Chapter 1 Key Terms b

intranet

a company's private network accessible only to the employees of that company. Uses the common standards and protocols of the Internet, but the computer servers of the intranet are accessible only from internal computers within the company.

automated matching

a computer hardware and software system in which the software matches an invoice to its related purchase order and receiving report.

LAN (local area network)

a computer network that spans a relatively small area, confined to a single building or group of buildings and are intended to connect computers within an organization.

enterprise resource planning (ERP)

a multi-module software system designed to manage all aspects of an enterprise. Usually broken down into modules such as financials, sales, purchasing, inventory management, manufacturing, and human resources.

enterprise risk management (ERM)

a process, effected by an entity's board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.

point of sale system (POS)

a system of hardware and software that captures retail sales transactions by standard bar coding. As a customer checks out through the cash register, the bar codes are scanned on the items purchased, prices are determined by access to inventory and price list data, sales revenue is recorded, and inventory values are updated.

corporate governance

an elaborate system of checks and balances whereby a company's leadership is held accountable for building shareholder value and creating confidence in the financial reporting processes.

data warehouse

an integrated collection of enterprise-wide data that includes five to ten fiscal years of nonvolatile data, used t support management in decision making and planning.

evaluated receipt settlement (ERS)

an invoice-less system in which computer hardware and software complete an invoice-less match comparing the purchase order with the goods received. If the online purchase order matches the goods; payment is made to the vendor.

general controls

apply overall to the IT accounting system; they are not restricted to any particular accounting application.

operational database

contains the data that are continually updated as transactions are processed. Usually includes data for the current fiscal year and supports day-to-day operations and record keeping for the transaction processing systems.

characteristics of EDI

inter-company is two or more companies conducting business electronically, computer-to-computer that each company's computers are connected via the network, and standard business format is necessary so that various companies, vendors, and sellers can interact and trade electronically by means of EDI software.

batch processing

requires that all similar transactions be grouped together for a specified time; then this group of transactions is processed as a batch.

extranet

similar to an intranet except that it offers access to selected outsiders, such as buyers, suppliers, distributors, and wholesalers in the supply chain.

real-time processing

some online processing systems that the transaction is processed immediately, and in real time, so that the output is available immediately.

E-payable and electronic invoice presentment and payment (EIPP)

terms that refer to Web-enabled receipt and payment of vendor invoices.

internet

the global computer network (information super-high-way). The network that serves as the backbone for the World Wide Web.

electronic data interchange (EDI)

the inter-company, computer-to-computer transfer of business documents in a standard business format.

IT governance

the leadership, organizational structure, and processes that ensure that the enterprise achieves its goals by adding value while balancing risk versus return over IT and its processes; provides the structure that links IT processes, IT resources, and information to enterprise strategies and objectives.

online processing

the opposite of batch processing. Transactions are not grouped into batches, but each transaction is entered and processed one at a time.

data mining

the process of searching data within the data warehouse for identifiable patterns that can be used to predict future behavior.

E-business

the use of electronic means to enhance business processes that encompass all forms of online electronic trading--consumer-based e.commerce and business-to-business transactions, as well as the use of IT for process integration inside organizations.

network

two or more computers linked together to share information and or resources.

application controls

used specifically in accounting applications to control inputs, processing, and output and are intended to ensure that inputs are accurate and complete, processing is accurate and complete, and outputs are properly distributed, controlled, and disposed of.

indexed sequential access method

when both access methods are necessary, files are stored sequentially, but can be accessed randomly because an index allows random access to specific records.

WAN (wide area network)

when two or more LAN's are connected via other network connections.