ACCOUNTING INFORMATION SYSTEMS The Crossroads of Accounting IT

What is the Objective of the Accounting System? To provide information for decision making.

How Do I Navigate the Crossroads of Accounting and IT? In today’s business environment,

How Do I Navigate the Crossroads of Accounting and IT? Store accounting data using

Your Roadmap to AIS © Copyright 2012 Pearson Education. All Rights Reserved.

Accounting System Three aspects to the accounting system: Store accounting data Analyze accounting data

How Is the Accounting System Related to the Enterprise System? Activities in an enterprise

Integrated Enterprise System An integrated enterprise system shares data across functional areas within the

Enterprise System Modules or subsystems of an enterprise system can include: Accounting Supply Chain

Enterprise System Three functions of an enterprise system are: Input: capturing information to store

Accounting System Three functions of an accounting system are: Input: capture accounting information about

Business Processes To understand an enterprise system, first you must understand the underlying business

Value Chain Value chain is a series of activities that create value. Innovation includes

Business Processes & Transaction Cycles The accounting system spans the value chain. Business processes

© Copyright 2012 Pearson Education. All Rights Reserved.

Baseline Accounting System © Copyright 2012 Pearson Education. All Rights Reserved.

Baseline Accounting System with Transactions © Copyright 2012 Pearson Education. All Rights Reserved.

Baseline Accounting System with Transaction Cycles © Copyright 2012 Pearson Education. All Rights Reserved.

All 3 Categories of Accounting Software Use Databases © Copyright 2012 Pearson Education. All

Database Essentials Fields: pieces of information about events, people, and objects Record: collection of

Database Fields & Records Fields are shown in columns Records are shown in rows.

Spreadsheets Spreadsheet as a 2 -dimensional database © Copyright 2012 Pearson Education. All Rights

Database Tables in 3 -D © Copyright 2012 Pearson Education. All Rights Reserved.

Database Essentials Relational Database: database tables are related or connected through fields common to

Relational Database Primary Key Customer Table with Primary Key Order Table with Primary Key

Database Essentials Database Forms: onscreen forms used for database input, such as onscreen checks

From Data To Intelligence Transforms data to intelligence for better decision. Data: The amount

Business Intelligence Two general approaches to business intelligence: Shadow Data: Often consists of “homegrown”

3 Keys of Opportunity People: What is the impact of the opportunity on people?

3 Keys of Opportunity Pair and Share: Share with a classmate your response to

Slides: 41

Download presentation

What is the Objective of the Accounting System? To provide information for decision making. . . Should I buy more stock? Investors Creditors Should I make a loan? Should we raise prices? Management Does this company comply? External agencies (IRS, SEC and so on) Society and Community Is this enterprise socially responsible? © Copyright 2012 Pearson Education. All Rights Reserved.

How Do I Navigate the Crossroads of Accounting and IT? In today’s business environment, the accounting professional stands at the crossroads of accounting and information technology. Having IT knowledge gives you a competitive advantage as an accounting professional. © Copyright 2012 Pearson Education. All Rights Reserved.

How Do I Navigate the Crossroads of Accounting and IT? Store accounting data using people, processes, and technology. Analyze accounting data to create intelligence for decisions. Safeguard information assets stored in the accounting system using security, controls, and risk management. System design to plan and build an accounting system. © Copyright 2012 Pearson Education. All Rights Reserved.

How Is the Accounting System Related to the Enterprise System? Activities in an enterprise are often interconnected, such as human resources and accounting working together to create your paycheck. An enterprise system supports people conducting business activities throughout the enterprise. © Copyright 2012 Pearson Education. All Rights Reserved.

Integrated Enterprise System An integrated enterprise system shares data across functional areas within the enterprise (HR, Accounting, and so on). © Copyright 2012 Pearson Education. All Rights Reserved.

Enterprise System Modules or subsystems of an enterprise system can include: Accounting Supply Chain Management (SCM) Operations/Production System (OPS) Human Resource Management (HRM) Customer Relationship Management (CRM) © Copyright 2012 Pearson Education. All Rights Reserved.

Enterprise System Three functions of an enterprise system are: Input: capturing information to store Process: sorting and storing information Output: summarizing information to generate reports © Copyright 2012 Pearson Education. All Rights Reserved.

Accounting System Three functions of an accounting system are: Input: capture accounting information about transactions Process: sort and store accounting information Output: summarize information to generate financial reports, such as a balance sheet. © Copyright 2012 Pearson Education. All Rights Reserved.

Business Processes To understand an enterprise system, first you must understand the underlying business processes. Business processes are related activities performed by an enterprise to create value by transforming input into output. The enterprise value chain is an organizing framework for business processes. © Copyright 2012 Pearson Education. All Rights Reserved.

Business Processes & Transaction Cycles The accounting system spans the value chain. Business processes in the value chain are associated with related accounting transactions known as transaction cycles: 1. Purchasing cycle 2. Payroll cycle 3. Sales cycle © Copyright 2012 Pearson Education. All Rights Reserved.

Database Essentials Fields: pieces of information about events, people, and objects Record: collection of related fields Table: collection of related records with a unique table name Database: collection of related tables © Copyright 2012 Pearson Education. All Rights Reserved.

Database Essentials Relational Database: database tables are related or connected through fields common to two or more tables Primary Key: a unique identifier for each record in a database table © Copyright 2012 Pearson Education. All Rights Reserved.

Database Essentials Database Forms: onscreen forms used for database input, such as onscreen checks Database Queries: used for database searches and inquiries Database Reports: used for database output either onscreen or printout © Copyright 2012 Pearson Education. All Rights Reserved.

From Data To Intelligence Transforms data to intelligence for better decision. Data: The amount of a single sale of an Apple computer would be accounting data. Information: Apple’s income statement for the year showing sales by type of customer would be information. Which customers purchased what products last year? Intelligence: Financial analytics and predictive modeling that allows Apple to predict the number of customers who will purchase a new product. Which customers will purchase what products next year? © Copyright 2012 Pearson Education. All Rights Reserved.

Business Intelligence Two general approaches to business intelligence: Shadow Data: Often consists of “homegrown” spreadsheets. Business Intelligence Technologies: Software applications that perform data mining and predictive analytics. © Copyright 2012 Pearson Education. All Rights Reserved.

3 Keys of Opportunity People: What is the impact of the opportunity on people? Processes: What is the impact of the opportunity on processes? Technology: How will the opportunity impact technology? © Copyright 2012 Pearson Education. All Rights Reserved.

3 Keys of Opportunity Pair and Share: Share with a classmate your response to the following: How can you use three keys to triage an issue or opportunity that you are currently facing? People Processes Technology © Copyright 2012 Pearson Education. All Rights Reserved.