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ACCA Performance Management > Chapter 2: Management Information Systems > Flashcards

Chapter 2: Management Information Systems Flashcards

1
Q

Definition of data

A

Raw & unprocessed format
Recorded but not yet processed in a way suitable to make decisions
Sits with IT concerned with storage & security

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2
Q

Definition of information

A

Processed data in a way which has meaning to the person who receives it.
This person can use it to improve the quality of their decisions

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3
Q

What does management require information?

A

1) provide current & historical records
2) Analyse what is happening to the business
3) Basis on decision making in ST &LT
4) Monitor the performance to compare actuals and forecasts

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4
Q

What 3rd parties would be interested in info about the business

A

Owners/ shareholders
Customers & suppliers
Employee
Gov agencies e.g tax

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5
Q

What are the characteristics of good information?

A

ACCURATE
Accurate
Complete
Cost-effective
Understandable
Relevant
Accessible or authoritative
Timely
Easy to use

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6
Q

What is meant by complete info

A

Managers should have all info needed but not an excessive amount

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7
Q

What is meant by cost- effective info

A

Value of info should exceed cost of producing it

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8
Q

What is meant by understandable info

A

Info is clearly presented & displayed

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9
Q

What is meant by timely info

A

Info should be provided in sufficient time for decisions to be made

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10
Q

What is data processing

A

Converting data to info e.g classifying/ sorting/ producing
Can be automated or manual

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11
Q

How can data transformed

A

summarising data/ basic processing/ statistical and financial analysis/ tubulation

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12
Q

What is information technology (IT)?

A

Hardware needed for capture, storage, transmission or presentation of info

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13
Q

What are Information Systems (IS)?

A

Management of systems to support running the business
Needs ready access to necessary data –> discard what’s not needed
Bespoke to company so expensive
Needs to add value where it’s cost-effective

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14
Q

What do Information systems do?

A

Links organisations to customers & suppliers
effective integration to use info for value-adding process
Orgs can develop/ produce/ market & deliver new products or services based on info
Senior management help to develop and implement strategy
E.g tesco club card

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15
Q

What are the 2 main roles of Information systems

A

1) Support operations via processing & storing transactions
2) Support managerial activities e.g decision making, planning, performance measurement & control

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16
Q

What do organisations use information for?

A

1) Record transactions
2) Make decisions
3) Planning
4) performance measurement
5) control

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17
Q

Why do you need to record transactions

A

1) evidence in disputes
2) legal requirement
3) Build a profile to assess profitability

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18
Q

Why is information used for planning

A

Availability of resources
Possible timescales etc

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19
Q

What is performance measurement

A

Enables comparisons of actuals vs budget/ plan
collection of info on costs & profitability
analysis & presentation performed by IS

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20
Q

What is control

A

Show whether a plan is proceeding as expected / unexpected deviations
IS can monitor project outcomes

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21
Q

How to assess costs of an IS

A

Cost- Benefit Analysis (CBA)
shows expected losses vs benefits
refined systems= expensive
Skilled staff need for operation= expensive

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22
Q

What are the initial costs of an IS

A

1) design & develop if bespoke
2) purchasing software if not bespoke
3) purchasing new hardware
4) Cost of testing & implementing
5) training cost

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23
Q

What are the running costs of IS?

A

1) labour time to run system
2) material cost e.g replacement parts
3) cost of service support
4) Ongoing training costs

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24
Q

What are costs of internal info?

A

1) direct data capture (barcode scanners)
2) Processing costs ( payroll salaries)
3) Indirect costs (info which isn’t needed/ duplicated)

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25
Q

What are costs of external info?

A

1)Direct costs (subscriptions)
2) Indirect costs (wastage time finding useful info)
3) Management costs (processing info)
4) Infrastructure costs (systems enabling internet searches)

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26
Q

What are the benefits of a new IS?

A

Enhanced efficiency & capacity
better quality information
Better access to info
Improved sharing of info
Improved communication
Better decision making and customer service

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27
Q

What is a LAN & WAN?

A

LAN= Local area network
can share data and to devices e.g printers & emails

WAN= Wide area network
Connects LANS so computers in different locations can connect

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28
Q

What does a network do

A

Facilitates the transfer of information between different parts of the business

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29
Q

What is the intranet

A

Internal network used to share info in organisations with employees
Firewall fends off unauthorised access

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30
Q

Benefits of the intranet

A

Eliminates storage, printing & distribution of documents
More widely used than files in drawers–> improves productivity & efficiency
Easier to update information

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31
Q

What is cloud computing

A

Access different services via the internet
Data is stored, managed and processed with remote servers for on-demand access

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32
Q

What are some benefits of cloud computing

A

1)Lower maintenance costs (don’t need physical space & everything done by a 3rd party). Only pay for what’s used and accessed anywher

2) Data easily backed up & updated in real time –> flexible and accurate financial reporting. More efficient than legacy systems

3) Security -service provider pays to fix problems & upgrade so don’t need to pay extra for this

4) Agility- work across the globe on same project at same time

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33
Q

What is the extranet

A

Collaborative network
Extension to intranet connecting the business to shareholders/ suppliers etc

34
Q

What is the internet

A

Interconnected networks/ computers carry info & resources connect via an IP (Internet Protocol) address
Share data quickly
Opens up to viruses & hackers

35
Q

What is wifi?

A

Wireless Fidelity
Mobile use of laptops & handheld devices

Used to buy products- firms create apps- makes purchasing quicker

Used to access key info e.g in hospital wards

36
Q

What are the 2 types of control?

A

General controls
Application/ program controls

37
Q

What are General controls

A

Overall control of IS

Physical control- preventing physical access to hardware e.g locks/ alarms/ cctv

Personnel control- segregating duties/ hierarchy of access/ training/ supervision

Access controls - passwords/ time outs

Computer equipment controls - prevent from destruction/ damage/ theft

Business continuity planning- risk assessing what is critical to the business

38
Q

What is application/ program controls

A

Automatically performed by the system

Completeness- all data is processed
Validity- only valid data is input
Identification- Users are identified & authorised
Problem management facilities- recorded problems timely

39
Q

What are the solutions to the threat of natural disasters?

A

1) Fire procedures- alarms/ extinguishers/ doors/ training/ insurance

2) Location- not in a place liable to disasters

3) Physical environment- air con/ dust control

4) Back up procedures - regular basis for recovery

40
Q

What are the solutions to the threat of a malfunction?

A

1) Network design - cope with periods of high volumes
2) Back up procedures

41
Q

What are the solutions to the threat of a Viruses?

A

1) Anti-virus software (updated regularly to prevent corruption)
2) Formal security policy & procedures
3) Regular audits to check for unauthorised software

42
Q

What is a virus

A

Small program that once introduced to the system spreads extensively
Can affect the whole system

43
Q

What are the solutions to the threat of a hackers?

A

1) Firewall software- protection from unauthorised access to the system from the internet
2) Passwords/ usernames- Limits unauthorised access to the system
3) Formal security policy & procedures- when using personal devices at work there should be a policy to prevent hackers
4 ) User awareness training of risks should be available
5) Data encryption - scrambled prior to transmission. Recovered in a readable format once transmission is complete

44
Q

What are the solutions to the threat of a Electronic eavesdropping?

A

1) Data encryption
2) Passwords/ Usernames

45
Q

What is hacking?

A

Deliberate access to systems by unauthorised persons

46
Q

What are the solutions to the threat of a human errors?

A

Training & operating procedures

47
Q

Definition of human errors

A

unintentional errors from using computer & networks

48
Q

What are the solutions to the threat of a human resource risk?

A

Ergonomic design of workstations- reduces problems such as RSI
Anti-glare screens to reduce eye strain
Cables in ducts

49
Q

What is human resource risk

A

Repetitive strain injury (RSI), headaches and eye strain from computer screens, tripping over loose wires

50
Q

What is wikileaks

A

Not-for-profit org
protects whistleblowers & journalists with sensitive info to communicate to public

51
Q

What is an input control & an example?

A

Inputs should be complete, accurate & authorised
Passwords

52
Q

What is a processing control & an example?

A

Should be initiated by appropriate personnel & logs kept of any processing
Audit trails

53
Q

What is an output control & an example?

A

Should be available to authorised persons & 3rd parties only
Distribution lists

54
Q

What are the 7 different controls over input

A

IFRSCCM
1) Input
2)Format checks
3) Range tests
4) Sequence checks
5) Check digits
6) Control totals
7) Matching

55
Q

What is the input method?

A

Ensure data is authorised & provides a software audit trail

56
Q

What is the range tests control method?

A

Ensure data is accurate
E.g month fields to be in the range of 1-12

57
Q

What is the format checks control method?

A

Ensures data is accurate
Everything in the correct format to be read and processed correctly

58
Q

What is the check digits control method

A

ensures accuracy
specially constructed numbers to comply with a mathematical test

59
Q

What is the sequence checks control method

A

ensures completeness
everything is accounted for

60
Q

What is the matching control method?

A

completeness

61
Q

What is the control totals control method

A

Ensures accuracy, completeness & authorisation as input batches can be authorised manually

62
Q

What are controls over processing

A

Passwords software audit trails track what processing is carried out
Programs shouldn’t be altered without authorisation & testing otherwise incorrect/ fraudulent processing can be carried out- incorrect/ fraudulent processing can be carried out

63
Q

What are controls over output

A

Password systems- each one allocated suitable access rights
Sensitive printed output- distribution list & physically safeguarded

64
Q

What are controls over output

A

Password systems- each one allocated suitable access rights
Sensitive printed output- distribution list & physically safeguarded

65
Q

What are logical access controls

A

Passwords/ usernames identify who has access to the system/ grant access to the system or files
Can have several levels of passwords

66
Q

What are firewalls

A

Combination of hardware & software between the intranet & internet
Control procedures established to allow public access to some parts of the the org’s computer system (outside firewall) while restricting access to other parts (inside firewall)

67
Q

What is data encryption

A

Disguising info to preserve its confidentiality
scrambles the data to be unintelligible unless it’s unscrambled/ decrypted

68
Q

What is virus protection

A

Control on use of external software (check for viruses before using new software)
Antivirus software, regularly updated to detect & deal with viruses
Educating employees to be watchful for viruses part of attached files to emails

69
Q

What is data visualisation?

A

allows large volumes of complex data to be displayed in a visually appealing/ accessible way to facilitate the understanding of underlying data
Improves clarity & impact

70
Q

Technology in data visualisation

A

Customisable, interactive 3D formats to manipulate and drill down in data
Find data through intuitive, user-friendly interface

71
Q

What 5 features should a features should data visualisation have

A

1) Decision - making ability (results focused)
2) Effective infrastructure (Output is reliant on sufficient quality & quantity of data)
3) Integration capability (with existing systems & business overall)
4) Prompt discovery of rules & insights (live data vital)
5) real- time collaboration

72
Q

What are the key benefits of IT data visualisation tools

A

1) Accessible
2) Real-time
3) Performance optimisation
4) Insight and understanding

73
Q

What is the benefit of accessibility

A

User-friendly and intuitive

74
Q

What is the benefit of working in real-time for IT data visualisation

A

Clear and informative
quicker responses

75
Q

What are the benefits of performance optimisation for IT data visualisation

A

immediacy & clarity of info being displayed
Better decision making
Proactive
Efficient utilisation of resources as problems identified promptly

76
Q

What are the benefits of insights & understanding for IT data visualisation

A

Combines data & visualising
Improved understanding
Fresh insights about cause & effect of data

77
Q

What is report visualisation used for?

A

Allows managers to access relevant, timely & accurate info.
Presented in an easily digestible way for effective decision-making

78
Q

What is report visualisation?

A

presents large volumes of data in an understandable format

79
Q

What are key requirements of report visualisation?

A

1) info personalised to user for optimal understanding

2) Info interactive to focus on relevant areas

3) delivery channel optimised

80
Q

What are key features of report visualisation?

A

1) Dashboards
2) Tools

81
Q

What are dashboards

A

summarised overview of info
starting point

Receive real-time info on current performance
Helps hit pre-determined targets - instant feedback & fixes
Drill down to data where necessary

82
Q

What are tools

A

Waterfall charts/ bridges - shows variances / detail about movements

Line charts- identify trends/ establish baseline for future performance

Mapping charts- geographical divisions

Pie charts- comparing data sets of component parts

ACCA Performance Management (15 decks)

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