Accounting System (a.k.a. Cost Control System / Cost Ledger Accounting System) | Cost and financial transactions are kept in separate sets of books. |
Cost records can be maintained under either method — they are alternatives, not a sequence.
## A Crucial Consequence of Keeping Them Separate
Under the Non-Integrated system, because costing and financial records are maintained independently, the two sets of books report two different profit figures. These two profits will not naturally agree, so they must be reconciled.
This single fact is why the chapter is built in three segments:
1. Non-Integrated Accounting System — separate cost ledger.
2. Integrated Accounting System — one combined set of books.
3. Reconciliation — needed only because the non-integrated system produces two profits.
## Key Takeaway
Integrated = one set of books, one profit, no reconciliation needed. Non-integrated = two sets of books, two profits, reconciliation required. Knowing which system is in use immediately tells you whether reconciliation is even relevant.