Core concepts of accounting information systems 13 by simkin norman chapter 11

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
Information Systems
and Business
Processes - Part II
Chapter 11

1


Chapter 11:
Accounting Information Systems and Business
Processes - Part II
•
•
•
•
•
•

Introduction
The Resource Management Process
The Production Process
The Financing Process
Business Processes In Special Industries
Business Processes Reengineering

2
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Introduction
• Business Processes
– Sales and Purchasing
– Resource Management, Production, and Financing

• Information Needs
– Typical AIS requirements
– Specialized information

3
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource Management
• Personnel function
– Hire, train, and employ appropriately qualified
employees

• Business Process Management Software
Packages
– Automate the core processes

• Payroll Processing Information Systems
– Process payroll activities and reporting
4

Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource
Management Objectives
•
•
•
•
•

Hiring, training, and employing workers
Maintaining employee earnings records
Complying with regulatory reporting requirements
Reporting on payroll deductions
Making timely and accurate payments to
employees
• Providing an interface for personnel and payroll
activities
5
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Personnel Function Flowchart

6
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Payroll Function Flowchart

7
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource
Management Inputs
• Personnel Action Forms
– Documents hiring or changes in employee status

• Time Sheets
– Tracks hours worked

• Payroll Deduction Authorizations
– Authorization to deduct certain amounts

• Tax Withholding Forms
– Authorization to withhold appropriate tax amounts

8
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource
Management Outputs
• Financial Statement Information
• Employee Listings
– Current employees
– May contain employee-specific information

• Paychecks
– Final documents; subject to strict internal controls

• Check Registers
– Used to make journal entries for salary and payroll tax expenses
9
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource
Management Outputs
• Deduction Reports
– Summaries of deductions for employees as a group

• Payroll Summaries
– Used to analyze expenses

• Tax Reports
– Government required information
– Income tax, social security tax, unemployment tax

10
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Human Resource
Management Summary

11
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.

Study Break #1
All of the following activities are common to the Human
Resource Management function except:
A. Hiring, training, and employing workers
B. Reporting on payroll deductions
C. Maintaining employee earnings records
D. Certified financial planning for employees

12
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
• Fixed Asset Management Function
– Long-term Assets
– Purchase, maintenance, valuation, disposal
• Enterprise Asset Management System
– Automate management of assets

13
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Objectives
• Tracking purchases of fixed assets
• Recording fixed asset maintenance
• Valuing fixed assets

• Allocating fixed asset costs (recording depreciation)
• Tracking disposal of fixed assets

14
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management Function
Flowchart

15
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Inputs
• Purchase Requisition
– Requires approval by management
• Receiving Report
– Identifies receipt of fixed asset
• Supplier Invoice
– Sent when asset is shipped

16
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Inputs
• Construction Work Order

– If asset is built by company
• Fixed Asset Change Form
– Transfer of fixed asset
– Locations, sale, trade, or retirement
• Repair and Maintenance Form
– Notification to update expense and asset accounts

17
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Outputs
• Financial Statement Information
• Fixed Asset Register
– Identification numbers
– Location

• Depreciation Register
– Depreciation Expense
– Accumulated Depreciation

18
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Outputs
• Repair and Maintenance Reports
– Current period expenses

– Historical expenses
• Report on Retired Assets
– Disposal of fixed assets

19
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Fixed Asset Management
Summary

20
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Study Break #2
What is the objective of the fixed asset management function?
A. To track purchases of fixed assets
B. To manage the purchase, management, valuation, and
disposal of an organization’s fixed assets
C. To record maintenance and depreciation of fixed assets
D. To keep a current listing of approved vendors

21
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Study Break #3
Why do companies use BPM solutions for the fixed asset
management function?

A. Decrease machine downtime and maintenance costs
B. Reduce inventory
C. Integrate data and coordinate logistics
D. All of the above

22
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


The Production Process
• Process
– Begins with request for raw materials
– Ends with transfer of finished goods to warehouses

• Primary Objectives
– Converting raw materials to finished goods efficiently
– Collecting and reporting of information

23
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Production Process Flowchart

24
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.


Production Process Objectives
• Track purchases and sales of inventories

• Monitor and control manufacturing costs
• Control inventory
• Control and coordinate the production process
• Provide input for budgets

25
Copyright © 2015. John Wiley & Sons, Inc. All rights reserved.