Core concepts of accounting information systems 13 by simkin norman chapter 02

Prepared by Paula Funkhouser
University of Nevada, Reno

Core Concepts of Accounting Information Systems, 13th Edition
Mark G. Simkin ● Jacob M. Rose ● Carolyn S. Norman

Accounting on
the Internet
Chapter 2

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Chapter 2:
Accounting on the Internet
• Introduction
• The Internet and the World Wide Web
• XBRL - Financial Reporting on the Internet
• Electronic Business
• Privacy and Security on the Internet

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The Internet and
World Wide Web
• Internet Addresses and Software
• Intranets and Extranets
• The World Wide Web, HTML, and IDEA
• Groupware, Electronic Conferencing, and Blogs

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Internet Addresses and Software
• Domain Address
– Also called a Uniform Resource Locator (URL)
– www.Name.com.uk
• Internet Protocol (IP)
– Numeric address of domain address
– 207.142.131.248
– Transmission Control Protocol (TCP)

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Intranets and Extranets
• Intranets
– Based on same software as the Internet
– Internal to the organization
– Outsiders are unable to access information
• Extranets
– Enable external users to access intranets
– Utilize passwords or private data communications channels

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The World Wide Web,
HTML, and IDEA
• World Wide Web
– Multimedia portion of the Internet
• Hypertext Markup Language (HTML)
– Editing language
– Used in design of web pages
• Hypertext Transfer Protocol (HTTP)
– Communications protocol used to transfer web pages

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HTML Code

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Display of HTML Code

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Groupware, Electronic
Conferencing, and Blogs
• Groupware

– Allow users to complete numerous tasks electronically
– Send and receive e-mail, collaborate on work tasks,
schedule appointments, share files
– Software include Exchange, Groupwise, Lotus Notes, and
Outlook

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Groupware, Electronic
Conferencing, and Blogs
• Instant Messaging Software
– Remote users communicate in real time
– Electronic Conferencing

• Knowledge Management
– Programs utilized to distribute expertise within the
organization

• Blogs
– Collaboration tool
– Create, share, and leverage knowledge
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Social Networking
and Its Value to Accountants
• Commercial Utilization

– Increase organization recognition
– Public reaction to launch of new product
– Developing an online presence
– Seeking new clients
– Communicate on projects
– Identify consumer anger

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Study Break #1
Which of the following is most likely to contain only numbers?
A. Domain address
B. URL address
C. IP address
D. Postal address

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Study Break #2
Which of the following enables users to view data with a web
browser?
A. Intranet
B. Extranet
C. Internet
D. All of these

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XBRL - Financial Reporting
on the Internet
• eXtensible Markup Language (XML)
– Similar to HTML
– Users define their own tags
– XML tags describe the data
• eXtensible Business Reporting Language
– Tags are standardized for business reporting purposes

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XBRL Code

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XBRL - Financial Reporting
on the Internet
• XBRL Instance Documents and Taxonomies
– Must understand the standard tags
– Must understand the rules that govern the use of the tags
• Current Status of XBRL
– XBRL International Consortium

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How XBRL Affects Accountants

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XBRL - Financial Reporting
on the Internet
• The Benefits of XBRL
– Transmit financial data in standard format
– Data items are uniquely defined
– Searching for tags is easier (IDEA)
– Data is self-checking
– Automatic and reliable exchange of financial information
– Companies are not constrained to specific formats

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XBRL - Financial Reporting
on the Internet
• The Drawbacks of XBRL
– Requires new users to learn, and conform to, the standards
of the language

– Evolving standards require conformity to changing
specifications
– No requirement for auditors to provide assurance
– Costs of transition

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Study Break #3
All of the following are markup languages (that use edit tags)
except:
A. HTML
B. BYTE
C. XML
D. XBRL

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Study Break #4
A document file containing XBRL tags is a(n):
A. Extranet document
B. Intranet document
C. Instance document
D. URL

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Electronic Business
• Definition
– Conduct of business with computers and data communications
• Categories of Electronic Commerce
– Accounting
– Retail sales
– E-payments and E-wallets
– Electronic data interchange
– Cloud-computing services

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E-Accounting
• Performing accounting functions on the Internet
– Preparing financial reports
– Completing income tax returns
– Preparing budgets
– Writing reports
– Publishing financial information

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Retail Sales
• Overview

– Virtual stores to sell directly to customers
– Automated AISs

• Problems with Internet Retail Sales
–
–
–
–
–

Legitimacy of web sites
Reliance upon e-mails
Reliance upon suppliers
Click fraud
Privacy concerns
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Advantages of Virtual Stores

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