Chapter 1:

OVERVIEW OF ACCOUNTING
INFORMATION SYSTEMS
(Subject code: 201085)

Prepared by: Accounting department 3

 Objectives of Chapter 1

❑ Introduction to accounting information systems

❑ Evolution of accounting information systems

❑ Role of accounting and accounting information

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 Contents

1.1 Accounting system

1.2 Data and Information

1.3 System

1.4 Definition and the evolution of AIS

1.5 Role of Accounting and AIS

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 Accounting System

❑ The language of business

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 Data and Information

❑ Data are the raw facts relating to or describing

an event
❑ Data becomes useful when the application of
rules or knowledge enable a conversion into
information
❑ Information is used in decision making
❑ Too much information is referred to as
information overload

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 System

❑ Something that takes inputs, applies a set

of rules or processes and generates
outputs

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 System (cont)

Inputs Data

Processing

Outputs
Information
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 Capturing Inputs

❑ Manual keying
❑ Scanning through barcode technology
❑ Scanning through image scanners
❑ Magnetic ink character recognition [MICR]
❑ Voice recognition
❑ Optical mark readers

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 Processes

❑ Processes are the sets of activities that

are performed on the inputs into the
system
Examples:
o Performing calculations
o Validity checks
o Hash checks

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 Outputs

❑ Outputs refer to what is obtained from a

system, or the result of what the system
does
Examples:
o Receipts
o Invoices
❑ Outputs are normally the starting point
when designing a system

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 System Elements

❑ Feedback is the method for ensuring that the

system is running as normal and that there are
no problems or exceptional circumstances

❑ A system will have a defined task or domain –

system scope : Phạm vi hệ thống

❑ The factors or pressures outside a system that

influence its design and operation are referred
to as the external environment

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 Definition & the evolution of AIS

1 2 3

Definition The Elements

evolution of AIS
of AIS

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 Definition

❑ The application of
technology to the
capturing, verifying,
storing, sorting and
reporting of data relating to
an organisation’s activities

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 The evolution of AIS
Pre 15th century: recording economic
activities
15th century: Pacioli’s development
of double-entry
accounting
19th century: adding machines and
cash registers >>
batch totals
20th century: punch cards >> fully
integrated computerised
systems
21st century: accounting information
systems

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 Accounting and IS – a Changing
Relationship

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 The Role of Accounting and AIS

❑ Traditional financial statements are not the only

source of information available through the AIS

❑ Accounting information is required by many

different users (SAC 2)

❑ Uses of Accounting information include:

o Assessing customers and bad debts
o Assessing inventory requirements
o Evaluating staff performance
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 Data Mining

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 Review of Chapter 1

❑ Introduction to accounting information systems

❑ Evolution of accounting information systems

❑ Role of accounting and accounting information

❑ Course content in context

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 Key Terms

o Accounting o Inputs
information system o Outputs
o Data o Processes
o External environment o System
o Feedback o System scope
o Information overload

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