Accounting information system an overview 9e bodnar hopwood chapter 06

Electronic Data
Processing Systems

Chapter 6

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–1


Learning Objective 1

Describe how application
controls are used in data
processing systems to
ensure accuracy
and integrity.
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–2


Paper-Based Input System
In some computerized accounting systems,
inputs to the system are based on
handwritten or typed source documents.
These documents are then collected and
forwarded to computer operations for
error checking and processing.
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–3


Preparation and Completion
of the Source Document
The source document, such as sales
orders, are prepared manually.
Errors can be minimized if the
source document is well designed
and easy to understand.

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–4


Transfer of Source Documents
to Data Processing
Batch control totals and data transfer
registers controls data transfers.

User’s departments

Data processing

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–5

Transfer of Source Documents
to Data Processing

Document counts are a simple
form of batch control.
Batch totals may be taken for all or several
numeric fields in the original data file.

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–6


Transfer of Source Documents
to Data Processing
Data entry
Key verification
Visual verification
Program data editing
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–7


Program Data Editing Techniques
Data editing routines may be applied
to each of the basic data structures.
Character

Fields

Records

Files

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–8


Program Data Editing Techniques
What is a table lookup?
It is an editing program that compares
the value of a field to the acceptable
values contained in a table file.

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–9


Program Data Editing Techniques
Limit test
Continuous operations auditing
Check digit
Valid code check
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–

Paperless Input Systems
In paperless input systems, sometimes called
online input systems, transactions are input
directly into the computer network.

Possible loss of segregation
of duties and audit trail.
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems
Source
document
Preparation

Data entry

Performed by the same person

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems
Transaction logs or transaction registers
are created by logging all inputs to a

special file that automatically contains
tags to identify transactions.

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems
What is tagging?
It means that additional, audit-oriented
information is included with
original transaction data.

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems

Online manual data entry systems
Automatic identification systems

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems

Transactions in paperless input systems
involving human intervention typically
proceed through two phases.
1. Data entry and data editing
2. Transfer to the host application system
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paperless Input Systems

Networked vending machine (NVM)
Electronic data interchange (EDI)

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Learning Objectives 2 and 3
Characterize the various
types of electronic systems
used for processing.
Describe the basic functions
of a computerized
accounting application.
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–

Paper-Based Processing Systems

Weekly time reports to produce paychecks
Groups of checks to update
accounts payable master files
Processing invoices to update an
accounts receivable master file
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Paper-Based Processing Systems

Sequential file updating
Random-access file updating

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Batch Processing with
Sequential File Updating

Preparing the transaction file
Updating the master file
Updating the general ledger

Preparing general ledger reports
 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Sequential File Processing
Invoices

1

2

Data
terminal

Process
input

3

Transaction
file

Batch
balance

A

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Sequential File Processing

A

4

5

Transaction
file

Edit
program

Control
report
14

6

7

Good data
file

Sort to

master file
sequence

Rejected
data

Control
report
13

Reconcile
Control
procedure

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Sequential File Processing
8

Sorted
transaction
file

11

New
master

Control
data
10

Master file
update
12

Transaction
file

9

Old master
file

Old
master
Retain for
backup 15

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

6–


Son–Father–Grandfather
Master Files

Old
Father master
file

File
update

Backup
Grandfather master
file

New
Son master
file

 2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood

Next
file
update

6–