Page 20 - Accounting Information Systems

Preface xix

In conjunction with these general approaches, professional systems analysts and pro-
grammers use a number of documentation techniques to specify the key features of sys-
tems. The modern auditor works closely with systems professionals during IT audits
and must learn to communicate in their language. The book deals extensively with
documentation techniques such as data flow diagrams (DFDs) and entity relation-
ship diagrams (ERDs), as well as system and program flowcharts. It contains
numerous systems design and documentation cases and assignments intended to
develop students’ competency with these tools.
Significant Changes in the Seventh Edition

Chapter 2, ‘‘Introduction to Transaction Processing’’
This chapter has been updated to include a discussion of data coding schemes and their
role in transaction processing and AIS as a means of coordinating and managing a
firm’s transactions. The chapter presents the advantages and disadvantages of the major
types of numeric and alphabetic coding schemes. In the sixth edition, this material was
included in Chapter 8; it was moved in this edition because of its relevance as an ele-
ment of transaction processing.

Chapter 3, ‘‘Ethic, Fraud, and Internal Control’’
This chapter has been revised to include the most recent research results published by
the Association of Certified Fraud Examiners (ACFE). The ACFE study provides esti-
mates of losses due to fraud, categorizes fraud by various factors, and creates a profile
of fraud perpetrators. In addition, the chapter presents an expanded discussion of com-
mon fraud schemes.
Chapter 4, ‘‘The Revenue Cycle’’; Chapter 5 ‘‘The Expenditure Cycle Part I:
Purchases and Cash Disbursements Procedures’’; Chapter 6, ‘‘The Expenditure Cycle
Part II: Payroll Processing and Fixed Asset Procedures’’
The end-of-chapter material for these chapters has been significantly revised. This
entailed revising all the end-of-chapter internal control cases and creating several new
ones, In particular, great attention was given to internal control case solutions to ensure
consistency in appearance and an accurate reflection of the cases in the text. In the sev-
enth edition, all case solution flowcharts are numerically coded and cross-referenced to
text that explains the internal control issues. This approach, which has been classroom
tested, facilitates effective presentation of internal control case materials.

Chapter 8, ‘‘Financial Reporting and Management Reporting Systems’’
This chapter has been revised to include a discussion of the expanding role of XBRL
(Extendable Business Reporting Language). The chapter outlines the technological fea-
tures of XBRL and points to the advantages it offers organizations for which online
reporting of financial data has become a competitive necessity. It also presents a num-
ber of internal control and audit implications that accountants should recognize.

Chapter 11, ‘‘Enterprise Resource Planning Systems’’
A significant change to this chapter has been the addition of a SAP internal control
case, available online to all schools that are members of the SAP University Alliance
Program. This case teaches students how to navigate the SAP system and allows them
to process revenue, expenditure, and conversion cycle transactions for a hypothetical
company that manufactures and sells classic sports car parts and accessories. Important
aspects of the case are its focuses on internal controls and on the establishment of roles
in a SAP environment.