[About this workbook “This workbook is the fst ection an Accounting Information System (AIS) course hich s cides into {so part. The fst part deal vith the cussion on Row AIS warks in an organization. Eight totes ae included in this part which vil hep students gain knowledge on howto design an elective AIS. Considering the rsks and problems associated In every system, student wil also be provided vith topes on conto ich wil mtg these risks, The Conta! Objectives fr Information and Related ‘Technology (COBIT) amev/rk willbe used fortis purpose. The second par of te Workbook she Usage of a commercal Elecenic Resource Planning (ERP) softvare wherein students il De experiencing the actual posing of dierent business Yansactons, They wil bo provided with 39 ‘adminsttion user authori oF the so-called super user auhory to enabie them access al the ‘valle modles inthe system, |Atthe end ofthis course, the students shouldbe able to: 1 Partcpale inthe design ofan aperopiate AIS to an crgarizaton regardless of is nature, 1. Assess the relay ofthe system trough the COBIT framework. ©, Use asotvare in recorcing)posting of ancl tansactons. 4. Generate reports om te software intense fr fs usersPART 1-AIS LECTURE ‘Table of Contents CHAPTER Poe 4 Irteduction to Accounting Information Systems (AIS) AIS dein Data vere Inermaton Flows of infrmation Compenentso AS Organization sructre AIS models “Account as sjstemorientes professional 2 Irreduction to Transacton Processing System (TPS) “TPS deteton Data processing cyte of the TAS. Comparison of accountng reese manual vs computer-based Documentation tecraques Flowcharting symbes| 3 ie Spent Ce Pat Purchases and Cas Dsbsaent Ste Bicenstre cycle Subsystems cf expenditure crcle * 4 Tre Espen Cycle Par 2 Parl Proessing and Feed Ase Sse, Payrol processing Fed Asset Procedures ® 5 The Revenue Cycle Revenve cele detntion 1. ‘Subsystems of revere cycle 8 6 Francial Repetng and Management Reporing Systems Frnaneil reporting 20 Management reporting system 20 1 Elecreni commerce Elecrene conmetes and its importance 2 Inte technologies and terminologies 3 a Information System Controls Infomation technology controls andthe business 25 {Catogeis of information system controls 25List of exercises Exercise No. Page Preliminary Petlod Frow of ntrmaton 3 Data sttbutes and cestion of fle 3 Dataflow agra (OFD) and fowcharts 0 Expenditure eye documents 2 Midterm Period Fxed asses logical ters w Revenue Cycle activites ° ‘Somisinal Period Financial Reporting Syste (FRS) & Management Reporting System (MRS) 22 E-commerce: oplevel dean (TLD) names & Final Perlod ‘Recess convo mat a List of cooperative learning activities, ‘Activity No, 4 2 3 Payroll rocessing Infomation System contots Design ofan AIS BEEPART 2-AlS LABORATORY MODULE Table of Contonts Irrccuction to ystems, Appleton & Products (SAP) SAP defiton ‘SAP Business One ots components ipenature cyte Purchasing AP. Purchase oder Purchasing AP. Geods receipt PO Purchasing AP. Goods return Purchasing AP. AIP invoice Purchasing AP: A ereat memo Banking: Ougong payments Revenue Cycle ‘Sales AR’ Sales Order Sales AR: Desvery Sales AR: Retrn Sales AR: AR invoice Sales AR’ AR crest memo Sales AR: AR invoioepayment [Banking Iecming payments Cher Transactions Processing Systeme Financia rma voueners Financial: Jornal envy Inverter Goods rene and goods sue Financia Financia reports ‘System Configuration BD NAAT BeegReeS SRBSSBEList of exercises Exercise No. Preliminary Period 1 Ske Stans ore peng stones i Recs Seer 3 Gen RecoptPo : Sis pean : inse é Ee cettnene $ SossnePaymes it Psa ¢ mee i ae Rau Time e MRcet ene ee Seminal Pred Sarno SS fa Pood vy —— Senesraraten 8 eaten and posting of business ransactons z bastese megareCHAPTER 1 Introduction to Accounting information System ‘Student outcomes: At the end of his tpi, students should be able to "Discuss the relationships among accountng, fermion an system 2. Dilerantate tne diferent fs af nformaton thn an ovsice te orgaizaton 3. Identity the cere models of AS Als detinition Accounting infsmstion system can be defined using the thee interelated wards that comprise accounting, information ahd system. Let us start ih the word informatien which connects tbe tv Temaining Words, accounting and systems, As ths ste focal pint of te sublect ve can say that IS the most impotent resource tat tne arganzaton needs in a'Way that acats beer decisions {er allisntonged users. However, to have an ifermaton, there must be @ system or process tet vl be used fo convert face or data intaa ueeRdnermaton, With tis, system canes in whieh seule titer be manual or database (REA ard ERP) And of course, there isthe word accounting in which ‘be data or facts tha the crganizaton needs must be inane nature because what Sakeholsers ‘neds the performance ofthe business thet ill deterrine whether the vil annus their parnershp ‘rh the fm or business, Hence, AS is system tat eonverts franca data or fet nko & Use Information fr decision making of vaicus stakehildes. Data versus Information Data and information ae semetimes being used interchangeatiy. However, data is ferent tom Infermaton in away tat data are facts which may or may not be processed we iformatons simply ‘processed data In here, data ae nous whe Ifermaton an ouput Information causes the user to act because ofthe eect it gves to that use. For example an aging ‘repo of customers is vento the colecion departrent Ths ifermaton causes the calection agent {omake a folow-up tothe customers wth unpald accounts. However. te seme report wil be gen {to HR manager, the report's us collection of fet or daa in whieh ne action vil be taken bythe manager Flows of intormation Usetulinfoematon rps organization make ect decisions. Numerous infrmaton flow inside and ‘outside the ergarizatin ona daly bass. This lows of nermation ae ether internal cr external Invent infomation retest the Internal flow of information which an be from department to department (hofzontal) or witun the sare level of responsslty and om top management ‘Sepa cr vice-versa (vertical, ‘Components of AIS "I Transaction Processing System ~ captures the day-to-day operons of the business which ‘composed of three Yansacen cycles” the revenue eyee, the expendture cyle and the conversion eel 2 General Lesger Finacial Reporting System GGLS processes the summaries oftransacton cycle actvty so that general lege accounts fae updated. FRE on the hand produces Thanell Inormaton ited from the summaries‘ronsactions posted ine Glin tne fom of ancl reco centrally Iended fr external |3. Management Reporting System: produces managementreperts which ae als taken rom the Information posted nthe GLS. These repors are cscrionay and intend for management's purposes nly. Organizational structure ‘Ths siuclure shovs the dstibuton of responsibly, suthoty and sccountabiy across the ‘xganizaton whch help in assessing usr ivermaton needs I's composed cf segments. Te tee ‘of ne most emmmon business segmentations include: 1." Geographical location ~operatons of te business ae spersed all over the couniry andthe \wor to gan abcess to resouToes or markets. 2, Product fine ~ fis that produce varied products and organizing them ino product nes ‘esting to creaion cf erert cisions for each ine. 53. Business function ~ fms that vide the operatons into areas of specialized resporsiity 2ecorang tasks Ike marketing department, operations departvent and nance department AIS models 1 Manual process model Is the oestaccourting information system that involves manual recording of business rransactons 2 Flatfile model Ils often associated with legacy systems in which indidul les re not related to other files Users oun ther datafile and do not share tem with her uses. 3. Database ‘hss appr00en cotralzes the tems data into a common database wnich s shared by a Users ofthe organization. User's access conrlled by a calasase management stem {OBIS desea on ser love of autor. 4. Resources, Events & Agents (REA) ‘An accountng framework which has 3 Key elements: Resources, Events and Agents Resources are arsefe that are scarce and conrallace bythe fm, Events ae business ‘alulies which affect changes in resources. Agents are partes that pareipate in an 5. Enterprise Resource Planning (ERP) “This model enaties an organization to sutemate an integrate ts Key business process byfattsing cate sharing, Information fows and ivodcion cf common pracoes among allorganczatcns en users. The recognized ERP commercial proses Include SAP an Grace. ‘Accountant as systom-orlonted professional ‘Assountant performs tree functors he informaton system emvironment which are te felling: “._ System user ~as end use, she function ofthe accourtant toldenify what information and reports ae needed bythe accuring cepartmert tothe Tr personne! charge of cesiQ49 the sytem. Accounting hincons the single ages! end ser of IT In most organizabens since ‘allystoms that process nancial infermaten are dec} related to accounting 12 System designer- secountant shoud help computer programmers in the design of the ‘concepal system by ening the accoutng ules ahd principles and necessary contals ‘hat must ben place before @cerain program willbe erste. 3. System aucior- aucttors should assess the eflectveness of IT conrls implemented by an ‘xganzation before an opinion can be excressec.Exercise No.4 Nome: Date: Section Code: Extemal and internal flows of Information. aenity he fow of infomation described below. intemal, ent ether verti or hotlzcntl (10 points) Report on financial performance ofthe business forthe year 2014 wrichis, 1. Request of user department of varcusoffce supplies need to ‘Warehouse department as evdenced by a purchase requiston sip. 2.__Ananneuncement postedin the bulletin bosrd of the offce cascaded ‘7H manager rearsing the suspension of ofce werk ue to dedaration of hada of hs local ‘overnert 3. Customer satisfaction survey collected and summarizes by the ‘Gasiomer Ralaiens Deparment. 4. _ Mints of operations meeting provided by the secretary tothe ‘Geren anges ad supervsors concerned 5. summary of employees’ daly etendance recoras submitted by HR ‘eRe Payal Deparment 6. Traning schedules of concerned employees per department for year BIS prepared bythe Personne Department 7. Approves memo fiom VP-opeations regarding the intercompany ‘Tansie of ompuTer unt tom sales department to marketing department 8 Approved supplemental budget on advertising event ofthe ‘artetng department, 8. Audited weekly sales reson submited to Operations depsrment 10 Monthy amusement tax report prepared by accourtng department renters oR,10 CHAPTER 2 Introduction to Transaction Processing System Student Outcomes: At he end ofthis tpi, students shouldbe ab to: 1. Wnty the types of transaction cycles 2. Enumerate daa storage cements 53. Prepare a OFD and document flowchart ‘Transaction Processing Systom (TPS) definition Transaction Processing System (TPS) processes business scvites which are fnaneal in nate “whin occur on 2 regular basis Simlarfype of vansactons are grcuped tether called ransacton {eles in ede o property handle te voluminous events happening in a busness. Regardless ofthe type eft business, there ae te types of transactions eles, ‘These are the folowing 1. The expenditre cycle 2. The conversion je Vor manufacturing ony) 3. The revenue. Data Processing cycle ofthe TPS: 1 "Data input — caplring of the transaction data supported by vad documents (source, {umarcund & souroe dala automaton) and recording them nto the system. 12 Data sorage soning of ecorced/posed nancial tansactons inte general and subsidiary ledger. Eenents ety — sometring abeu which vomaton is sored such as customers & eteovees, + utes~ refers othe characteris of intrest ofan ent in when each ‘ype of ently has he sane sto tutes. Exam. alnvertay ome have twenty fe. pice per unt ancunk of measuremeris Fils \vhere te datas sree FRecre refers to felts contain data abou erty atributes. ‘ata valve ~ contents ofa fel within aco Fea group ofelte reer Examale Inventory items fle fee Hem Desertion Pree, ot ot measure coorecd Hepner P2000 piece 002000 Caren printer 00 pece 00seco Laser ter. 30.000 pce ‘o04000 Lenovo peter 24000 pece “This iventry fei composed of 4 entes: HP pine, Canon printer, and Laser pine ana Lanovo peter Tere oe also 4 records in ihe fle Four abuts ore {sec to deserve each tem: em na tam description ree and unt of meastre. ‘There are four elds in each reso Each eld const of Sta vale tat Seseibes nate of aniventory ent 3, Data processing ~nvoves four types of sctites: cresting new dta resting of existing ata Updating of previously stores data and deleting cata "Batch processing" + cntne-teai te processing 4, Information op: genera presented s6 a documenta reportor squetyresoonse Comparison of accounting records used by transaction cycles: manual vs computer-based Manual System Computer-based syste ‘Boouments Reference fles Source documents Data fom a paidinvoice ae used in updating the cash paymerss ledger Reena earns Oo = ‘Revie vice prepared manvaly edsentioaclent ‘Customers billng Gale are receivedna CHAPTER 3 ‘The expenditure cycle part I: Purchases and cash disbursement systems ‘Student outcomes: At the end ofthis opi. students shouldbe able to: 1. deny the ferent documents usedin purchases and cash disbursement procedures. 2 Enumerate the ifeent processes invaved inthe expenditure cle Expenditure cycle ‘The expenditure cyl ofan organization stars with the acquisition of goods or senvces om asuppler vendor and ends on paymentof tat aigaton or laity. The conceptual system of te expenatire ‘je ll be described 0 you trough the sequence of aciviles vole if. Remember thatthe Conceptual system is only centres wit the logical lasts ofthe expenature cjle and not on how ane ‘iho performs sai tasks. ‘Subsystems of Expenditure Cycle ‘There se vo subsystems involve nthe expencture cycle, the purchase processing procedures nd ash sabursement Pura processing procedures incide the task of Mentyng inventory needs, pacing the order, receiving the order ar recogning the labity. Each ofthese tasks uses documents fo suppor the recording ofransactons. Examples ae purchase reqision putchase eer. elvry rei, retum Sip. voices and debit memo, Meanvile, cash dsbutsement procedures move payment of ‘oligaons fo suppliers crested bythe purchase processing rovedires, t's usualy supported by & heck voucher atached fs supporing documents such ase puchase order, clive) recast and Invoices. Mode of payment may ether be tvucash check, crest card ard auto credit ionare some, bone oes re er [= ——— iS same Deane a Fiowe 1. Relationship map of documents inthe expenciture cycle part 118 Exorciae No. 4 Nome! Date Sedtion Code: Expenditure cyete documents. Wie the word's belng desrbed by the statements below. (8 points 1. Thsdocument serves as an ofr to buy goods ram a ven 2. Aninternsl document which usedto inate the purchase of ims or sonees 3. A document used to record the quanties and candtons ‘everea byhe vende. 4 tis usea to record adjustments to accounts payable for the ‘oeds reared TT vender. 5. This document typically triggers the process of recording 3 Tao 6 This document hep to ersure that he receiving clerk actualy ‘Sante number of Goods receved 7 These 3 documents ate matched in. sccounts. payable processing 8. This department is responsible forthe approval of suppl ince Ter parma © Adccument used ost each invoice being pid by a check. 10, Responsile for custedal function of the company and the ‘recess of paves to suppliers18 CHAPTER 4 ‘The expenditure cycle part 2: Payroll processing and fixed asset systems ‘Student outcomes: Atthe end ofthis epic, students shouldbe abet: 1. Enumerate the processes invaved in paral 2 Prepare accurately report. review a report and design and create 8 pay sip 3 Enumerate the processes in fxec assets procesures Payroll Processing ‘Ths process a special case purchase system by vhich the business purcnases labor or services {ater than goods fer sale It is where the service rendered ty emplayess are processed n hat ve ‘alin salary of employees during a given period of time. Payrol systom varies tem ane business [0 ‘another as in the case of a marufackring, sevice or ating fms. Different documents and ‘departments ore ivoWed in ts process. The flowing table represents the pay processing of ‘Seren! businesses, ‘Deparment | TasksvAey Dasiment used Personne! | Prepares and submits personnel adn forma Personne ection fem Frosueton | Prepares 2 types oftme records sob eke a ‘imecards Payot ‘Receives the personnel acon tems ang ime cards| Payal egster «3 basis othe preparation of payrl register Prepares paychecks ‘Recounts | Reviews the payol reise andprepares copies of | Vous register Payable | cashasbursement voucher which vibe recor Inthe voucher register cash Prepates a sing check rie ene amount of | Chest cisbursement__| payrlto be deposited inthe payroll mprest accountCooperative learning: Activity No.1 “To be able to fully understand the aces happening inthe payroll processing functions, group yourselves int three members. Assign a member vo wil perform the Tunetons gen below and acomplsh the reports and oufputs required rom each poston. You ste only ven one hour to 1th task Make sure that younave brought the lest S85, Phiheath Pag ig anda tables, Position ‘Tasksiunctions. ‘ReporvOutput THR clerk | Prepare the surmary of hours worked af | Surnmaty of hours waked employees based on he aude time cares, | report Refer tothe format providedte you. 2 Aesauning | Check the work of BR clerk as basis forthe | Payol regster Referto ‘ler reparaton of payrl register ‘we given format ‘3. Treasury ark | Des your company's pay sip bared onthe | Payslps Information refiectes on te paral restr Reporton employees’ summary of hours worked For danuary 118, 2015 Name of employes [No of days present me ‘Ungerime: lous | Minutes | Hours | Winutes Prepares by: heckes by: Rak Reeoarting Clerk Dally Time Record NC Concepcion [Sige ate: P 30000, aM PM ‘UNDERTIVE De Tin [out [in —_| Out_| Hours | Minutes [shan [rtp [opm | spe 2 [tn [15pm [12s | gn 3 [Alten | 15pm on | Rp 4 | 15am | eal | 18pm | Fp ‘5 —[145an [Tet [pn [tg 6 [15am [eb | en |e 7 = Tapa | WT ip pn | 15m | Sgn apn | St | 0p pn | had | pm Tap | OL Spm pn [Ohm Sgn Tap | WT “SharonCuneta {MES [Monthly Rate P 30,000 Dey| AM PM_—| UNDERTIME2 For January 1-15. 2015 oR Tae [a z ri z Tae = Tage a Tig 1 é i H ii 3 Tage Sa | | i 2 | Tt a 5 [155 eT Wp ans 7 S17 wort te 0 0 "Toa [mo | [i 2s | Tg [ge pe Spas [ane ap Suge [rem [Age pe [ai ang |g S[k ag [Wg hes [im | ip |p [|p [sp [pe 05h ag [ig [5 [ ae a 12 sag 15 [ip Tg [tp ac 15 [ ae | a ‘Accounting clerk report Sar conany Page ‘Name of | Basie | Overtime Te ‘Undertme ] Gross | W.Tax HOME [SSS | PHICHEALTH el Prepared by: Texan oeR