Page 70 - Accounting Information Systems

2
chapter

Introduction to

Transaction Processing

hapter 1 introduced the transaction processing
system (TPS) as an activity consisting of three
C major subsystems called cycles: the revenue
cycle, the expenditure cycle, and the conversion cycle. Even
though each cycle performs different specific tasks and
supports different objectives, they share common character-
istics. For example, all three TPS cycles capture financial
transactions, record the effects of transactions in accounting
records, and provide information about transactions to users Learning Objectives
in support of their day-to-day activities. In addition, transac-
tion cycles produce much of the raw data from which After studying this chapter, you should:
management reports and financial statements are derived. Understand the broad objectives of
Because of their financial impact on the firm, transaction transaction cycles.
cycles command much of the accountant’s professional
Recognize the types of transactions
attention.
processed by each of the three trans-
The purpose of this chapter is to present some prelimi-
action cycles.
nary topics that are common to all three transaction process-
ing cycles. In subsequent chapters, we will draw heavily Know the basic accounting records
from this material as we examine the individual subsystems used in transaction processing sys-
of each cycle in detail. This chapter is organized into five tems.
major sections. The first is an overview of transaction proc- Understand the relationship between
essing. This section defines the broad objective of the three traditional accounting records and
transaction cycles and specifies the roles of their individual their magnetic equivalents in com-
subsystems. The second section describes the relationship puter-based systems.
among accounting records in forming an audit trail in both Be familiar with the documentation
manual and computer-based systems. The third section
techniques used for representing
examines documentation techniques used to represent sys- manual and computer-based sys-
tems. This section presents several documentation tech- tems.
niques for manual and computer-based systems. The fourth
Understand the differences between
section addresses computer-based systems. It reviews the
batch and real-time processing and
fundamental features of batch and real-time technologies
the impact of these technologies on
and their implication for transaction processing. The final
transaction processing.
section examines data coding schemes and their role in
transaction processing. Be familiar with data coding
schemes used in accounting infor-
mation systems.