AIS Final Flashcards

Terms Definitions
Systems Life Cycle
1 NF
no repeating groups
Information processes include...
recording, maintaining, reporting
represent the differences between actual costs and the standard costs applied
Basic REA Ontology
Economic Resources (R)---Economic Events (E), Commitments (C), Business Events (B)---- Internal and External Agents (A)
forensic auditing
involves audit testing designed specifically for finding and preventing fraud and is sued for companies where fraud is known or believed to exist
John Faulkner (insurance)
borrowed against client accounts..checks were sent to him to forward to clients, but he deposited them into own account
The process of using relevant information to describe characteristics of a group of customers and identify what discriminates them form other customers to determine drivers of their purchasing decisions.
Payroll module
automates accounting and preparation of payroll checks for employee salaries, wages and bonuses, calculation of various taxes and benefit deductions, and the generation of periodic payroll checks as well as various local, state and federal tax information and forms
this component of the logistics function directs the focus of operations
Discretionary fixed costs arise from annual decisions by mgmt to spend in certain fixed cost areas.True or False
Fabian Company uses the weighted-average method in its process costing system. The Assembly Dept started the month with 9,000 units in its beginning work in process inventory that were 70% complete with respect to conversion costs. An additional 90,000 u
D. 89,400
Name the outside entity associated with the expendure cycle
3 NF
2 NF + no derived fields
certified public accountants
have extensive knowledge of GAAP
adverse opinion
notes that there are material misstatements presented
Service management
ERP functionality that manges the lifecycle changes to existing services or installed products after the initial order is fulfilled.
Production Planning
ERP functionality that enables the production planner to create realistic production plans across the different manufacturing locations, including subcontractors, to fulfill demand in a timely manner and according to standards expected by the customer
Plant Maintenance
ERP functionality that helps an organization increase the availability of machinery and other fixed assets reduce the number of breakdowns through preventive maintenance, coordinate and employ human resources to fulfill specific maintenance orders, and reduce costs of inspections and preventive and planed maintenance.
Programmed controls
Automated controls within the software application such as data entry validation
Data Mining
The statistical analysis of large pools of historical data looking for correlations, trends, and patterns that may have escaped unnoticed. It is also known as knowledge discovery.
is the issuance and movement of materials into the various production phases
production orders
authorize production activities for a particular sales order of forecasted need
A mixed cost is partially variable and partially fixed.True or False
Accounting transactions are made only in what journal?
General Journal
Uniqualified opinion
states that the auditors believe the financial statements are fairly and consistently presented in accordance with GAAP
balancing tests
a comparison of different items that are expected to have the same values such as comparing two batches or comparing actual data against a predetermined control total
financial statement audits
determine whether the company has prepared and presented its financial statements fairly and in accordance with generally accepted accounting principles or some other financial accounting criteria
reasonableness test
compare the reports and other results with test data or other criteria
Business Process Risk
Risks associated with business objects (R-E, R-A, E-E, etc.)
Lean manufacturing
A manufacturing strategy that seeks to produce a high level of throughput with a minimum of inventory
Benefit Administration module
permits HR professionals to administer and track employee participation in benefits programs
Performance Management
Bolt-on to ERP that provides answers to the question, "how well are we performing right now?" It includes activities to ensure that goals are consistently being met in an effective and efficient manner.
Production System
the system that represents the "live" deployment of an ERP system
manufacturing resource planning (MRP-II)
considers all manufacturing resources, rather than focusing on materials
perpetual inventory systems
involve recording purchases as raw materials inventory, recording all the components of work-in-process for inventories in various stages of production, and recording the total cost of sales for products completed and sold
maintenance and control
is concerned with maintaining the capital resources used to support production, including production facilities and other fixed assets such as machinery, equipment, computers, and vehicles
raw materials
include the basic components of the company's products, including anything from wood, metal, and nails to finished parts purchased as subassemblies
In a scattergraph, the line fitted to the plotted points is known as a regression line.True or False
Name three outside entities associated with the financing cycle
Investors, Creditors, Banks
Computer Ethics
the analysis of the nature and social impact of computer technology and the corresponding formulation and justification of policies for the ethical use of such technology
authenticity tests
testing for valid use of the clients computer system according to the authority tables
Three factors increasing likelihood of fraud
Financial Pressure (opportunity), opportunity (internal control), integrity
Warehouse Management System (WMS)
Controls the activities of movements into, out of, and through a warehouse by using real-time information about the status of inventory supply and demand
Tacit Knowledge
This type of knowledge is contained in peoples' head and is what people know. It is knowledge gleaned from years and years of working in a particular industry and/or for a particular company
bill of materials
is the form that specifies the components of a product, including descriptions and quantities of materials and parts needed
On a per unit basis, a fixed cost varies inversely with the level of activity. True or False.
What are stewardship reports?
Required reports like tax returns & payroll filings
Generally accepted auditing standards (GAAS)
broad guidelines for an auditor's professional responsibilities
Time and Labor Management
allows workers to submit timecard data online and supervisor to review and approve time
Testing a prototype of a new product is an example of a:A. Unit-level activityB. Batch-level activityC. Product-level activityD. Organizational-sustaining activity.
C. Product-level activity
What is a control account?
The general ledger account that corresponds to a subsidiary ledger
percentage of fraud involving whom
80% involve one person; 20% involve collusion
For internal uses, managers are more concerned with receiving information that is:A. completely objective and verifiable.B. completely accurate and precise.C. relevant, flexible, and immediately avaliable.D. relevant, completely a
C. relevant, flexible, and immediately available.
What are the transaction events for the expenditure cycle
purchases and cash disbursement events
Central Processing Unit (CPU) 3 Parts
1. Arithmetic-logic unit - does the actual computation, 2. Control Unit (synchronizes the internal clock), 3. Register - is a high speed memory location inside te CPU
An opportunity cost:A. the difference in total costs which results from selecting one alternative instead of another.B. the benefit forgone by selecting one alternative instead of another.C. a cost which may be saved by not adopting an
B. The benefit forgone by selecting one alternative instead of another.
Name five special forms, coding and summation processes developed for data storage
Ledgers, Coting techniques, Charts of Accounts, journals, audit trails
The term "relevant range" means the range over which:A. costs may fluctuateB. A particular cost formula is validC. production may varyD. relevant cost is incurred.
B. A particular cost formula is valid.
What is the purpose of special journals?
To make recording large number of repetitive transactions more efficient
At an activity level of 10,000 units, variable costs totaled 35,000 and fixed costs totaled 20,800. If 16,000 units are produced and this activity is within the relevant range, then:A. total costs would equal 89,280B. total unit cost would eq
B. total unit cost would equal 4.80
Document flowcharts; systems flowcharts; program flowcharts
information traditionally found in journals is store din which type of entity in an rea database
The structure where ovum develop
performance reports
compare standard, or expected, performances with actual performance
conceptual, external, internal
three levels of schemas
remittance advice
the documentation accompanying payment that identifies the customer account number and invoice to which the payment applies
1995 COBIT
Best practices in controlling IT.
Cash Disbursements Journal
Records transactions involving disbursements of cash. DR: A/P CR: Checking (cash)
Delete anomaly
unintended results occur when you delete a row in a table
Online Controls
online data entry should be facilitated where possible.
systems approach
problems and alternatives are viewed from entire organization standpoint
Routing slip
prepared to document the description and quantities of materials taken into production for a specified sale or other production activity
Sales returns: credit customers using a:
Credit memo
Refers to an approval, or endorsement, from a responsible person or department in the organization that has been sanctioned by top management.
Cheyenne Life cycle
Very male dominated
Male gained status in war performance
Status depends on how many horses owned, behavior
production order
authorizes the manufacture of a specified quantity of a particular product
a process that takes plaintexts of any length and transforms it into a short code called hash
fraudulent financial reporting
intentional or reckless conduct that results in materially misleading financial statements
corporate governance
an elaborate system of checks and balances whereby a company's leadership is held accountable for building shareholder value and creating confidence in the financial reporting process (elaborate system of checks and balances)
stateful packet filtering
type of filtering employed by firewalls
Logical View
Represents how the users organize and see the data
Document flowcharts
describe the flow of documents and information between departments or units
Risk assessment
Existing threats and the potential for additional risks are assessed and management stands ready to respond should these events occur.
The hormone that causes the cervix to fill with cervical fluid
Control Risk
risk that a material misstatement will get through the internal control structure and into the financial statements
Attendance time records
Show the time periods that employees are in attendance at the job site and available for work
shoulder surfing
listening to someone as they give out confidential information to another
securities exchange act of 1934
requires ongoing disclosures for registered companies as well as regulation of stock exchanges, brokers, and dealers
Foreign Key
A column (atribute) in one table that serves as teh primary key in another table (to link them together)
Section 404 Requirements
Evaluate the design of the company's controls to determine if they adequately address the risk that a material misstatement of the financial statements would not be prevented or detected in a timely manner. Gather and evaluate evidence about the operations of its controls. The nature and extent of this evidence is to be aligned with its assessments of the risk associated with those controls. Present a written assessment of the effectiveness of internal control over financial reporting.
closed-loop verification
checks the accuracy of input data by using it to retrieve and display other related information
Efficient employment of resources
People and computers are the resources found in most business processes
disadvantages of real-time systems
the hardware and software are more expensive than those used for batch systems
a single database that is shared is more susceptible to unauthorized access of data, unless extensive controls are implemented to prevent unauthorized access
real-time systems can be difficult to audit because of the complexity of the system
Primary Value Chain Activities (5)
1.  Inbound Logistics - receiving, storage + distribution the material used to make a prod)
2.  Operations - activities related to transforming the mat into a prod
3.  Outbound Logistics - activities related to getting teh prod/service to customers
4.  Marketing + Sales
5.  Service
What are some details about exhaustive?
it is systematic
Unprocessed nodes are never removed
what is and what is not important in a given set of circumstances
What are some ways to control spreadsheet use?
-Protect the spreadsheet-Proper layout (ie. input worksheet, etc)-Test/audit spreadsheet-monitor spreadsheet size
ERM - Internal Environment (3 things)
the environment in which employees operate (most important component)  Consists of:
1.  Management style + philosophy
2.  Board of Directors + Audit Committee
3.  HR standards
The post partum period for a mature cow should last
30 to 45 days
individual project plans by project teamsmaster plan by info systems steering committee
two types of systems development plans needed
Sales Order Entry (4 steps)
1.  Check the Customers Order - Sales Dept - Complete a sales order document
2.  Check the Customers Credit
3.  Check Inventory availability (and generate picking ticket)
4.  Respond to Customer Inquiries (customer service dept)
What are the 2 ways of designing a database
1) Normalization2) Semantic data modeling
What are 3 reasons to learn SQL
1) Not all businesses use Access2) Not all queries can be created using QBE3) SQL can help you to troubleshoot QBE queries
Time Based Model of Security (letters, defs, formula)
P = time it takes an attacker to break through the preventive controls
D = Time is takes a company to realize an attack is underway
C = Time it takes to respond to the attack
IF P>D+C the security procedures are effective
Types of Agents

transforming ciphertext back into plaintext
narratives, flowcharts, diagrams and other written materials that explain how a system works
selecting a course of action
Written Approvals
Documents should require authorized signatures prior to being input and processed.
Research & Development
focus on product improvement
Personnel Development
Training and education, performance evaluations.
In the ______ origin story, water-beetle dives to the bottom of the ocean to scoop mud up
social engineering
using deception to obtain unauthorized access to information resources. Access is usually obtained by fooling an employee
white-collar criminals
typically business people who commit fraud
behavior that is usually intended to destroy, cripple, or weakens the systems effectiveness
certificate authority
the organization that issues public and private keys and records the public key in digital certificate
receiving log
lists the chronological sequence of all returned items
two or more computers linked together to share information and/or resources
The ideal body condition score for cows during breeding season
system requests each input data item and waits for an acceptable response
Input validity
Valid time data include those that reflect services performed by real employees
5 major business or transaction cycles
revenue cycleexpenditure cycleproduction cyclehuman resources/payroll cyclefinancing cycle
Receive Goods
Handle the goods sent by supplier's Shipping Function
data dictionary
ensures that data items are defined and used consistently
provides a means to verify that the contents of a m message haven't been altered
electronic data interchange systems
systems communicate sales documents electronically with a standard business format
one item within a record (for example, a last name)
8 components of ERM framework
Internal Environment, Objective Setting, Event Identification, Risk Assessment, Risk Response, Control Activities, Information and Communication, and Monitoring.
Blue Gene Artificial Brain
IBM's artificial braincomputing power of a cat's brain, but only 1/83 as fast as a human brain
Production Cycle
a recurring set of business activities and related information processing operations associated with the manufacture of products
relational database
a set of tables used to store data
One-for-One Matching
comparison of two or more documents on corresponding data elements.
fourth stage/implementation and conversion
includes all the activities associated with transferring data from existing systems to the new database AIS, testing the new system,, and training employees how to use it
cash receipts journal
a special journal that records all cash collections
random access files
not written or read in sequential order; stored in random order on disk media
The post partum period for first time cows (heifers) should be
60-90 days
process costing
assigns costs to each process, or work center, in the production cycle, and then calculates the average cost for all units produced
data definition language (DDL)
used to build the data dictionary, intialize or creaete the database,dsecribe the logical views for each individual user or programmer, andspecify any limitaion or contratins on security imposed on database recoreds or fields
Expenditure Cycle - 3 main things
1.  Order Inventory (materials, supplies, etc)
2.  Receive the goods from vendor
3.  cash payment for the goods
2001 SAS No. 94
Addresses impact of IT on Internal Control.
What are decision Tables?
a table of conditions and processing tasks that indicates what action to take for each possibility.
Who does SOX apply to?
public companies and the auditors of public companies
leaving sales open
is a term that refers to moving a period cut-off date forward to include sales that rightly would occur in a future period
What should you know about spreadsheet documentation?
When documenting spreadsheets this info should be included: Name of the developer, name of the file, directories and subdirectories where the application is stored, date the application was developed, date the app was modified and name of person who did i
Major Problems with the Time Based Model of Security (2)
1.  It's virtually impossible to accurately estimate P,D, and C
2.  Even if they are estimated, the estimates are valid for a very short period of time
(so use Defense in Depth for day to day)
ERP enterprise resource planning system
software packages that can be used for the core system necessary to support enterprise systems.
Processing Integrity (def + 5 cats)
relates to the ability of the system to provide accurate + timely information based only on authorized transactions
1.  Source Document Controls - how data is initially recorded (POs + invoices)
2.  Data Entry Controls - entering data from source docs into teh system
3.  Data Processing Controls - processing of data
4.  Data Transmission Controls - encryption
5.  Output Controls - output...
Sales Order Entry -
How can IT make customer orders more efficient?
(2 + why?)
1.  Use websites - have customer enter own data,
mitigates user error and potential for increased sales through personal marketing (Amazon)
2.  Use a Choice Board - an interactive sales order entry system allowing each customer to customize the product to meet their needs (Dell)
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