Types of Files:

Master file is of permanent nature (like customer ledger, payroll, chart of accounts, etc.) and contain both data of a static nature (like customer name, address) and the data, which will change each time a transaction occurs (like balance, quantity, rate etc.). Master files are updated regularly to show a current position.

Movement of transaction file is made up of various transactions created from the source documents. This file is used to update master file.

Reference files or index files is a file containing reference data, which is normally altered, updated rarely. It contains no transaction data. Thus it is a file with a reason able amount of permanency, (like pricelist, manuals of company procedures. stores list, voucher types, etc.).

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