Week 2 And 3 - Transaction Processing And Documentation

Question 1

What is data processing?

Answer 1

Data processing is the collection and manipulation of items of data to produce meaningful information.

Question 2

What are the three stages in the data processing cycle?

Answer 2

1. Data input
2. Data storage or Data processing
3. Information output

Question 3

In relation to data input, what volume of a businesses activities have to be inputted into the system?

Answer 3

We need to capture data every time a business does something.

Question 4

What 3 types of data are captured in the data input stage?

Answer 4

1. Activity of interest (E.g. Sale).
2. Resources affected (Inventory, cash).
3. People who participated in the activity (customer/employee)

Question 5

What are the four main reasons for fat finger errors to occur?

Answer 5

• Speed of data entry
• Sticky keyboards
• A misunderstanding of units
• Confusion between net and gross amounts

Question 6

What are the three forms of source documentation?

Answer 6

Paper source documentation - receipts, invoices etc

Turnaround documentation - a document given out, completed and retuned.

Source data automation - data is collected by computers. Barcodes etc

Question 7

What is the organisational structure of data (finance related) within a firm?

Answer 7

General ledger

Subsidiary ledgers

Transaction journals

Question 8

What is the general term which describes the way in which a firms organised data is stored?

Answer 8

Coding schema or the Chart of Accounts

Question 9

What is meant by the term ‘General Ledger Coding Structure’?

Answer 9

The General Ledger Coding Structure is the set of nested accounts in which a business records its transactions

Question 10

In order for a General Ledger Coding Structure to be useful, what 4 things must it be…

Answer 10

Logical
Intuitive
Valuable
Expandable

Question 11

Why is it important to get the general ledger coding structure right from the start?

Answer 11

It usually cannot be amended without significant upheaval
And
It establishes the relationship between accounting elements
And
It sets limits on the granularity of analysis and reports
And
It determines authority for management (in charge of all accounts beginning with 2/3/4 for example)

Question 12

What are the 4 basic functions of data processing?

Answer 12

Create new records

Read existing records

Update previous records

Delete data

Question 13

What does the term ‘real-time’ mean in relation to data processing?

Answer 13

Data accumulated through business activities is processes as and when it occurs.

Question 14

When data has been stored, it can be viewed either as…

Answer 14

A soft or hard copy

Question 15

What does ‘ERP’ stand for? And what does this mean?

Answer 15

Enterprise Resource Planning system.

The enterprise resource planning system integrates all data collected from all business cycles.

Question 16

How many businesses cycles are there and what are they?

Answer 16

4

Revenue cycle
Expenditure cycle
Conversion cycle
Management cycle

Question 17

Give one example of an ERP systems software package

Answer 17

SAGE

Question 18

Give 4 advantages of a good ERP system

Answer 18

• Data is only captured once
• Enterprise-wide single view of an organisations data.
• Greater visibility and monitoring capabilities for management.
• Higher level of data security.
• Time saved through automation.
• Standardisation of procedures and reports.
• Improves level of customer service

Question 19

Give 4 disadvantages of an ERP system

Answer 19

• Complexity
• User resistance
• Time to implement is significant
• Expensive to implement

Question 20

What is the storage pattern for a database from broad to specific?

Answer 20

File
Record
Field

Question 21

What is the main advantage of using a database?

Answer 21

The data and applications to use the data are independent of each other.

Question 22

users of databases have what view?

Answer 22

Logical view

Question 23

Designers of databases have what view?

Answer 23

Physical view

Question 24

What legislation is in place in the UK that ensures that companies document their activity?

Answer 24

Companies act 2006

Question 25

What is meant by the term ‘Big Data’?

Answer 25

Big data is a term used to describe the phenomenon of creating, curating and exploiting extremely large sets of data to reveal patterns and behaviour.

Question 26

What industry is the use of big data specifically useful?

Answer 26

The retail industry

Question 27

Give 3 examples of where big data comes from

Answer 27

Mobile phones
Internet interactions
Social media
GPS devices
Smart speakers

Question 28

What are 3 practical issues with big data?

Answer 28

Storage

Processing capacity

Timeliness of analysis

Question 29

What are the 7 characteristics of big data and what do they each mean?

Answer 29

1. Velocity: speed of data generation.
2. Volume: the amount of data collected per second
3. Variety: what form does the data come in?Structured and unstructured
4. Value: How is big data monetised?
5. Veracity: Does big data collection reduce reliability?
6. Variability: Is big data a pattern or one off?
7. Visualisation: summarise big data into compressible ‘big pictures’