info systems

An information system that measures and records accounting transactions and reports them in the financial statements is called a

financial reporting system (FRS).

What is the name of the position for a person responsible for determining information needs of a business and designing a system to meet those needs?

Systems analyst

The balance sheet account most likely affected by an AIS investment in supply chain management software would be:

inventories.

The software/system that helps make sure the retail firm doesn’t have a stockout is:

supply chain management software.

Data analytics performed to identify the most profitable customers would be most likely to affect which income statement account?

Revenues

Big Data is often described by the 4 Vs, or:

volume, velocity, veracity, and variety.

According to estimates considered in the chapter, up to what percentage of a data analyst’s time is spent cleaning (or scrubbing) the data to be ready for analysis?

90 percent

The acronym ETL, in the process of readying data for use in data analysis, refers to what three words?

Extract, transform, and load

Which term is used to describe the science of examining raw data, removing excess noise from the dataset, and organizing the data with the purpose of drawing conclusions for decision making?

Data Analytics

ADS is a standard format for data files and fields typically needed to support an external audit in a given financial business process area that was developed by the AICPA. The acronym ADS stands for what three words?

Audit Data Standards

Which type of question does prescriptive analytics address?

What should we do based on what we expect will happen?

Which type of question does predictive analytics address?

Will it happen in the future?

What type of analytics addresses questions of “Why did it happen”?

Diagnostic analytics

What type of analytics would address the question of whether a customer will ultimately pay if credit is granted?

Predictive analytics

If we wanted to know what score we needed to get on the final in this class based on our expected performance before the final, we would call that ________

Prescriptive

Business process

Specifying accountability

Training

Facilitating process improvement

Supporting internal audit

Which of the following describe characteristics of good BPMN models?

Clear, Complete, Consistent, Valid

Which of the following statements about sequence flows is not true?

Sequence flows may not cross lane boundaries.

Which of the following best describes an exclusive gateway?

A gateway with only one exit path per instance of a process.

Which of the following best describes an inclusive gateway?

A gateway with one or more exit paths per instance of a process.

Which of the following is true about start events?

A start event can catch a message.

Which of the following is true about end events?

An end event can throw a message.

Which of the following is true about intermediate timer events?

The process delays until a specific date or time.

Which of the following best describes an intermediate error event?

It is modeled with a leaning Z or flash sign, It indicates that an alternate sequence flow begins when an error occurs, It is a boundary event attached to the boundary of an activity

Which of the following best describes a looping task?

The task repeats until a condition is satisfied.

Which of the following is not true about data objects?

They can be linked to other pools with message flows.

Which of the following are not true about data associations?

They connect data objects to intermediate events.

Which of the following is not a step in preparing process models?

Review BPMN standard

Accounting Information System

A system that records, processes, and reports on transactions to provide financial and non-financial information for decision-making and control.

Data vs. Information ( data)

data that consists of raw facts that describe an event and hold little meaning on their own.

Data vs. Information ( info)

is data organized in a meaningful way to be useful to the recipient. Data serves as the input to produce information

Information Overload

Occurs when an excessive amount of data hinders effective decision-making

Information Value Chain

The progression from a Business Need - Business Event- Data - Information - Knowledge - Decision.

Relevance

Capable of making a difference in a decision. It includes predictive value, feedback value, and materiality

Faithful Representation

Accurately reflects the true condition of the business. It must be complete, neutral, and free from error

Mandatory Information

Required by law (e.g., Form 10-K annual reports, tax returns). Management typically focuses on minimizing the costs of producing this data.

Discretionary Information

Not required by law (e.g., using Activity-Based Costing to track overhead).

CISA (Certified Information Systems Auditor)

For performing IT audits

CITP (Certified Information Technology Professional)

Focused on managing data reliability, security, accessibility, and relevance

CIA (Certified Internal Auditor)

Globally accepted certification for internal auditing

Primary Activities

Inbound Logistics, Operations, Outbound Logistics, Marketing & Sales, and Service

Support Activities

Firm Infrastructure, Human Resource Management, Technology, and Procurement.

Supply Chain Management

Optimizes the flow of materials, information, and payments from suppliers to customers

Customer Relationship Management

Manages interactions with customers, tracks past purchases, evaluates customer satisfaction, and guides product placement.

Revenues

Driven up by CRM identifying and attracting profitable customers

Cost of Goods Sold (COGS

Lowered by SCM reducing inventory obsolescence, storage, and procurement costs

SG&A Expenses

Reduced through efficient ERP support processes

Interest Expense:

Decreased because SCM lowers inventory levels, reducing the debt required to finance assets

Data Analytics

The science of examining raw data, removing noise, and organizing information to draw conclusions for business decision-making

The AMPS Model

• Ask the Question.

• Master the Data.

• Perform the Analysis.

• Share the Story.

Extract, Transform, and Load (ETL)

The process of scrubbing extraneous data and noise. Data professionals spend 50% to 90% of their time cleaning data

Data Considerations

Evaluated based on Accessibility, Reliability, Integrity, Ethics (moral responsibility in gathering/protecting), and Type (structured vs. unstructured)

Audit Data Standards (ADS

A standardized set of data files and fields defined by financial business processes to alleviate the time and cost of cleaning data for external audits.

The Power of Visualizations

Graphical representation of data via charts, graphs, or images

Data Acquisition & ETL Tools:

Alteryx, SQL, Tableau Prep, and Power Query

Analysis & Visualization Environments

Microsoft Excel (basic), Tableau Desktop (advanced), Power BI (advanced), as well as programming languages like R and Python

Traditional Focus

Stewardship, financial reporting, and compliance auditing

Modern Focus

Optimizing processes, uncovering competitive advantages, maximizing shareholder value, and supporting evidence-based strategic planning

IMA Management Accounting Competency Framework

Outlines six core skills: Strategic Management, Reporting and Control, Technology and Analytics, Business Acumen and Operations, Leadership, and Professional Ethics

Sarbanes-Oxley Act of 2002 (SOX)

Made formal business process documentation mandatory.

Business Process

A defined sequence of activities using resources to transform inputs into outputs to achieve a specific goal

Business Analysis

Defining business process requirements and evaluating potential improvements

Business Model

A simple, abstract representation of one or more business processes

Documentation

Explains how business processes and systems work; serves as a mechanism for compliance, accountability, training, and communication

BPMN

A specialized process modeling language maintained by the Object Management Group (OMG) designed to be easily understood by all business stakeholders

The Token Concept

A theoretical token is generated by a start event and travels exclusively along sequence flows through flow objects until it is consumed at an end event. Tokens never travel along message flows.

Message Events

An envelope icon inside a circle. White envelopes indicate catching an incoming message; black envelopes indicate throwing an outgoing message

Timer Events

A clock icon inside a circle indicating a process trigger at a specific date/time or a defined delay duration.

Volume

The massive amount of data involved

Velocity

The rapid speed at which data arrives or streams in real time

Variety

Unstructured or unprocessed data types (e.g., social media comments, emails, GPS data

Veracity

The overall quality, cleanliness, and representational faithfulness of the data

Activities: like folio -

Represented by rounded rectangles. They depict specific steps and must be labeled with short verb phrases

Gateways

Represented by diamonds. They handle process branching and merging, and typically appear in matching pairs

Sequence Flows

Solid lines with filled arrowheads indicating the step-by-step progression within a single pool

Message Flows

Dashed lines with an open circle at the source and an open arrowhead at the destination. They model interactions between separate pools (organizations)

Associations

Dotted lines (with or without an arrowhead) connecting data objects or data stores to specific activities

Exclusive

Only one outgoing path can be selected per process instance

Inclusive

One or more paths can be selected simultaneously. Merging inclusive gateways synchronize the concurrent paths

Parallel

All outgoing paths must be executed simultaneously. Merging parallel gateways pause execution until all parallel paths arrive

Message Events

An envelope icon inside a circle. White envelopes indicate catching an incoming message; black envelopes indicate throwing an outgoing message

Timer Events

A clock icon inside a circle indicating a process trigger at a specific date/time or a defined delay duration

Boundary Error Events

An attached intermediate event on the border of an activity block. It interrupts normal process flow to handle an exception or error

Collapsed Subprocess

A rounded rectangle containing a small plus sign ($+$) indicating hidden underlying process details documented in another diagram

Looping Activity

A circular arrow icon indicating the activity repeats continuously until a specific condition is met

Data Object

A document-shaped icon representing data elements created or used only for the duration of that specific process instance

Data Store

A cylinder icon representing persistent data available across multiple distinct processes