AIS Exam 1 (Chapter 4 & 5)

Changing Roles of Accountants

Past - Focus on stewardship & reporting, prep. financial reports, auditing

Present - Help enterprises optimize processes, achieve competitive advantage, max S/H value

Business Process

Defined sequence of business activities that use resources to transform specific inputs into specific outputs to achieve a business goal

Business Analysis

The process of 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 business systems work; a tool for information transmission and communication

Sarbanes-Oxley Act of 2002

Made documentation required for businesses.
Required managers to assess and attest business’s IC structure and procedures.
Required external auditors to audit mgnt’s assessment of effectiveness of IC & express opinion of company’s ICFR

Activity Model

Represent the sequential flow and control logic of a set of related activities.

Business Process Model and Notation (BPMN)

Model designed to show business processes

What makes a good BPMN?

Correct, Clear, Complete, Consistent

Activities

Describes an action being taken

Sequence Flow

Progression of activity within the process

Gateways

Shows process branching and merging as a result of a decision

Pools and Lanes

Pools - Shows the organization as a whole

Lanes - Shows departments or functional area within the org.

Flow can cross through lanes

Message Flow

Exchanges between two different pools. (Token doesn’t flow through message flows)

Exclusive Gateway

Only one path can be taken (this or that)

Inclusive Gateway

One or more paths can be taken (this, that, or both)

Parallel Gateway

All paths must be taken (this and that)

Intermediate Timer Event

Indicates delay in process flow until specific time, date, or period

Intermediate Error Event

Indicates alternative flow when an error occurs

Steps to Prepare BPMN

1. Purpose

2. Context

3. Basic Process Flow

4. Activities

5. Decompose (if necessary)

6. Validate

Structure Model

Describe the data and information structures inherent in a business process

Unified Modeling Language (UML)

Class diagrams describe the logical structure of a database system

Classes

Separately identifiable collections of things about which the organization wants to collect and store information

Associations

Depict the relationship between two classes

Multiplicities

Describe the minimum and maximum number of times instances of one class can be associated with instances in another class

Types of Classes

Resources (trucks, machines, buildings), Persons/Agents (customers, employee), Events (sales, purchase, cash receipts)

Attributes

data elements that describe the characteristics of instances in a class

Primary Keys

An attribute or combination of attributes that uniquely identifies each instance in a class or row in a table

Foreign Keys

An attribute or combination of attributes that allows tables to be linked together

Linking Table

Connects a many-to-many association to utilize multiple primary & foreign keys

Internal Controls

Prevent problems, detection of problems that arises, correction of errors & related losses