GROUP 2

DUEÑAS, ESAGUNDE, ESTACIO,

FRANCISCO, & GAITE
 FUNCTIONS OF AN
INFORMATION SYSTEM
Regardless of the information system
components used, the architecture or the
business task undertaken, information systems
perform five fundamental functions briefly
discussed in the succeeding presentation.
1. CAPTURE INPUT
Inputs are the data needed by the system. An
information system must provide a mechanism
to capture input. Input can come from many
different types of devices, including data entered
via a keyboard, a mouse, barcodes, RFID tags,
scanning devices, or voice-enabled applications
such as Siri and Alexa.
2. PROCESS
The transformation of input into output is called
processing. Performing Process calculations,
validating information, updating records, and
tracking raw materials are all examples of
processing.
 3. CONVEY OUTPUT
Outputs are the result of processing the data. The most
common types of output are hard copy (printed) reports,
output that is displayed electronically (on-screen), and out
that is used as input for other information systems.
4. COLLECT FEEDBACK
In order to determine whether the
system is working as planned,
feedback - data about the performance
of the system 1S collected.
 5. CONTROLS
Controls refer to the processes and procedures
that restrict and monitor input, processing and
output to provide reasonable assurance that
organizational objectives are being met, including
reliable financial reporting.
CHARACTERISTICS OF VARIOUS
TYPES OF IT-BASED SYSTEM

• Batch Processing
is a system in which like transaction are processed
periodically as a group (e.g., payroll transactions).
This system does not provide up-to-the minute or
real-time transaction information.
 • Real-time or online processing
is a system that allows immediate update or access to
data, or instantaneous analysis of data.

• Online transactions processing (OTP)

is a processing method in which the IT system
processes data immediately after it IS captured and
provide information to the uses on a timely basis. (OLTP
examples include airline reservation systems and
banking systems)
 • Designing support system
IT information system that combine models and data in
an attempt to solve non-structured problems with
extensive user involvement.

• Expert system
a computerized information system that guides decision
processes within a well-defined area and allows the
making of decision comparable to those of an expert
 • Centralized Processing System

Computer systems in which processing is performed by

one computer or by a cluster of coupled computers in a
single location. Data are often input and reports printed
using workstations. When the workstations themselves
perform significant processing, the system becomes a
client / server environment.
 • Decentralized Processing System
Computer systems in different locations. Although data may be
transmitted between the computers periodically, such a system
involves only limited communications among systems. Contrast
with distributed processing and centralized processing.
• Client/server architecture (IT architecture)
A network system in which multiple computers (clients) share
the memory and other capabilities of a larger computer (the
server), or that of printers, database, and so on.
 • Local Area Network (LAN)
A communications network that interconnects computers
within a limited area, typically a building or a small cluster
of buildings.

• Wide Area Network

A communications network that interconnects computers
within a large geographical area.
 • Cloud Computing
A model for enabling on-demand user network access to a
shared pool of computing resources (e.g., servers,
storage, applications, and services), often through a web
browser with minimal effort on the of the, user.

For example, an independent service provider may

maintain databases for a client that can be accessed in a
number of locations by client personnel.
 • Virtualized client / server infrastructure
A virtual infrastructure is a software-based IT
infrastructure being hosted on another physical
infrastructure. This type of infrastructure is used for cloud
computing.
• Electronic Data Infrastructure (EDI)
A system in which data are exchanged electronically
between the computers of different companies. In an EDI
system, source documents are replaced with electronic.
transactions created in standard format.
 AUDITOR’S
RESPONSIBILITIES
The auditor’s responsibilities with respect to internal
control over IT systems remains the same as with manual
systems, that is to obtain an adequate understanding

(1) to aid in planning the remainder of the audit and

(2) to assess control risk.
Factors such as the following may affect the study of
internal control in that computer systems may:

I. Result in transaction trails that exist for short period of

time or only in a computer readable form;

2. Include program error that cause uniform mishandling

of transactions - clerical error become less frequent;

3. Include computer controls that need to be relied upon

instead of segregation of functions;
4. Involve increased difficulty in detecting an authorized
access;

5. Allow increased management supervisory potential

resulting from more timely reports;

6. Include less documentation of initiation and execution of

transactions;

7. Include computer controls that affect the effectiveness of

related manual control procedures that use computer
output.
THANK YOU