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BIS309 Lecture 3 Transaction Processing Systems
BIS309 Lecture 3 Transaction Processing Systems
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AN OVERVIEW OF TRANSACTION
PROCESSING
A financial transaction is an economic event that affects the
assets and equities of the firm, is reflected in its accounts, and
is measured in monetary terms.
Three transaction cycles: the expenditure cycle, the conversion
cycle and the revenue cycle. Every business:
Incurs expenditures in exchange for resources (expenditure cycle).
Provides value added through its products or services (conversion
cycle).
Receives revenue from outside sources (revenue cycle).
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AN OVERVIEW OF TRANSACTION
PROCESSING
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AN OVERVIEW OF TRANSACTION PROCESSING
Expenditure Cycle: Time lag between components due to
credit relationship with suppliers.
physical component (acquisition of goods)
financial component (cash disbursements to the supplier)
Conversion Cycle:
the production system (planning, scheduling, and control of the
physical product through the manufacturing process)
the cost accounting system (monitors the flow of cost information
related to production)
Revenue Cycle: Time lag between components due to credit
relationship with customers.
physical component (sales order processing)
financial component (cash receipts)
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ACCOUNTING RECORDS: MANUAL SYSTEMS
Source documents are used to capture and formalize
transaction data needed for transaction processing.
Product documents are the result of transaction
processing.
Turnaround documents - product documents of one
system that becomes source documents for another.
Journals are chronological records of transactions.
Special journals are used to record specific classes of
transactions that occur in high frequency.
Register denotes certain types of special journals.
General journal is used to record nonrecurring, infrequent, and
dissimilar transactions.
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ACCOUNTING RECORDS: MANUAL
SYSTEMS
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ACCOUNTING RECORDS: MANUAL
SYSTEMS
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ACCOUNTING RECORDS:
MANUAL SYSTEMS
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ACCOUNTING RECORDS: MANUAL SYSTEMS
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ACCOUNTING RECORDS: MANUAL SYSTEMS
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ACCOUNTING RECORDS: MANUAL
SYSTEMS
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ACCOUNTING RECORDS: MANUAL SYSTEMS
Ledger is a book of accounts that reflects the financial
effects of a firm’s transactions as they are posted from the
various journals.
General ledgers contain account information in highly
summarized control accounts.
Subsidiary ledgers contain details for each 0f the individual
accounts that constitute a particular control account.
Together the accounting records provide an audit trail for
tracing account balances contained in the financial
statements back to the source documents and events that
created them.
Important in the conduct of a financial audit.
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ACCOUNTING RECORDS: MANUAL SYSTEMS
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ACCOUNTING RECORDS:
MANUAL SYSTEMS
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ACCOUNTING RECORDS: MANUAL SYSTEMS
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ACCOUNTING RECORDS: MANUAL
SYSTEMS
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DIGITAL ACCOUNTING RECORDS
Master file contains account data.
Transaction file is a temporary file of transaction records
used to update data in a master file.
Reference file stores data that are use as standards for
processing transactions.
Archive file contains records of past transactions retained
for future reference
Form an important part of the audit trail.
Digit record audit trails are less observable than those between
hard-copy documents, but they still exist.
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DIGITAL ACCOUNTING RECORDS
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