Topic 1C: Accounting for Management 3: Data Flashcards
What is data?
The raw material for data processing. Relates to fact, events and transactions and so forth
What is information?
This is data that has been processed in someway to make it useful to the person who has received it. It is anything which is communicated
What are the qualities of a bank statement that makes it a good source of information?
Accurate, complete, cost beneficial, user targeted, relevant, authoritative, timely and easy to use, timely and easy to use
Why must information be accurate?
Inaccurate figures would mislead the company as to its current bank balance
What must information be complete?
The information in the bank statement will be used to reconcile and identify and transactions not included in the accounts
Why must information be cost beneficial?
A company will not be willing to pay an excessive amount to view the transaction that have occured through its account - the cost of collecting and presented this infomration should therefore be evaluated
What is meant by information being user targeted?
The volume of the information is key to a minimum needed for the customer. Details meaningful only to bank are exlcuded
What is meant by information being relevant?
The customer is not interested in all the information that occurred for the entire bank - only information relating to the user is included
What is meant by information being authoritative?
The information within the bak statement can be used for control purposes as the bank is considered a reliable and authoritative source
What is meant by information being timely?
In order to be useful, the information needs to be provided within a sensible time period
What is meant by information being easy to use?
Always in the same format
What is meant by the limitations of information for decision making?
All decision making is concerned with the future so there will always be a degree of uncertainty surrounding the possible outcomes of a decision, meaning information for decision making should have uncertainty in some way
