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Inf Sys-3

Inf Sys-3

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Published by Mohd Rafeeq

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Published by: Mohd Rafeeq on Jan 10, 2011
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08/01/2013

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AZAD College
INFORMATION SYSTEMS
By:
M Rafeeq
Chapter- III
APPLICATION OF INFORMATION SYSTEMSRole of Accounting Transaction Processing System: -
Transaction processing is a major function of the accounting system. Theaccounting system collects data throughout the company and produces consolidatedreports that are used for planning and Mgt.TPS is important, because they focus on money.Provide controls over the data to ensure accuracy and to prevent fraud, and createstandard reports.
1). INPUT AND OUTPUT: -
Financial data and reports.1
 
Management
ShareholdersBanks & CreditorsProduce Mgt.accounting reportsCash Mgt.Investmentsforeign exchangeStrategic& Tactical planningProduceshareholdersreportsGovtsDepartments& EmployeesPayroll &employee benefitsOrder &account payableInventory Mgt.And fixed asset andcost accountingSales &accountreceivableTax filings &Planning
Supply andin-process inventory
ProductinventorySuppliersCustomersSalestaxInventory& Assets
 
AZAD College-Accounting department collects raw financial data and is stored in accounting journal.-Double-entry system is used to ensure accurate data. Double-entry system means,at least two entries must occur for every transaction.-Each entry includes the data, amount of money, account number, person’s name.-The journal purpose is to record all the transactions.-A general ledger is a collection of accounts include categories like accountsreceivable, accounts payable, inventory and cash.-Produce balance sheets; cash statements and income statements every quarterly.-Reports are produced to compare the financial positions of various companiesover time.-Accounting systems produce standardized reports.
2). PURCHASES, SALES, LOANS AND INVESTMENTS: -
-Purpose of accounting is to record the financial transactions with externalorganizations. Creates summary and detail reports to monitor key information.-If sales in a region drops, then there will be a major increase in the cash balance,then a message will be send to the appropriate manager by building exceptionreports.
3). INVENTORY: -
-Inventory control consists of knowing exactly what items are available andwhere they are located.-Determine when to place new orders.For E.g. With EDI, inventory control system can monitor current sales andautomatically place orders with the supplier.-The computer system monitors production requirements, keeps track of deliversand electronically sends order to the suppliers. The suppliers then deliver the parts, as they are needed on the production line.
4). THE ACCOUNTING CYCLE: -
-Produce information in reports that are required to reflect the financial conditionof the firm at the end of every quarter.-Managers operate for quarterly reports, with intermediate monthly reports for some items. The volume of data is kept on file by making summary reports.
5). PROCESS: -
Checks and Balances.a) Double-Entry System: - Objective of accounting system is to maintain theintegrity of the financial data.The goal is to prevent mistakes and discourage fraud, i.e., if an amountentered is incorrect, the account totals will not balance.Generally transactions involve outside organizations, mistakes can becaught by sharing data.For E.g.: - Companies typically send receipts, when they receive paymentsfrom each other. Auditors periodically send verification requests to suppliers andcustomers to make sure that data was recorded correctly.2
 
AZAD College b) Separation of duties: -This control is to minimize fraud to deal with multiple employees.c) Audit trails: -This is important because it enables investigators to track backward throughthe data to the source.By audit trails entries can identify the person who is responsible for the entry.This identified data, is possible to list every article that affects an item on areport.
I. Nature of Operational Information Systems: -
The information systems that perform or support the completion of tasksare often referred to as operational information system or transaction processingsystems.Operational information describes past activities.They produce routine, repetitive, descriptive, expected and object data.[Structured format].Information produced is in detail, highly structured, accurate because thisinformation is obtained from internal sources.
Advantages:
1.Reduced cost2.Increase speed.3.Increased accuracy.4.Increased custom service5.Increased data for decision-making.
Application of Information Technology to some of the OperationalInformation Systems that common to four organizational functions: -
1.Accounting/Finance.2.Marketing3.Production.4.Human Resource management.
OPERATIONAL FINANCE ACCOUNTING SYSTEMS: -
They focus on processing financial transactions to produce the routine,repetitive information outputs i.e., pay-slips, checks to vendor, customer invoices, purchase order, stock reports.3

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