ITAPP Q1

Information

Needs to be appropriately managed and is vital to the survival of contemporary business

Operational Activities

Support the firm’s day-to-day operations

Strategic Activities

Support management decision-making

Valuation Activities

Support the stewardship function of management

Information System

is a group of interrelated multiple components or subsystems that serve a common purpose

1.) Data are collected
2.) Processed into information
3.) Distributed to users

information system is the set of formal procedures which…

Accounting information System (AIS) and Management information System (MIS)

What is under information system?

1.) General Ledger / Financial Reporting System (GL, FRS)
2.) Transaction Processing System (TPS)
3.) Management Reporting System (MRS)

AIS Subsystems

1.) Financial Management System
2.) Marketing Systems
3.) Distribution Systems
4.) Human Resource Systems

MIS Subsystems

AIS Processes

Financial transactions and non-financial transactions that directly affect the processing of financial transactions

MIS Processes

Non-financial transactions that are not normally processed by traditional AIS

Input → Process →Output

Order of processing information

Input

Transactions ( financial and non-financial)

Process

Information system

Output

Information user decision

Transaction processing system (TPS)

Supports daily business operations

General Ledger / Financial Reporting System (GL/FRS)

Produces financial statements and reports

Management reporting system (MRS)

Produces special-purpose reports for internal use

Data sources

considered as an input

Data sources

financial transactions that enter the information system from internal and external source

External financial transactions

the most common source of data of most organizations

Internal Financial transactions

involve the exchange or movement of resources within the organization

1.) Data collection
2.) Data Processing
3.) Data Management
4.) Information Generation

Functions for transforming into information according to general AIS model

Data Collection

Capturing transaction data

Data collection

Recording data onto forms

Data Collection

Validating and editing the data

1.) Classifying
2.) Transcribing
3.) Sorting
4.) Batching
5.) Merging
6.) Calculating
7.) Summarizing
8.) Comparing

Kinds of Data Processing

1.) Storing
2.) Retrieving
3.) Deleting

Kinds of Data management

1.) Compiling
2.) Arranging
3.) Formatting
4.) Presenting

Kinds of Information Generation

1.) Relevance
2.) Timelessness
3.) Accuracy
4.) Completeness
5.) Summarization

Characteristics of useful information

Organizational structure

helps to allocate allocate responsibility, authority, and accountability

Organizational structure

segmenting by business function is very common method of organizing

Accounting independence

Information reliability requires ______________

Accounting independence

Accounting supports these functions with information but does not participate

Accounting independence

decision makers in these functions require that such vital information be supplied by an independent source to ensure its integrity

Distributed Data Processing

Reorganizing the computer services function into small information processing units that are distributed to end users and placed their control

Centralized Data processing

All data processing is performed by one or more large computers housed at a central site that serves users throughout the organization

Potential Advantage of DDP

Cost reductions in hardware and data entry tasks

Potential disadvantage of DDP

Loss of control
mismanagement
hardware and software incompatibility
reduntancy
segregated tasks
difficulty attracting qualified personnel
lack of standards

Clearly convey system needs & actively participate in developing systems

Accountants as Information System Users

Conceptual system

the accounting function is responsible for the __________________

Physical System

the computer function is responsible for the _________________

Conceptual System

determines the nature of information required, its sources, its destination, and the accounting rules that must be applied

Accountants as System designers

Conceptual system

External Auditor & Internal Auditor & IT Auditor

Accountants as System Auditors

External Auditor

attest to fairness of financial statements

External Auditor

Assurance service: broader in scope than traditional attestation audit

IT Auditor

Evaluates IT, often as part of external audit

Internal Auditors

In-house IS and IT appraisal services

Technology

used to describe the advancement and changes around us

Techne

Art and Craft

Applied arts

Technology used to be described as __________

Computers

Can be classified into 3 generations

Vacuum tubes

First Generation

Transistors & Memory

Second Generation

Integrated Circuits, Smaller, and more reliable

Third generation

Internet of Things

ability of devices to communicate with each other without human interference

Internet of Things

Sensors and microchips (embedded computers)

are installed in specific devices and from there,

the collected data are transmitted to an

application, usually via the internet, that will

store, process, analyze, and share this data in a

cloud

1.) Speech Recognition
2.) Logical Reasoning
3.) Creative Responses
4.) Immersive Technology

Capabilities of IoT

1.) Personal
2.) Workplace
3.) Education
4.) Transportation
5.) Health
6.) Manufacturing
7.) Commerce
8.) Environment

Tech in daily lives

Green Computing

eco-frienly use of computers and other forms of tech

Energy star

less use of energy

Computer Hardware

is the collection of all the parts you can physically touch

Processing Device

raw data into meaningful information

Central Processing Unit (CPU)

complex integrated circuit primarily responsible for converting data into meaningful information

Storage

for _______ (same word) and for retention

Computer memory

holds data and programs

1.) RAM
2.) ROM
3.) SSD, HDD, External HDD, Flash drive, Optical drive, Cloud Storage

Types of storage device under computer memory

Input device

Enter command to a computer

Output device

disseminate data and information to the user

Micro-computers

small, relatively inexpensive

Computer software

program that enables a computer to perform a specific task

1.) Operating Software
2.) Language Processor
3.) Utility Software

Classifications of system software

System software

designed to run a computer’s hardware and application programs, or provide a platform for other software

Operating System

Communicates with hardware and allows other programs to run

Operating system

Windows
MAC
Linux
Android

Language processor

“Translates” computer language and relays to the machine

Language processor

Pascal
PHP
Java

Utility Software

helps to analyze, configure, or maintain a computer or support its infrastructure

Utility software

Disk Defragmentation
Antivirus
Backup Software

Application Software

is designed to help people perform an activity

1.) Device Management
2.) Productivity
3.) Communication
4.) Personal Interest

Four classifications of Application Software

Device management

provides tools for maintaining a computer or device

Device Management

Jamf Pro
Ripping
Scale Fusion

Productivity

creation of documents, graphics, and used to interact with digital media

Productivity

Microsoft Office
Photoshop

Communication

Allows user to share or receive communication

Communication

Skype
Zoom

Personal interest

tools to pursue self-interest apps

Personal interest

Game apps

Risk

the possibility something might occur that results in an injury or loss