Unit 3 - Module 6 Flashcards
Relationship of GLS to Other Information Subsystems
general ledger master file
Principal file in the GLS database. This file is based on the organization’s published chart of accounts.
general ledger history file
has the same format as the GL master. Its primary purpose is to provide historical financial data for comparative financial reports.
journal voucher file
is the total collection of the journal vouchers processed in the current period. This file provides a record of all general ledger transactions and replaces the traditional general journal.
journal voucher history file
File that contains journal vouchers for past periods.
responsibility center file
contains the revenues, expenditures, and other resource utilization data for each responsibility center in the organization. The MRS draws upon these data for input in the preparation of responsibility reports for management.
budget master file
contains budgeted amounts for revenues, expenditures, and other resources for responsibility centers. These data, in conjunction with the responsibility center file, are the basis for responsibility accounting, which is discussed later in the chapter.
sophisticated users
Users of financial reports who understand the conventions and accounting principles that are applied and that the statements have information content that is useful.
Financial Reporting Process
- Capture the transaction.
- Record in special journal.
- Post to subsidiary ledger.
- Post to subsidiary ledger.
- Post to general ledger.
- Prepare the unadjusted trial balance.
- Prepare the unadjusted trial balance.
- Make adjusting entries.
- Journalize and post adjusting entries.
- Prepare the adjusted trial balance.
- Prepare the financial statements.
- Journalize and post the closing entries.
- Prepare the postclosing trial balance.
Real-Time General Ledger and Financial Reporting System
The potential risks to the FRS include the following:
-A defective audit trail.
-Unauthorized access to the general ledger.
-GL accounts that are out of balance with subsidiary accounts.
-Incorrect GL account balances because of unauthorized or incorrect journal vouchers.
small data analytics
It characterizes techniques that employ data that are in a format and of a volume that allows them to be analyzed and acted upon by traditional technologies.
big data analytics
Its current rendition is characterized and defined by three Vs: extreme volumes of data, the rapid velocity at which the data must be processed, and the wide variety of structured and unstructured data types that need to be integrated.
data warehouse
Database constructed for quick searching, retrieval, ad hoc queries, and ease of use.
data mining
Process of selecting, exploring, and modeling large amounts of data to uncover relationships and global patterns that exist in large databases but are hidden among the vast amount of facts.
verification model
Drill-down technique to either verify or reject a user’s hypothesis.
discovery model
Model that uses data mining to discover previously unknown but important information that is hidden within the data.
Volume
It refers to terabytes, petabytes, and even exabytes of data.
Velocity
It refers to the speed at which big data must be analyzed.
variety
It is the primary driver of volume.
Prescriptive analytics
It tells the user what actions should be taken in response to specific questions.
Predictive analytics
It encompasses a variety of statistical techniques that draw upon current and past data to calculate the statistical likelihood of future scenarios occurring.
Descriptive analytics
It is a mathematical process that describes real-world events and the relationships between factors responsible for them.
Diagnostic analytics
These techniques view past performance to determine why something happened the way it did.
What type of data is found in the general ledger master file?
balances for each account in the chart of accounts subsidiary details supporting a control account budget records for each account in the chart of accounts a chronological record of all transactions
budget records for each account in the chart of accounts
The correct answer is “balances for each account in the chart of accounts.” Balances for each account in the chart of accounts are found in the general ledger master file. The text describes the general ledger file as the information hub for the accounting system. Each record in the general ledger master file corresponds with one of the accounts in the chart of accounts. Each record is either a GL Master account (i.e., Sales) or a control account (i.e. Accounts Receivables control)
Which report is an output of the financial reporting system (FRS)?
comparative balance sheet variance analysis report item master report customer report
comparative balance sheet
The correct answer is “comparative balance sheet.” A comparative balance sheet is an output of the financial reporting system. The law requires that corporations generate a series of financial reports – Income Statement, Balance Sheet, Statement of Cash Flows, Tax Returns, and others. This requirement is met by the financial reporting system.
A characteristic of the management reporting system (MRS) is
-that it operates in conformity with generally accepted accounting principles.
-that it focuses on internal decision-making information.
-that it implements SEC requirements.
-that it is a legal requirement that the MRS be installed and functioning properly.
-that it focuses on internal decision-making information.
The correct answer is “that it focuses on internal decision-making information.” The management reporting system (MRS) focuses on internal decision-making information. The MRS is the source for reports that managers will use to analyze business performance such as variance analysis, production efficiency, sales, and purchases.
Big data analytics are characterized by
volume, velocity, and variety of data. verification, variance, and variety of data. velocity, volume, and verification of data. volume, variance, and velocity of data.
volume, velocity, and variety of data.
The correct answer is “volume, velocity, and variety of data.” Big data analytics are characterized by volume, velocity, and variety of data. These are referred to as the three Vs: extreme volumes of data (megabytes, terabytes, petabytes, etc.), the rapid velocity at which the data must be processed (particularly in applications involving machine learning and artificial intelligence), and the wide variety of structured and unstructured data types that need to be integrated (audio, video, external web data, social media, the financial reporting system, the management reporting system).
What function does prescriptive analytics serve?
-It is a mathematical process that describes real world events and the relationships between factors responsible for them.
-It tells the user what actions should be taken in response to specific questions.
-It views past performance to determine why something happened the way it did.
-They are data warehousing processes.
-It tells the user what actions should be taken in response to specific questions.
The correct answer is “It tells the user what actions should be taken in response to specific questions.” Prescriptive analytics tells the user what actions should be taken in response to specific questions. For example, some companies use predictive analytics to optimize trade promotions. Prescriptive analytics helps them determine which campaigns to run and for which products.
