Chapter 1 Introduction To Accounting Information System
Chapter 1 Introduction To Accounting Information System
Chapter 1 Introduction To Accounting Information System
ACCOUNTING
INFORMATION SYSTEM
(AIS)
Objectives:
i. Definition of AIS
ii. Objective of AIS
iii.Role of accountants in AIS
iv.Comparisons between manual and computer
based system ( in terms of accounting records and
processing)
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Definition of AIS
“ A unified structure within an entity (such a
business firm) that employs physical resources and
other components to transform economic data into
accounting information, with the purpose of
satisfying the information needs of a variety of
users”
* The system of records a business keeps to maintains its accounting system.
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Objectives of AIS
1. To support the day to day operation.
2. To support decision making by internal decision
makers.
3. To fulfill obligations relating to stewardship.
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1.To support the day to day operation.
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2.To support decision making by internal
decision makers.
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3.To fulfill obligations relating to stewardship.
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Users of AIS
• Management
• Employee
• Government
• Supplier
• Customer
• Bankers
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Benefits of having computerized
AIS
1. Information can be prepared on time.
2. Produce more accurate and presentable accounting
information.
3. Information can be accessed or retrieved quickly and
timely.
4. In the long run, save time and cost in the preparation
and safe keeping of information.
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Role Of Accountants In AIS
• Accountants as System Users
As the end users, accountants must provide a clear
pictures of their needs to the designers of their
system
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Accountants as System
Designers
• The accountant function is responsible for the
conceptual system, while the programmer function is
responsible for the physical system.
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Accountants as System
Auditors
• Form opinions based on a systematic process.
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Comparisons Manual Vs
Computer Based System
1. Accounting records
2. Processing
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1. Accounting record:
Manual Vs Computer Based Systems
Manual system Computer based system
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Manual System Accounting
Records
• Source Documents - used to capture and formalize
transaction data needed for transaction processing
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Computer Files
• Master File - generally contains account data. Data values in
master files are updated from transactions. (e.g., general ledger
and subsidiary file)
• Transaction File - a temporary file holding transaction records that
will be used to update data in a master file. (e.g: Sales orders,
inventory receipts, and cash receipts.)
• Reference File - stores data that are used as standards for
processing transactions. (e.g: the payroll program may refer to a
tax table to calculate the proper amount of withholding taxes for
payroll transactions, Price lists used to prepare customer invoices,
lists of authorized suppliers and customer credit files for approving
credit sales.)
• Archive File - An archive file contains records of past transactions
that are retained for future references. (e.g: journals, prior-period
payroll information, list of former employees, records of accounts
written off, etc.)
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Audit Trail
Source General Financial
Journal
Document Ledger Statements
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Computer based system:
Batch System Vs Real Time System
Distinguish Data processing methods
characteristic
Batch system Real time system
Information time frame Lag exists between time when Processing take place
the economic events occurs and when the economic
when it is recorded events occurred
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Sources:
i. http://highered.mcgrawhill.com/sites/0074711407/stud
ent_view0/powerpoint_slides.html
ii. http://www.swlearning.com/accounting/hall_01/hall_01
.html
iii. http://www.wiley.com/college/acc/wilkinson253529/site
/index.html
iv. http://wps.prenhall.com/bp_romney_ais_9/2/608/1558
41.cw/index.html
v. http://wps.prenhall.com/bp_romney_ais_11/86/22157/
5672205.cw/-/t/index.html
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