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Learning Objectives
Describe the four major steps in the data processing cycle.
Describe the major activities in each cycle.
Describe documents and procedures used to collected and process data.
Describe the ways information is stored in computer-based information systems.
Discuss the types of information that an AIS can provide.
Discuss how organizations use ERP systems to process transactions and provide information.
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The Data Processing CycleDetermines
What data is stored?
Who has access to the data?
How is the data organized?
How can unanticipated information needs be met?
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Data Input—Capture
As a business activity occurs data is collected about:1. Each activity of interest2. The resources affected
3. The people who are participating
Paper-Based Source Documents
Data are collected on source documents E.g., a sales-order form The data from paper-
based will eventually need to be transferred to the AIS
Turnaround Usually paper-based Are sent from
organization to customer
Same document is returned by customer to organization Turnaround Document
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Source Data Automaton
Source data is captured In machine-readable form At the time of the business activity
E.g., ATM’s; POS
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Data Input—Accuracy and Control
Well-designed source documents can ensure that data captured is Accurate
Provide instructions and prompts
Check boxes Drop-down boxes
Complete
Internal control support Prenumbered documents
Ledger
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General Summary level data for each:
Asset, liability, equity, revenue, and expense
Subsidiary Detailed data for a General
Ledger (Control) Account that has individual sub- accounts Accounts Receivable Accounts Payable
• Joe Smith$250
• Patti Jones$750
• ACME Inc.$150
• Jones, Inc$350
Jo
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General Infrequent or specialized transactions
Specialized Repetitive transactions
E.g., sales transactions
Digit Position Meaning
1–2 Product Line, size, and so on
3 Color
4–5 Year ofManufacture
6–7 Optional Features
1241000 12 = Dishwasher4 = White10 = 201000 = No Options
Coding
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Sequence Items numbered consecutively
Block Specific range of numbers are
associated with a category 10000–199999 = Electric
Range
Group Positioning of digits in code
provide meaning
Mnemonic Letters and numbers Easy to memorize Code derived from description of item
Chart of accounts Type of block coding
Computer Based
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Entity Person, place, or thing (Noun) Something an organization wishes to store data about Attributes
Facts about the entity Fields
Where attributes are stored Records
Group of related attributes about an entity File
Group of related Records
File
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Transaction Contains records of a
business from a specific period of time
Master Permanent records Updated by transaction
with the transaction file
Database Set of interrelated files
Data
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Four Main Activities1. Create new records2. Read existing records
3. Update existing records4. Delete records or data from records
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Enterprise Resource Planning (ERP)
Integrate an organization’s information into one overallAIS
ERP modules: Financial Human resources and payroll
Order to cash Purchase to pay
Manufacturing
Project management Customer relationship management
System tools
ERP
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Integration of an organization’s data and financial information
Data is captured once
Greater management visibility, increased monitoring
Better access controls
Standardizes business operating procedures
Improved customer service
More efficient manufacturing