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Chapter 11The Accounting Information SystemMANAGEMENT
INFORMATION SYSTEMS 8/ERaymond McLeod, Jr. and George
SchellCopyright 2001 Prentice-Hall, Inc.11-*
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What is Data Processing?Manipulation or transformation of
symbols for the purpose of increasing their usefulness.Data
processing (DP) and transaction processing (TP) are often used
interchangeably.Applied to business data
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Accounting Information Systems (AIS)Gathers data describing a
firms activityTransforms data into informationMakes information
available to users inside and outside the firm
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EnvironmentA Model of an Accounting Information
SystemInformationDataManagementDataprocessingsoftwareTransformAccountingInformationSystemDatabaseOutputphysicalresourcesEnvironment11-*
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Data Processing Tasks1. Gather dataEach transaction is
documentedWhat happened?When did it happen?How much (volume,
value)?Transactions describe11-*
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2.Manipulate data Classify (use codes) Sort Calculate
SummarizeData Processing Tasks [cont.]11-*
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3. Store data Describes each transactionRepresents most of the
databaseData Processing Tasks [cont.]11-*
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4. Document preparationTriggersBy an actionBy a time
scheduleHardcopy or on-screenData Processing Tasks [cont.]11-*
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Characteristics of the AISPerforms necessary tasksStandard
proceduresDetailed dataHistorical focusProvides minimal
problem-solving information
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Sample AISThe Distribution SystemUsers
Manufacturers Wholesalers RetailersGeneral in natureUsed in many
different types of firms
RetailersManufacturing Service 11-*
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DFDsData flow diagram
Document a system in a hierarchical mannerData flows, processes,
environmental elementsContext level is overall system within
environmentLeveled and Balanced DFDs
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CustomersManagementDistributionsystemSuppliersSales
ordersRejectedsalesordernoticesInvoicesStatementsPayments by
customersCommitmentsPurchases ordersShipmentsSupplier
invoicesSupplier statementsPayments to suppliersStockOther
reportsBudget reportsBalancesheetIncome statementA Context Diagram
of the Distribution System11-*
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CustomersSales OrdersRejected sales order
noticesInvoicesStatementsPayments by customersReceivables ledger
data 1. Fill OrdersInventory ledger dataPayables ledger dataOther
reportsBudget reportsBalancesheet IncomestatementManagementReceived
itemsPurchasing dataCommitmentsPurchase Orders
2.Orderreplenish-mentstockShipmentsSupplier invoicesSupplier
statementsPayments to suppliersSuppliersStockMaterialsstockroomA
Figure 0 Diagram of the Distribution
System3.Maintaingeneralledger11-*
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Customers
1.3Billing1.1OrderEntry1.4Accountsreceivable1.2InventorySales
ordersRejected sales order noticesAccepted ordersFilled
itemsPurchasing dataReceived items Inventoryledger dataReceivables
ledger dataBilled ordersStatementsInvoicesCompleted orders Payments
by customers332 2A Figure 1 Diagram of the Systems that Fill
Customer Orders 11-*
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Purchasing data Commitments SuppliersPayments to
suppliersSupplier statementsSupplier invoices Payable ledger
dataMaterialsstockroom StockIncurred obligations2.2Receiving Issued
purchaseorder dataFilledpurchaseordersShipments Received items
Purchase ordersReceivedpurchases2.1Purchasing2.3 Accounts payableA
Figure 2 Diagram of the Systems that Order Replenishment
Stock3111-*
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3.1Update general ledger Receivables ledger data Inventory
ledger data Payables ledger dataGeneral ledger recordsUpdated
general ledger recordsGeneralledgerManagement report data
3.2Preparemanagement reportsOther reportsBudget reportsBalance
sheetIncome statementManagementA Figure 3 Diagram of the Systems
That Perform General Ledger Processes11-*
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Fill Customer OrdersOrder entry
Sales order formInventory
Process salesProcess receiptsFeed general ledger11-*
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CustomersSales ordersEdit rejectsSales order edit
ejects1.1.1Edit order data Rejectedsales order noticesEdited
ordersCustomer credit fileCredit data 1.1.2Computer credit
checkEdited and checked ordersCredit Rejects Sales ordercredit
rejectsAccepted orders1.1.3 Log inordersOrder dataCompleted
orders1.1.4Mark filledordersDate filedOrder logA Figure 1.1 Diagram
of the Order Entry System11-*
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Backorderfile1.2.1Checkthe balanceon hand1.2.2Check
thereorderpoint1.2.3Addreceiveditems1.2.4ProvidegeneralledgerdataItem
recordsBackorderrecordsInventoryfileItemsavailableUpdated
itemrecordsFilled itemsPurchasing dataInventoryfile
additionsInventoryrecordsReceived itemsInventoryledger dataA Figure
1.2 Diagram of the Inventory System22Acceptedorders11-*
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BillingInvoice
Note:1. Customer data2. Item data11-*
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Customers1.3.1Obtaincustomerdata
Customerfile1.3.2PrepareinvoicesFilleditemsCustomer dataInvoice
dataBilled ordersInvoicesCompletedordersA Figure 1.3 Diagram of the
Billing System11-*
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Accounts ReceivableFour separate triggers
Today's salesToday's paymentsTime to send statementsNeed to
provide general ledger data11-*
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Billed ordersAccountsreceivable fileReceivablesledger
dataReceivablesrecordsto deleteNew receivablesReceivables
records1.4.3PreparestatementsCustomersPayments by
customersPaidreceivablesfilePaidreceivablesrecordsStatement
recordsStatementsA Figure 1.4 Diagram of the Accounts Receivable
System1.4.1Add newreceivables1.4.4Providegeneralledger
data1.4.2Delete paidreceivables11-*
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Order Replenishment StockPurchasing
Emerging technologiesEDIISDNPurchase order11-*
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Supplier fileOutstanding purchase order files2.1.1
SelectsuppliersPurchasing dataPast performance dataInventoryand
supplier dataPurchase order data2.1.2Obtain
verbalcommitmentsSuppliers2.1.3Preparepurchaseorders2.1.4Close
outpurchaseordersCommitmentsPurchase OrdersIssued purchaseorder
dataIncurredObligationsPurchaseorder recordsFilled purchase
OrdersPurchase recordsto close outA Figure 2.1 Diagram of the
Purchasing SystemPurchase Order history fileRemoved purchaseorder
records11-*
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A Figure 2.2 Diagram of the Receiving
SystemSuppliersPurchaseditems
file2.2.1processreceiptsMaterialsstockroom2.2.1Notifyothersystems
Purchaseditem
dataIssuedpurchaseorderdataShipmentsStocksReceiptinformationReceived
itemsFilled purchase ordersReceived purchases11-*
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Accounts PayableThe firm pays suppliers when:
1.Stock was ordered (P.O. file copy)2.Stock was received
(Received purchases file)3.Invoice11-*
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Paid Payables Records Paid Supplier
DataAccountspayablefileReceivedpurchasesfilePaid
payablesfileSuppliersInvoice
andstatementfileReceivedPurchasesIncurredObligationsNew
PayablesdataPayablesRecordsPayables LedgerDataReceiptDataPayments
to SuppliersSupplier InvoicesInvoice DataPayablesRecords todeleteA
Figure 2.3 Diagram of the Accounts Payable
SystemPaymentdataSupplier statements2.3.4Providegeneral
ledgerdata2.3.3Delete paidpayables2.3.1Set
upsupplierpayablesrecords2.3.2Makesupplierpayments11-*
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AIS is the Foundation SystemThe AIS must be implemented
first
MIS DSS ES Depends on a well-designed AIS11-*
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SummaryAIS maintains financial records of the firmData
processing components
Data gatheringData manipulationData storageDocument
preparationAIS SubsystemsAIS contributes to problem solving
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