Page 294 - Accounting Information Systems

6
chapter

The Expenditure Cycle

Part II: Payroll Processing

and Fixed Asset

Procedures

his chapter is divided into two major sections. The
first section begins with a conceptual overview of Learning Objectives
T the payroll process emphasizing logical tasks, key
After studying this chapter, you should:
entities, sources and uses of information, and the flow of
key documents through an organization. We illustrate these Recognize the fundamental tasks
features first with a manual system and then consider the that constitute the payroll and fixed
operational and control issues related to computer-based asset processes.
alternatives. The second section examines fixed asset sys- Be able to identify the functional
tems. Fixed assets are the property, plant, and equipment departments involved in payroll and
used in the operation of a business. This discussion focuses fixed asset activities and trace the
on processes pertaining to the acquisition, maintenance, and flow of these transactions through
disposal of its fixed assets. Finally, we illustrate these con- the organization.
cepts with a real-time example. Be able to specify the documents,
journals, and accounts that provide
audit trails, promote the mainte-
nance of historical records, and sup-
port internal decision making and
financial reporting.
Understand the exposures associ-
ated with payroll and fixed asset
activities and recognize the controls
that reduce these risks.
Be aware of the operational features
and the control implications of tech-
nology used in payroll and fixed
asset systems.