Chapter
2-1
Foundational
Concepts of the
AIS
Chapter
2-2
Accounting Information Systems, 1st Edition
Study Objectives
1.
The interrelationships of business processes and the AIS
2.
Types of accounting information systems
3.
Accounting software market segments
4.
Input methods used in business processes
5.
The processing of accounting data
6.
Outputs from the AIS related to business processes
7.
Documenting processes and systems
8.
Client-server computing
9.
Ethical considerations at the foundation of accounting
information systems
Chapter
2-3
Business Processes and the AIS
Accounting Information System - a system that
captures, records, processes, and reports accounting
information.
Business Process - a prescribed sequence of work
steps completed in order to produce a desired result.
Chapter
2-4
SO 1 The interrelationships of business processes and the AIS
Types of Accounting Information Systems
Three categories of AIS:
1. Manual systems
2. Legacy systems
3. Modern, integrated IT systems
Chapter
2-5
SO 2 Types of accounting information systems
Types of Accounting Information Systems
Manual Systems
Generally used by small organizations. Entirely
manual system would require:
Chapter
2-6
 Source document
 General journal
 Turnaround document
 Special journals
 General ledger
 Subsidiary ledgers
SO 2 Types of accounting information systems
Types of Accounting Information Systems
Legacy Systems
Decision whether to replace or update legacy systems.
1. Screen scrapers
2. Enterprise application integration
3. Complete replacement of legacy systems
Chapter
2-7
SO 2 Types of accounting information systems
Types of Accounting Information Systems
Modern, Integrated Systems
New programs sold by software development companies
are more user friendly than legacy accounting systems.
Advantages to purchasing accounting software:
 Lower cost
 Shorter implementation time
 Fewer bugs
Chapter
2-8
SO 2 Types of accounting information systems
Accounting
Software
Market
Segments
Exhibit 2-2
Accounting Software
Market Segments
Chapter
2-9
SO 3 Accounting software market segments
Input Methods for AIS
Input methods used in organizations:
 Source documents and keying
 Bar coding
 Point of sale systems
 EDI
 E-business
Chapter
2-10
SO 4 Input methods used in business processes
Processing Methods
Batch Processing -Transactions are grouped.
Advantages
1. Efficient for large volumes of like transactions.
2. Generally use less costly hardware and software.
Online and Real-Time Processing
Advantages
1. Information provided on a timely basis. All files are
constantly up to date.
2. The business processes are integrated into a single
database so that a single system is achieved.
Chapter
2-11
SO 5 The processing of accounting data
Outputs of the AIS
General Categories of Outputs
1. Trading partner documents such as checks, invoices,
and statements
2. Internal documents
3. Internal reports
4. External reports
Chapter
2-12
SO 6 Outputs from the AIS related to business processes
Documenting Systems
Pictorial Representations of processes and systems
include:
1. Process maps
2. System flowcharts
3. Document flowcharts
4. Data flow diagrams
5. Entity relationship diagrams (ER diagrams)
Chapter
2-13
SO 7 Documenting processes and systems
Documenting Systems
Exhibit 2-7
Common System Flowchart Symbols
System
Flowcharts
Intended to
depict the entire
system, including
inputs, manual and
computerized
processes, and
outputs.
Chapter
2-14
SO 7 Documenting processes and systems
Client–Server Computing
Two Levels of Client-Server Computing:
1. Distributed presentation.
2. Distributed applications.
Chapter
2-15
SO 8 Client-server computing
Copyright
Copyright © 2008 John Wiley & Sons, Inc. All rights reserved.
Reproduction or translation of this work beyond that permitted
in Section 117 of the 1976 United States Copyright Act without
the express written permission of the copyright owner is
unlawful. Request for further information should be addressed
to the Permissions Department, John Wiley & Sons, Inc. The
purchaser may make back-up copies for his/her own use only
and not for distribution or resale. The Publisher assumes no
responsibility for errors, omissions, or damages, caused by the
use of these programs or from the use of the information
contained herein.
Chapter
2-16
Business Processes and the AIS
Concept Check
1. Which of the following statements is not true?
a.
Accounting information systems must maintain both
detail and summary information.
b. Business processes may vary from company to company.
c.
Regardless of the extent of computerization, all
accounting information systems must capture data from
the transactions within business processes.
d. Business processes categorized as expenditure processes
are not intended to be processes that serve customers.
Chapter
2-17
SO 1 The interrelationships of business processes and the AIS
Types of Accounting Information Systems
Concept Check
2. In a manual system, an adjusting entry would most
likely be initially recorded in a
a. special journal.
b. subsidiary ledger.
c. general journal.
d. general ledger.
Chapter
2-18
SO 2 Types of accounting information systems
Input Methods for AIS
Concept Check
7. An IT system that uses touch-screen cash registers
as an input method is called
a. Electronic data interchange.
b. E-business.
c. Point of sale system.
d. Source documents and keying.
Chapter
2-19
SO 4 Input methods used in business processes
Processing Methods
Concept Check
8. When similar transactions are grouped together for
a specified time for processing, it is called
a. Online processing.
b. Real-time processing.
c. Batch processing.
d. Group processing.
Chapter
2-20
SO 5 The processing of accounting data
Documenting Systems
Concept Check
10. In documenting systems, which pictorial method is
described as a method that diagrams the actual flow
and sequence of events?
a. System flowchart.
b. Process map.
c. Data flow diagram.
d. Entity relationship diagram.
Chapter
2-21
SO 7 Documenting processes and systems
Client–Server Computing
Concept Check
12. In a client–server system, when the client PC
manipulates data for presentation, but does not do any
other significant processing, it is called
a. Distributed presentation.
b. Distributed application.
c. Distributed database.
d. Distributed processing.
Chapter
2-22
SO 8 Client-server computing