ACC 535- Ch 1

The text takes the following view of the relationship between an IS and an AIS:

IS and AIS are one in the same

___ is (are) data presented in a form that is useful to decision makers

Information

A man-made system that generally consists of an integrated set of computer-based components and manual components established to collect, store, and manage data and to provide output information to users.

Information system

A system that consists of an integrated set of computer-based and manual components established to collect, store, and manage data and to provide output information to users is a(n)

Information system

The sequence of components in the functional model of an information system is

Input, processing, output, users

Efficiency and effectiveness of operations are goals of:

Internal control

A man-made system consisting of people, authority, organization, policies and procedures whose objective is to accomplish the work of planning and controlling the operations of the organization.

Management process

Decision-making is an activity of the

Management process

An information system

May consist of both computer-based and manual components

Internal control is a process designed to provide absolute assurance regarding achieving objectives in which of the following?

None of the above

The ____ suggests that technology improves information available for decision making

Occupational Outlook Handbook

Regarding management problem structure and information requirements, which of the following represents the vertical information flows from lowest to highest?

Operations and business event processing, operations management, tactical management, strategic management

____ requires information that focuses on the day to day management of the business.

Operations management

A man-made system consisting of people, equipment, organization, policies and procedures with the objective of accomplishing the work of the organization.

Operations process

Accounting is an activity of the

Operations process

Which of the following statements is false?

Operations related and accounting related processes are designed by those external to the organization

The three logical components of a business process include all of the following except

Organization process

Which of the following is one of the three most prominent management activities?

Planning

____ improves the decision maker's capacity to predict, confirm, or correct earlier expectations.

Predictive value and feedback value

The three themes of the Text book include all of the following except

Risk assessment

The AICPA has identified all but which of the following as assurance services?

Consulting

E-business does not include

ERP Systems

Enterprise systems can include

ERP systems

Which of the following is an unstructured decision?

1. No agreed upon decision-making method 2. No proven optimal solution 3. Are often a collaborative process

Historically, the relationship between an information system and an accounting information system has been:

AIS is part of the IS

The correspondence or agreement between the information and the actual events or objects that the information represents is known as

Accuracy

Which of the following is NOT one of the three steps in decision making as described in the text.

Action

Which of the following questions might the accountant answer in the design of the AIS?

All the above

A primary reason that the FASB requires that GAAP be consistently applied from one period to the next is

Comparability

The information quality that enables users to identify similarities and differences in two pieces of information is

Comparability

The degree to which information includes data about every relevant object or event necessary to make a decision is

Completeness

The _____ is violated when a firm uses straight-line depreciation one year and changes to declining balance depreciation the next year.

Consistency principle

____ are facts and figures in raw form.

Data

The central repository for all the data related to the enterprise's business activities and resources

Enterprise database

According to the Sarbanes-Oxley Act of 2002 and PCAOB Auditing Standard No. 5, management must audit and report on auditors' assertions about the organizations' systems of internal controls.

False

As a designer of an AIS the accountant will test a new system's controls

False

As a user of an AIS an accountant must know how systems are developed.

False

E-business is the application of electronic networks to undertake business processes among the functional areas in an organization.

False

In an assurance service the accountant will provide the original information used for decision making.

False

Information about a customer's credit history that is received after the decision to grant additional credit lacks completeness.

False

Internal control is a process that provides complete assurance that the organization is meeting its objectives, such as efficiency and effectiveness of operations and reliable reporting.

False

Strategic management required more detailed information than operations management.

False

The MIS is a subsystem of the AIS

False

The Sarbanes Oxley Act of 2002 applies to publicly traded companies and not-for-profit entities.

False

The management process includes marketing and sales.

False

The most important information for tactical management involves information about the organization's environment.

False

The three themes of the text are operating systems, e-business, and internal control.

False

To be reliable information must be relevant

False

All of the following are components of reliability except: (validity, accuracy, verifiability)

Feedback value

Which of the following is an element of the operations process?

Production

Generally, which of the following is NOT one of the three roles an accountant typically fills in relation to the AIS?

Programmer

The Sarbanes-Oxley Act of 2002 dramatically changed the daily work of financial accountants and auditors because it

Required that external auditors report on the effectiveness of an organization's system of internal controls

______ requires information to assess the environment and to project future events and conditions.

Strategic management

At which level of the organization are decisions most unstructured?

Strategic management level

A system can be further divided into

Subsystems

A set of interdependent elements that together accomplish specific objectives is a

System

Which of the following statements is false?

Tactical management uses the most detailed and accurate information.

If information arrives too late to impact a decision, then there is a problem with

Timeliness

According to the Sarbanes-Oxley Act of 2002, management must identify, document, and evaluate significant internal controls.

True

According to the Sarbanes-Oxley Act's Section 409, material changes in the organization's financial condition must be disclosed to the public on a rapid and current basis.

True

Accuracy is the correspondence or agreement between the information and the actual events or objects that the information represents.

True

An information system consists of and integrated set of computer-based and manual components established to provide information to users

True

Billing/accounts receivable is traditionally part of the AIS.

True

Deciding how much credit to grant to a customer is a structured decision.

True

Enterprise systems integrate an organization's business processes and information from all of an organization's functional areas.

True

Historically the purpose of an accounting information system is to collect, process, and report financial aspects of business events.

True

Information systems reliability and electronic commerce have been identified by the AICPA as potential assurance services

True

Information that is capable of making a difference in a decision-making situation, by reducing uncertainty or increasing knowledge for that particular decision, has the quality of relevance.

True

Operations management requires information that is more accurate and timely than strategic management

True

Production and personnel are part of the operations process.

True

SOX Section 404 compliance is a major line of business for the biggest accounting firms

True

Strategic managers use more information from outside the organization than do operations managers.

True

The Sarbanes-Oxley Act of 2002 has dramatically changed the daily work of financial accountants and auditors.

True

The Sarbanes-Oxley Act's Section 404 creates changes in both how companies document and evaluate internal control and how auditors audit and report on internal control.

True

The role of the accountant has evolved to include non-financial information and information technology.

True

The three steps in decision making take place in the sequence of (1) intelligence (2) design (3) choice.

True

What controls will be necessary is a question that an accountant answers in the design of the AIS.

True

All of the following are components of relevance except: (feedback value, predictive value, & timeliness)

Verifiability

The ability of more than one individual to come to the same measurement is known as

Verifiability

Which of the following statements is true?

With a more structured decision, there is a need for well defined, more accurate data.