AIS Exam 1

What is the definition of AIS?

system that records, processes and reports on transactions to provide financial and non-financial information to make decisions and have appropriate levels of internal controls for those transactions

4 elements of of a simple information systems

input, storage, processing, output

what is the information value chain

The overall transformation from a business need and a business event to the collection of data and information to an ultimate decision

what are the four diff==er==ent roles accountants have

User, manager, designer, evaluator

Describe how business processes affect the firm’s value chain

Primary activities directly provide value to the customer (inbound, operations, outbound, marketing and sales activities, and services). Supporting activities include (infrastructure, HR, technology, and procurement). AIS can add value making each primary activity more effective and efficient

Explain how AIS affects firm value

Making each support and primary activity more effective and efficient

How does AIS assist the firm’s internal business processes

AIS assists in business integration with external parties such as suppliers and customers.

What is a supply chain?

The flow of materials, information, payments, and services from raw materials suppliers, through factories and warehouses. all the wat to the final customers of the firm’s products

What are the 4 AIS strategic roles

Automate: replace human labor

Informate-up: provide info to senior management

Informate-down: provide info to all employees

transform: redefine fundamentals of business processes and relationships

Roles of accounting/finance

1. Finance and accounting processes - pay, cash, report, payroll, treasury
2. Financial close - period end
3. Financial consolidation, reporting, and analysis
4. Providing comprehensive management information
5. People management


1. Using IT to make finance and accounting processes more efficient and effective

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What is the business process

defined sequence of business activities that use resources to transform specific inputs into specific outputs to achieve a business goal. A business process is constrained by business rules

What is business analysis

The process of defining business process requirements and evaluating potential improvements. Business analysis involves ascertaining, documenting, and communicating information about current and future business processes using business modeling and relating tools

How has SOX made documentation essential

1. Training
2. Describing current processes and systems
3. Auditing
4. Accountability
5. Standardized interactions
6. Facilitating process improvement

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Well managed businesses


1. Effectiveness
2. Efficiency
3. Internal control
4. Compliance w/ standards and policies

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What is a business model

A simple, abstract representation of one or more business processes. Typically a graphical depiction of the essential business process information

Characteristics of activity models

They describe


1. Events that start, change, or stop flow in the process
2. Activities and tasks within the process
3. The sequence of slow between tasks
4. Decision points that affect the flow


1. Division of activity depending on organizational roles

Building Blocks for BPMN

1. Events - start/end
2. Activities - rectangle verb + object
3. Sequence flows - arrow btwn activities
4. Gateways - diamond
5. Annotations - add description

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What is a pool

BPMN symbols used to identify participants, actors, or persons that perform activities and interact with other participants in a process

What are the lanes

BPMN symbols that provide subdivisions of pools to show, for example, functional responsibilities within an organization

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What are message flows

BPMN represents exchanges between two participants in the same process as message flows which are models as dashed arrows

What is a gateway

Shows process of branching and merging as a result of a decision. Diamond shape

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types of gateways

1. Exclusive - one option (blank diamond or w/ x)


1. Inclusive - one or more (diamond w/ o)
2. Parallel - all (diamond w/ +)

What is an activity

represents specific steps in a business process

Intermediate error

lightening bolt

I+I

subprocess (detailed process hidden)

Message event

envalope

Clock

timer event

Loop w/ arrow

looping (repeat event until satisfy)

3 horizontal lines

sequential (perform task several times at different times)

3 vertical lines

parallel (task performed several times all at same time)

Data object

represents data that is only available for the duration of a process

data store

represents data that is available across processes

association

connects data object/store to an activity. shows direction it flows

purpose of structure models

create a blueprint for the development of a relational database to support the collection, aggregation, and communication of process information

classes

separately identifiable collections of things about which the organization wants to collecct and store information

Associations

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relationship btwn 2 classes

Multiplicities

describe min/max number of times instances can be associated in another class

Best practices for preparing a UML

1. Use common terminology in the organization for class names
2. Link classes on the diagram only when there is a clear business \n purpose for the relationship.
3. Avoid crossing lines where possible
4. Use consistently sized class rectangles
5. Avoid running association lines close together
6. Opt for simplicity
7. Focus first on the accuracy of the content, then address appearance.


1. Use notes to explain more complex situations.

Primary keys + purpose

Attribute or combo of attributes that uniquely identify an instance of a class in a data model or a specific row in a table. Purpose: unique identification

Relationship btwn classes and tables

Each instance of a class maps to a row in a corresponding table. 1:1

Process decision requirements

1. Identify decisions required in the process
2. Describe and document decisions and impact on business objectives
3. Specify decision requirements in terms of information and knowledge required to make the decision
4. Decompose and refine requirements where more are needed

Business rules support process decisions

1. Eligibility or approval
2. Validation
3. Calculation
4. Risk
5. Fraud
6. Opportunity
7. Assignments
8. Targeting

What are business rules

Succinct statements on constraints on business processes. Provide logic of behavior oof the business in a specific situation.

What is a relational data model

Stores information int he form off related two-dimensional tables

Classes in a relational database

Resources, Events, Agents (REA)

Resources (REA)

Cash

Events (REA)

Purchasing

Agents (REA)

Supplier

Tables (relational database)

Store Data

Attributes (relational database)

characteristics, properties, or adjectives that describe each class

Records (relational database)

represents all specific data values that are associates with once instance

What is main purpose of using foreign key

Provides logical relationship or link between two tables

SQL

Computer language designed to retrieve data from a relationship database

FROM \[\]

indicates name of table retrieving from

SELECT \[\]

which columns of table included in query

WHERE \[\]

criteria that must be met to be shown

\*

all columns should be selected

GROUP BY \[\]

aggregate functions based on one or more columns

ORDER BY \[\] ASC/DSC

ASC or DSC

BETWEEN

end points of a range

What is cloud computing

Using redundant servers and multiple locations to host virtual machines

Business activities associated with the sales collection process

1. selling products and services
2. maintaining customer records
3. billing customers
4. recording payments from customers


1. aging accounts and authorizing credit

Basic Sales Activity Model

Start > provide quote > receive order > prepare products > apply graphics > deliver order > invoice customer > receive payment > end

Collaboration

BPMN model showing tow participant models and the interactions btwn them in a process

choreogrpahy

science of examining raw data, removing excess noise from dataset, and organizing data w/ purpose of drawing conclusions for decision making

Orchestration

BPMN sequence of activities within one pool

access control

limit who can use and change record in the system

application control

ensure data integrity and an audit trail

What is a type image

Represent management information to help manage a business process. allows process information to be summarized by category

Multiplicities indicate location of foreign keys for

one-to-many associations (primary key of one is foreign key in another)

Multiplicities indicate linking tables for

Many-to-many associations (primary key of both tables used in one table)

Business activities associated with purchasing and payments process

1. buying inventory form supplier


2. maintaining supplier records
3. making payments to suppliers for trade account payable while taking appropriate purchase discounts

Purchases and payments business process

start > request prices and availability > place purchase order > receive items > send payment > end

What is the primary objective of conversion process

generates accounting transactions to record the transfer of raw material to WIP and WIP into finished goods

Business activities associated with conversion process

1. Maintaining inventories of raw materials and finished goods
2. Producing finished good form raw material
3. tracking direct labor and direct equiptment costs
4. Apply OH

Basic Conversion Activity Model

start > authorize production > issue raw materials > perform work > complete production > end

what is an Enterprise System

centralized database that collects data throughout the firm. Integrates and automates business processes across a firm’s value chain within and across organizations.