Accounting Information Systems Flashcards

Vocabulary flashcards based on lecture notes for exam preparation.

Data

Raw facts that are collected, recorded, and stored in a system.

Information

Data that is structured and organized to be meaningful and useful.

Business Process

A set of related, coordinated, and structured activities and tasks performed to achieve a specific goal.

Transaction

An agreement between two entities to exchange goods, services, or any other event measurable in economic terms.

Revenue Cycle

Give goods/services to get cash.

Expenditure Cycle

Get goods/services by giving cash.

Production Cycle

Give labor and raw materials to get finished goods.

Payroll Cycle

Give cash to get labor.

Financing Cycle

Give cash to get cash.

AIS (Accounting Information System)

A system that collects, records, stores, and processes data to produce information for decision makers.

Value Chain

Connects internal activities that add customer value, divided into primary and support activities.

Data Processing Cycle

The steps involved in processing data, including input, storage, processing, and output.

Source Documents

Documents used to capture transaction data.

Turnaround Documents

Documents sent to an external party and returned for further processing.

Source Data Automation

Collecting data from machines such as sales scanners.

Chart of Accounts

A list of all accounts used to record transactions.

General Ledger

A ledger containing all the balance sheet and income statement accounts.

Subsidiary Ledger

A ledger used to record detailed information for a general ledger control account.

Coding

Assigning codes to data items for classification and organization.

Sequence Code

Items numbered consecutively to account for all items.

Block Code

Blocks of numbers reserved for specific categories of data.

Group Code

Two or more subgroups of digits used to code items.

Mnemonic Code

Letters and numbers interspersed to identify an item.

Batch Processing

Processing transactions in groups at a specific time.

Enterprise Resource Planning (ERP)

Software used to manage daily business activities; integrates activities from all the cycles

What does an AIS consist of?

People who use the system, processes, technology, and controls.

How can an AIS add value to a firm?

Reduce costs, improve efficency, share knowledge, improve supply chain, improve internal control structure and improve decision making.

AIS and corporate strategy

AIS is influenced by a firm's strategy: an organization's main goal. Once set, the company decides on actions and identifies the financial and non- financial information needed to track progress.