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ACTG 474 MIDTERM STUDY GUIDE
system - Answers - two or more interrelated components that interact to achieve a goal, often composed of subsystems that support the larger system goal conflict - Answers - when a subsystems goals are inconsistent with the goals of another subsystem or the system as a whole goal congruence - Answers - when a subsystem achieves its goals while contributing to the organizations overall goal data - Answers - facts that are collected, recorded, stored, and processed by a system information - Answers - data that has been organized and processed to provide meaning and improve decision-making information overload - Answers - exceeding the amount of information a human mind can absorb and process, resulting in a decline in decision-making quality and an increase in the cost of providing information information technology - Answers - computers and other electronic devices used to store, retrieve, transmit, and manipulate data value of information - Answers - benefit provided by information less the cost of producing it business process - Answers - a set of related, coordinated, and structured activities and tasks, performed by a person, a computer, or a machine that help accomplish a specific organizational goal transaction - Answers - an agreement between two entities to exchange goods or services transaction processing - Answers - process of capturing transaction data, processing it, storing it for later use, and producing information output, such as financial reports give-get exchange - Answers - transactions that happen a lot, such as giving up cash to get inventory transaction cycles - Answers - major give-get exchanges that occur frequently in most companies revenue cycle - Answers - activities associated with selling goods and services in exchange for cash or a future promise to receive cash
expenditure cycle - Answers - activities associated with purchasing inventory for resale or raw materials in exchange for cash or a future promise to pay cash production/conversion cycle - Answers - activities associated with using labor, raw materials, and equipment to produce final goods HR/payroll cycle - Answers - activities associated with hiring, training, compensating, evaluating, promoting, and firing employees financing cycle - Answers - activities associated with raising money bu selling shares in the company to investors and borrowing money as well as paying dividends and interest general ledger and reporting system - Answers - information-processing operations involved in updating the general ledger and preparing reports for both management and external parties accounting information system - Answers - system that collects, records, stores, and processes data to produce information for decision makers. it includes people, procedures and instructions, data, software, information technology infrastructure, and internal controls and security measures predictive analysis - Answers - use of data warehouses and complex algorithms to forecast future events, based on historical trends and calculated probabilities value chain - Answers - linking together all of the primary and support activities in a business. value is aded as a product passes through the chain primary activities - Answers - value chain activities that produce, market, and deliver products and services to customers and provide post-delivery service and support support activities - Answers - value chain activities such as firm infrastructure, technology, purchasing, and HR that enable primary activities to be performed efficiently and effectively supply chain - Answers - an extended system that includes an organizations value chain as well as its suppliers, distributors, and customers source documents - Answers - documents used to capture transaction data at its source- when the transaction takes place turnaround document - Answers - records of company data sent to an external party and then returned to the system as input. in machine-readable form to facilitate their subsequent processing as input records
record - Answers - a set of fields who data values describe specific attributes of an entity data value - Answers - the actual value stored in a field. it describes a particular attribute of an entity file - Answers - a set of logically related records master file - Answers - a permanent file of records that stores cumulative data about an organization. as transactions take place, individual records within a master file are updated to keep them current. transaction file - Answers - a file that contains the individual business transactions that occur during a specific fiscal period database - Answers - a set of interrelated, centrally controlled data files that are stored with as little data redundancy as possible. a database consolidates records previously stored in separate files into a common pool and serves a variety or users and data processing applications batch processing - Answers - accumulating transaction records into groups or batches for processing at a regular interval such as daily or weekly online, real-time processing - Answers - the computer system processes data immediately after capture and provides updated information to users on a timely basis document - Answers - a record of a transaction report - Answers - system output, organized in a meaningful fashion, that is used by employees to control operational activities, by managers to make decisions and design strategies, and by investors and creditors to understand a company's business activities query - Answers - a request for the database to provide the information needed to deal with a problem or answer a question enterprise resource planning - Answers - a system that integrates all aspects of an organization's activities- such as accounting, finance, marketing, HR, manufacturing, inventory management- into one system documentation - Answers - narratives, flowcharts, diagrams, and other written materials that explain how a system works narrative description - Answers - written, step-by-step explanation of system components and how they interact
data flow diagram - Answers - a graphical description of the flow of data within an organization, data flows, transformation processes, and data storage data source - Answers - the entity that produces or sends the data that is entered into a system data destination - Answers - the entity that receives data produced by a system data flow - Answers - the movement of data among processes, stores, sources, and destinations process - Answers - the action that transforms data into other data or information data store - Answers - the place or medium where system data is stored context diagram - Answers - highest-level data flow diagram; a summary-level view of a system, showing the data processing system, its inputs and outputs, and their sources and destinations flowchart - Answers - an analytical technique that uses a standard set of symbols to describe pictorially some aspect of an IS in a clear, concise, and logical manner document flowchart - Answers - illustrates the flow of documents and data among areas of responsibility within an organization internal control flowchart - Answers - used to describe, analyze, and evaluate internal controls, including identifying system strengths, weaknesses, and inefficiencies system flowchart - Answers - depicts the relationships among system input, processing, storage, and output program flowchart - Answers - illustrates the sequence of logical operations performed by a computer in executing a program business process diagram - Answers - a visual way to describe the different steps or activities in a business process threat/event - Answers - any potential adverse occurrence or unwanted event that could injure the AIS or the organization exposure/impact - Answers - the potential dollar loss should a particular threat become a reality likelihood - Answers - the probability that a threat will come to pass
and control exist, and auditors to substantiate their internal control opinions and advise on IT security and control matters committee of sponsoring organizations - Answers - a private-sector group consisting of the american accounting association, the AICPA, the institute of internal auditors, the institute of management accountants, and the financial executives institute internal control- integrated framework - Answers - a coso framework that defines internal controls and provides guidance for evaluating and enhancing internal control systems enterprise risk management- integrated framework - Answers - a coso framework that improves the risk management process by expanding coso's internal control- integrated five components of coso's internal control model - Answers - control environment, risk assessment, control activities, information and communication, and monitoring internal environment - Answers - the company culture that is the foundation for all other erm components as it influences how organizations establish strategies and objectives; structure business activities; and identify, assess, and respond to risk risk appetite - Answers - the amount of risk a company is willing to accept to achieve its goals and objectives. to avoid undue risk, risk appetite must be in alignment with company strategy audit committee - Answers - the outside, independent board of director members responsible for financial reporting, regulatory compliance, internal control, and hiring and overseeing internal and external auditors policy and procedures manual - Answers - a document that explains proper business practices, describes needed knowledge and experience, explains document procedures, explains how to handle transactions, and lists the resources provided to carry out specific duties background check - Answers - an investigation of a prospective or current employee that involves verifying their educational and work experience, talking to references, checking for a criminal record or credit problems, and examining other publicly available information strategic objectives - Answers - high-level goals that are aligned with and support the company's mission and create shareholder value operations objectives - Answers - objectives that deal with the effectiveness and efficiency of company operations and determine how to allocate resources
reporting objectives - Answers - objectives to help ensure the accuracy, completeness, and reliability of company reports; improve decision making; and monitor company activities and performance compliance objectives - Answers - objectives to help the company comply with all applicable laws and regulations event - Answers - a positive or negative incident or occurrence from internal or external sources that affects the implementation of strategy or the achievement of objectives inherent risk - Answers - the susceptibility of a set of accounts or transactions to significant control problems in the absence of internal contol residual risk - Answers - the risk that remains after management implements internal controls or some other response to risk expected loss - Answers - the mathematical product of the potential dollar loss that would occur should a threat become a reality (impact or exposure) and the risk or probability that the threat will occur (likelihood) control activities - Answers - policies, procedures, and rules that provide reasonable assurance that control objectives are met and risk responses are carried out authorization - Answers - establishing policies for employees to follow and then empowering them to perform certain organizational functions. authorizations are often documented by signing, initialing, or entering an authorization code on a document or record digital signature - Answers - a means of electronically signing a document with data that cannot be forged specific authorization - Answers - special approval an employee needs in order to be allowed to handle a transaction general authorization - Answers - the authorization given to employees to handle routine transactions without special approval segregation of accounting duties - Answers - separating the accounting functions of authorization, custody, and recording to minimize an employee's ability to commit fraud collusion - Answers - cooperation between two or more people in an effort to thwart internal controls segregation of systems duties - Answers - implementing control procedures to clearly divide authority and responsibility within the information system functions
system performance measurements - Answers - ways to evaluate and assess a system throughput - Answers - the amount of work performed by a system during a given period of time utilization - Answers - the percentage of time a system is used response time - Answers - how long it takes for a system to respond post-implementation review - Answers - review, performed after a new system has been operating for a brief period, to ensure that it meets its planned objectives systems integrator - Answers - an outside party hired to manage a company's systems development effort analytical review - Answers - the examination of the relationships between different sets of data computer security officer - Answers - an employee independent of the information systems function who monitors the system, disseminates information about improper system uses and their consequences, and reports to top management chief compliance officer - Answers - an employee responsible for all the compliance tasks associated with SOX and other laws and regulatory rulings forensic investigators - Answers - individuals who specialize in fraud, most of whom have specialized training with law enforcement agencies such as the FBI or IRS or have professional certifications such as certified fraud examiner computer forensic specialists - Answers - computer experts who discover, extract, safeguard, and document computer evidence such that its authenticity, accuracy, and integrity will not succumb to legal challenges neural networks - Answers - computing systems that imitate the brain's learning process by using a network of interconnected processors that perform multiple operations simultaneously and interact dynamically fraud hotline - Answers - a phone number employees can call to anonymously report fraud and abuse
