Chapter 1 - Introduction to
Accounting Information
Systems
Accounting Information Systems 8e
Ulric J. Gelinas and Richard Dull
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Learning Objectives
• Appreciate the complex, dynamic environment in
which accounting is practiced.
• Know the relationship between the AIS and the
organization’s business processes.
• Know the attributes of information.
• Recognize how information is used for different types
of decisions and at various levels in the organization.
• Recognize how the information system supports the
management function.
• Recognize the accountant’s role in relation to the
current environment for the AIS.
• Understand how to use this textbook effectively to
learn AIS.
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Textbook Themes
1.
2.
3.
Enterprise Systems — integrates business
process functionality and information from all of
an organization’s functional areas (marketing
and sales, cash receipts, purchasing, cash
disbursements, human resources, production
and logistics, and business and financial
reporting).
E-business — use of networks to undertake
business processes.
Internal Control — a system of integrated
elements that provide reasonable assurance
that a business will reach its business process
goals.
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Sarbanes-Oxley Act of 2002
Section 404 –
• Management must identify, document, and
evaluate significant internal controls.
• Auditors must report on management’s assertions
regarding internal controls.
Section 409 –
• Requires disclosure to the public on a
“rapid and current” basis of material changes in an
organization’s financial condition.
Implications for both public and private accountants
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Elements in the Study of AIS
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2008 Top Technology Initiatives
1. Information Security
Management
2. IT Governance
3. Business Continuity
Management and
Disaster Recovery
Planning
4. Privacy Management
5. Business Process
Improvement,
Workflow and Process
Exception Alerts
6. Identity and Access
Management
7. Conforming to
Assurance and
Compliance Standards
8. Business Intelligence
9. Mobile and Remote
Computing
10. Document, Forms,
Content, and
Knowledge
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Management
Accounting Systems and Sub-systems
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Accounting Systems and Sub-systems
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Accounting Systems and
Subsystems
• A system is a set of interdependent
elements that together accomplish
specific objectives.
• A subsystem is the interrelated parts
that have come together, or integrated,
as a single system, which we have
named System 1.0.
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Information System Model
• An information system (IS) or management
information system (MIS) is a manmade system
that consists of an integrated set of computerbased and manual components established to
collect, store, and manage data and to provide
output information to users.
• The figure on the next slide depicts the functional
components of an information system.
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Information System Model
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Purpose of AIS
• Collect, process and report information
related to the financial aspects of
business events.
• Often integrated and indistinguishable
from the overall information system.
• Like the IS, the AIS may be divided into
components based on the operational
functions supported.
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A Logical Model of
a Business Process
1. Management
hires personnel
and establishes
the means for
accomplishing
the work of the
organization.
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A Logical Model of
a Business Process
2. Management
establishes broad
marketing objectives
and assigns specific
sales quotas by
which progress
toward the long-run
objective can be
measured. In
addition,
management designs
the IS procedures for
facilitating
operations, such as
the procedures used
to pick and ship
goods to the
customer.
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A Logical Model of
a Business Process
3. Normal
operations
begin with
the IS
receiving a
customer’s
order to
purchase
goods.
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A Logical Model of
a Business Process
4. The IS
acknowledges
the customer’s
purchase
order.
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A Logical Model of
a Business Process
5. The IS
sends a
request to the
warehouse to
ship goods to
the customer.
This request
identifies the
goods and
their location
in the
warehouse.
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A Logical Model of
a Business Process
6. A document
(i.e., a packing
slip) identifying
the customer
and the goods
is attached to
the goods.
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A Logical Model of
a Business Process
7. The goods
are shipped
to the
customer.
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A Logical Model of
a Business Process
8. The
shipping
department
reports to the
IS that the
goods have
been
shipped.
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A Logical Model of
a Business Process
9. The IS
prepares an
invoice and
sends it to
the
customer.
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A Logical Model of
a Business Process
10. The IS
sends
management
a report
comparing
actual sales to
previously
established
sales quotas.
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Transforming Data into Information
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Transforming Data into Information
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Information Qualities
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Information Qualities
Control Matrix
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Management Decision Making
1. Intelligence: Searching the
environment for conditions calling for a
decision.
2. Design: Inventing, developing, and
analyzing possible courses of action.
3. Choice: Selecting a course of action.
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Management Decision Making
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Management Problem Structure
and Information Requirements
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Management Problem Structure
and Information Requirements
• Horizontal flows relate to specific business
events, such as one shipment, or to individual
inventory items. The information moves through
operational units such as sales, the warehouse,
and accounting.
• Vertical flows relate to the flow of information
to and from strategic management through
tactical management, operations management,
and operations and transaction processing.
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Accountant’s Role in Current
Business Environment
• Designer — application of accounting
principles, auditing, information
systems, and systems development.
• User — participate in design.
• Auditor — provide audit and assurance
services.
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