AIS Notes
April 29, 2022
Review:
1. Journal – for accuracy
- account or element of FS
2. Ledger
FS
- General/External users
- Mandated by the BIR
- GENERAL PURPOSE FS (PAS 1)
TPU
1. Revenue Cycle
 Accounts Receivable
Sales
 Cash in bank
Accounts Receivable
IFRS 9 – Matching Principle



Bad debt expense
Allowance for Doubtful Account
Allowance for Doubtful Account
Accounts Receivable
Interest Expense
Interest Revenue
Direct Method – required by BIR
Allowance Method – GAAP
- to determine tax assets/liabilities
* AR has interest – Materiality
* NR – Promissory note
PV – FV = I
2. Expenditure Cycle
 Utilities Expense (VAT)
Accounts Payable (Expanded WHTX)
Fixed Assets
 Equipment (VAT)
Cash in bank (Expanded WHTX)
 Depreciation Expense (VAT)
Accumulated Depreciation (EWHTX)
Examples:
Statement of
- Financial Position
- Financial Performance
- Cash Flows (PAS 7)
- Shareholder’s Equity
- Notes to FS (disclosures)
PAS 8
- PFRS/IFRS (SEC-DOF)
- GAAP
- LAW (BIR-DOF)
File format
∙ PDF (Portable Document Format)
- Flat file/static file
∙ Recent developments
 XML (eXtensible Markup Language)
- Sample posted on gclass
- Used by:
BSP (DAT/CSV)
BIR (API)
 HTML
MS
Management
Reporting System
Management
Report
3. Conversion Cycle
Management Report
- Management Specific
- Flexible
- Discretion of Management/Users
GENERAL LEDGER SYSTEM
FRS
F/S
GLS
MRS
M/S
Management Principle
1. Formalization of tasks (specialization)
a. Flat – narrow authority line
b. Matrix – gray/mixed authority line
c. Hierarchal – wide authority line
Implication:
- Information or Data
AIS Notes
April 29, 2022
-
Users of data
2. Responsibility AND Authority
Responsibility – “what to do”
Authority – “who does it”
- Power and Control
3. Span of Control
- Number of reporting line
- Chain of command
- Importance because of the previous principle
(R&A)
4. Management by exception
-
Breaches/Irregularity line (problem)
More summarization
Targeted
Middle management
Management by objectives
-
Efforts to achieve the goal
Top level
Management Function
Objectives – given by BOD
1. Strategic
- Long-term
- Top level
2. Tactical
- Short term
- Middle level
3. Management Control
- Middle Management
4. Operational Control
- Low Management
Granularity – level of details
Problem
- Know first if it is really a problem
Reality x
Symptom x
Real Problem
Structured
-
Organized/Defined
Collection Recon system
Unstructured
- Automation
- Process improvement
TO:DO
Study:
- Types of Management Report
- Responsibility Accounting
Quiz #1
- Cancelled
Research
- Chat GPT
- VBA Excel (to be discussed next meeting)