311 midterm notes(2)

311 midterm notes(2) - Acct 311 Study Notes for Chapters 1...

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Acct 311 Study Notes for Chapters 1 through 4 Chapter 1 Explain the three basic information flows (Figure 1-1). Performance information from operations personnel to middle and upper management Budget information and instructions from top management downwards Day to day operations information (horizontal) Top management reports to stakeholders Operations information flows to suppliers and customers Study information systems framework (Figure 1-3). System – group of two or more interrelated components or subsystems that serve a common purpose Information system – set of formal procedures by which data are collected, processed into information, and distributed to users Transaction – an event that affects or is of interest to the organization and is processed by its information system as a unit of work Financial transaction – an economic event that affects the assets and equities of the organization, is reflected in its accounts, and is measured in monetary terms Accounting Information System (AIS) – process financial and non financial transactions that directly affect the processing of financial transactions AIS is composed of three major subsystems: Transaction processing system (TPS) o Supports daily operations with reports, documents, and messages General Ledger/financial reporting system (GL/FRS) o Produces financial statements Management reporting system (MRS) o Provides internal management with special-purpose financial reports and information needed for decision making such as budgets and reports
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Management Information System (MIS) – processes nonfinancial transactions that are not normally processed by AIS. Examples include Finance, marketing, distribution, and personnel systems Study the general model for AIS (Figure 1-5). Distinguish between data and information. Data – facts, which may or may not be processed and have no direct effect on the user Information – causes the user to take an action that he otherwise could not or would not have taken Define the levels of the data hierarchy. Data Hierarchy - Attribute -> Record -> File Database Management Tasks Storage Retrieval Deletion Characteristics of information : Relevance o Contents of a report or document must serve a purpose Timeliness o Information must be no older than the time period of the action it supports Accuracy o Information must be free from material errors Completeness o No piece of information that is essential to a decision or task should be missing Summarization o Information should be aggregated in accordance with the users needs
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Information System Objectives To support the stewardship function of management To support management decision making To support the firm’s day to day operations Types of Information Systems Turnkey systems o Completely finished and tested systems that are ready for implementation Backbone systems o Basic system structure on which to build Vendor supported system
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This note was uploaded on 03/27/2008 for the course ACCT 311 taught by Professor Staff during the Spring '08 term at Lehigh University .

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311 midterm notes(2) - Acct 311 Study Notes for Chapters 1...

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