Page 63 - Accounting Information Systems

34 PART I Overview of Accounting Information Systems

The final section of this chapter examined three roles of Auditing is an independent attestation performed by the
accountants as (1) users of AIS, (2) designers of AIS, and (3) auditor, who expresses an opinion about the fairness of a
auditors of AIS. In most organizations, the accounting function company’s financial statements. Both external and internal
is the single largest user of the AIS. The IT function is respon- auditors conduct IT audits. The IT auditor attests to the
sible for designing the physical system, and the accounting effectiveness of a client’s IT controls to establish their degree
function is responsible for specifying the conceptual system. of compliance with prescribed standards.

Key Terms

accounting information systems (AIS) (3) general model for viewing AIS applications (10)
agents (29) independence (19)
assurance services (33) information (11)
attest function (32) information flows (4)
auditing (32) information generation (13)
auditor (33) information system (7)
backbone systems (15) internal auditing (33)
centralized data processing (20) IT auditing (33)
conceptual system (32) legacy systems (25)
currency of information (25) management information system (MIS) (9)
data (11) management reporting system (MRS) (9)
data collection (12) nonfinancial transactions (7)
data processing (12) physical system (32)
data sources (11) REA (28)
data storage (25) relational database model (28)
data updating (25) reliability (19)
database (12) resources (28)
database management (13) segments (15)
database management system (DBMS) (27) stakeholders (5)
database model (27) subsystem (5)
database tables (28) system (5)
distributed data processing (DDP) (22) system development life cycle (14)
end users (10) task-data dependency (26)
enterprise resource planning (ERP) (31) trading partners (5)
events (29) traditional systems (28)
feedback (14) transaction (7)
financial transaction (7) transaction processing system (TPS) (9)
flat-file model (25) turnkey systems (15)
general ledger/financial reporting system (GL/FRS) (9) vendor-supported systems (15)

Review Questions

1. What are the four levels of activity in the pyramid 5. What is the relationship among data, information,
representing the business organization? Distin- and an information system?
guish between horizontal and vertical flows of 6. Distinguish between AIS and MIS.
information.
7. What are the three cycles of transaction process-
2. Distinguish between natural and artificial systems. ing systems?
3. What are the elements of a system? 8. What is discretionary reporting?
4. What is system decomposition and subsystem 9. What are the characteristics of good or useful
interdependency? How are they related? information?