PPT 1 Flashcards
It identifies, collects, processes, and communicates economic information about a firm using a wide variety of technologies
ACCOUNTING INFORMATION SYSTEM
It gets and records the financial effects of the firm’s transactions
ACCOUNTING INFORMATION SYSTEM
It distributes transaction information to operations personnel to coordinate many tasks.
ACCOUNTING INFORMATION SYSTEM
an event that affects or is of interest to the organization and is processed by its information system as a unit of work.
TRANSACTION
Economic events that affect the assets and equities of an entity.
Financial Transaction
All other events processed by the organization’s information system.
Non-Financial Transactions
TYPES OF TRANSACTIONS
Financial Transaction
Non-Financial Transactions
AIS SUBSYSTEMS
-Transaction Processing System (TPS)
-General ledger/ Financial Reporting System (GL/FRS)
-Management Reporting System (MRS)
Supports daily business operations
Transaction Processing System (TPS)
Produces financial statements and reports
General ledger/ Financial Reporting System (GL/FRS)
Produces special-purpose reports for internal use.
Management Reporting System (MRS)
THE GENERAL AIS MODEL
DATA COLLECTION
DATA PROCESSING
DATA MANAGEMENT
INFORMATION GENERATION
USERS OF ACCOUNTING INFORMATION
-Internal users(Primary Users)
-External users(Secondary Users)
Internal users(Primary Users)of accounting information include the following:
Management:
Employees:
Owners:
External users(Secondary Users)of accounting information include the following
Creditors
Tax Authorities
Investors
Customers
Regulatory Authorities
ACCOUNTANTS’ UNIQUE ROLES IN THE AIS
- Accountants must be able to clearly convey their needs to the systems professional who design the system
- The accountant should actively participate in system development projects to ensure system design
Accountants as System Designers
-Accountants are the domain experts and responsible for the conceptual design of the AIS.
-Conceptual system design involves specifying the criteria for identifying delinquent customers and the information that needs to be reported.
Certify the fairness of the presentation of financial statements.
External Auditors
An independent appraisal function established within an organization to examine and evaluate its activities as a service to the organization.
Internal Audit
Investigate anomalies and gather evidence of fraud.
Fraud Audit
Accountants as System Auditors
External Auditors
Internal Audit
Fraud Audit
THE ROLE OF THE AUDIT COMMITTEE
-A subcommittee of the Board of Directors that has special responsibilities regarding audits.
-An independent “check and balance” for internal audit function and liaison with external auditors
-Usually three people (outsider)
-SOX (Sarbanes-Oxley Act) require one to be a financial expert.
