Page 129 - Accounting Information Systems

100 PART I Overview of Accounting Information Systems

21. Distinguish between the sequential file and data- 31. In one sentence, what does updating a master file
base approaches to data backup. record involve?
22. Is a data flow diagram an effective documentation 32. Comment on the following statement: ‘‘Legacy
technique for identifying who or what performs a systems always use flat-file structures.’’
particular task? Explain. 33. Explain the technique known as destructive
23. Is a flowchart an effective documentation tech- update.
nique for identifying who or what performs a par- 34. What factor influences the decision to
ticular task? Explain. employ real-time data collection with batch
24. How may batch processing be used to improve updating rather that purely real-time processing?
operational efficiency? Explain.
25. Why might an auditor use a program flowchart? 35. What are the advantages of real-time data proc-
26. How are system flowcharts and program flow- essing?
charts related? 36. What are the advantages of real-time data collec-
27. What are the distinguishing features of a legacy tion?
system? 37. What are some of the more common uses of data
28. What are the two data processing approaches codes in accounting information systems?
used in modern systems? 38. Compare and contrast the relative advantages and
29. How is backup of database files accomplished? disadvantages of sequential, block, group, alpha-
betic, and mnemonic codes.
30. What information is provided by a record layout
diagram?

Discussion Questions

1. Discuss the flow of cash through the transaction 11. Discuss why an understanding of legacy system
cycles. Include in your discussion the relevant sub- technologies is of some importance to auditors.
systems and any time lags that may occur. 12. If an organization processes large numbers of
2. Explain whether the cost accounting system pri- transactions that use common data records, what
marily supports internal or external reporting. type of system would work best (all else being
3. Discuss the role of the conversion cycle for ser- equal)?
vice and retailing entities. 13. If an organization processes transactions that have
4. Can a turnaround document contain information independent (unique) data needs, what type of sys-
that is subsequently used as a source document? tem would work best (all else being equal)?
Why or why not? 14. Explain how a hashing structure works and why
5. Would the writing down of obsolete inventory be it’s quicker than using an index. Give an example.
recorded in a special journal or the general jour- If it’s so much faster, why isn’t it used exclusively?
nal? Why? 15. Describe a specific accounting application that could
6. Are both registers and special journals necessary? make use of a virtual storage access method file.
7. Discuss the relationship between the balance in 16. Explain the following three types of pointers: phys-
the accounts payable general ledger control ical address pointer, relative address pointer, and
account and what is found in the accounts payable logical key pointer.
subsidiary ledger. 17. Should an auditor wishing to assess the adequacy
8. What role does the audit trail play in the task of of separation of functions examine a data flow dia-
confirmation? gram or a system flowchart? Why?
9. Explain how the magnetic audit trail functions. 18. Discuss some of the problems associated with
general ledger systems that do not have data cod-
10. Are large batch sizes preferable to small batch
ing schemes.
sizes? Explain.