ACCT 5310 Exam 1 Vocabulary

Vocabulary flashcards covering core topics for ACCT 5310 Exam 1, including AIS fundamentals, business cycles, transaction processing, control frameworks (COSO, COBIT, SOX), IT security, and database concepts.

Accounting Information System (AIS)

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

Data

Facts about a transaction, including the activities that take place, resources affected, and people who participate.

Information

Data that has been organized and processed to provide meaning and support decision-making.

Relevance of Information

A characteristic ensuring that information is capable of making a difference in a user's decision-making process.

Reliability of Information

A characteristic ensuring that information accurately and neutrally reflects the real-world economic events it claims to represent.

Financing Cycle

The business process focused on obtaining funds from investors and repaying them.

Human Resources / Payroll Cycle

The business process covering hiring, training, and paying employees.

Expenditure Cycle

The business process of purchasing goods and services for use in operations in exchange for cash or credit.

Production Cycle

The business process of transforming raw materials and labor into finished goods.

Revenue Cycle

The business process where goods and services are sold for cash or on credit.

Chart of Accounts

A coding system that organizes accounts and transactions within an AIS, designed for system growth and simplicity.

General Ledger

An accounting store containing summary-level data for every account type, providing a single value for each account listed.

Subsidiary Ledger

An accounting store containing detailed data for individual sub-accounts under a summary account, such as Accounts Receivable or Inventory.

General Journal

An accounting journal used to record infrequent or nonroutine transactions.

CRUD

An acronym representing the four basic types of data processing: Create, Read, Update, and Delete.

Sarbanes-Oxley Act (SOX) of 2002

Legislation that increased auditing guidelines and requires CEOs and CFOs to certify financial statements and report material internal control weaknesses.

COBIT Framework

An IT-focused framework published by ISACA in November 2019 that allows management to benchmark IT security and governance practices across the enterprise.

COSO Internal Control Framework

The most widely adopted general control framework (updated May 2013), structured around 3 objective categories, 4 organizational levels, and 5 internal control components.

CRIME

An acronym for the five components of the COSO Internal Control Framework: Control environment, Risk assessment, Information and communication, Monitoring activities, and Control activities.

Inherent Risk

The susceptibility of a set of accounts or transactions to experience significant control problems in the absence or implementation of internal controls.

Segregation of Duties

A control activity designed to reduce fraud and error opportunities by separating authorization, recording, and asset custody.

Preventive Controls

Controls designed to deter problems before they arise, such as locking up merchandise.

Detective Controls

Controls designed to discover problems that were not prevented, such as barcode scanners or log analysis.

Corrective Controls

Controls designed to identify and correct problems as well as recover from resulting errors.

IT General Controls (ITGC)

Automated controls that support the continuous, proper functioning of application controls across system operations.

Application Controls

Automated controls specific to a given business process or task within operational functions.

Trust Services Framework

An IT control framework organized around five principles: Security, Availability, Processing Integrity, Confidentiality, and Privacy.

Computer Incident Response Team (CIRT)

A team composed of IT and operations personnel responsible for responding to security incidents.

Chief Information Security Officer (CISO)

A senior or executive-level official independent from IT operations responsible for managing enterprise information security.

Patch Management

A timely and systematic process for applying security updates and patches to IT software and systems.

File

A set of logically related records stored independently within a specific department or program.

Database

A set of interrelated, centrally coordinated data files stored centrally for access across multiple applications.

Relational Data Model

A database framework that presents data in two-dimensional tables where each row (tuple) represents a unique entity or record.

Primary Key

The attribute or combination of attributes that uniquely identifies a specific row in a database table.

Foreign Key

An attribute in a database table that serves as a primary key in another table, used to link tables together.

Update Anomaly

A data error that occurs when non-primary key data is stored redundantly, requiring changes to be made to every duplicate record.

Normalization

The process of deconstructing a single comprehensive table into a set of structured relational tables to eliminate data redundancy and anomalies.

Concatenated Primary Key

A combination of two or more primary key fields combined to form a unique primary key identifier for a table row.