Role and Purpose of Accounting Information Systems

1
Chapter 1

• Role and Purpose of Accounting Information Systems

2
Outline

• Objectives
• Definition of accounting information systems
• FASB Conceptual Framework
• Typical AIS structure
• Information competence
• Textbook structure

3
Definition of AIS

• Interrelationships
• Collection processing
• Reporting
• Decision makers

4
FASB Conceptual Framework

• Components
• Objectives
• Elements
• Assumptions, principles and constraints

5
FASB Conceptual Framework

• Objectives
• Multiple
• Decision making
• Elements
• Balance sheet
• Income statement
• Other comprehensive income

6
FASB Conceptual Framework

• Qualitative
• Primary
• Relevance
• Reliability
• Secondary
• Comparability
• Consistency

7
FASB Conceptual Framework

• Assumptions
• Economic entity
• Going concern
• Periodicity
• Monetary unit

8
FASB Conceptual Framework

• Principles
• Historical cost
• Realization
• Matching
• Full disclosure

9
FASB Conceptual Framework

• Constraints
• Cost
• Materiality
• Conservatism
• Industry practices

10
Typical AIS structure

• Inputs
• Processes
• Outputs

• Storage
• Internal controls

11
Information competence

• Non-deterministic
• Some answers are clearly incorrect
• Research
• Therefore, accountants must be able to evaluate
  information

12
What is Information competence?

• Find
• Evaluate
• Use
• Communicate information

13
Information competence

• Types of information
• Sponsored / commercial
• Popular / practitioner
• Scholarly

14
How Should Information be Evaluated?

• Criteria
• Authority
• Accuracy
• Objectivity
• Currency
• Coverage

15
Textbook structure

• Part One Introduction and Basic Concepts
• Nature and purpose of AIS
• Transaction processing
• Professionalism and ethics
• Internal control

• Part Two Systems Documentation and Information
  Technology
• Flowcharting
• Data flow diagramming and database design
• Information technology tools

16
Textbook structure

• Part Three Business Processes
• Sales / collection
• Acquisition / payment
• Other
• Human resources
• Conversion
• Financing

• Part Four Current Topics
• Application service providers
• Professional certifications
• Event-driven systems
• Computer crime and IT security
• XBRL
• Decision-making models and knowledge management
• E-business and ERP systems
• Auditing and evaluating the AIS