AUO1 – Auditing and Information Systems
Additional Study Questions

Accounting Information Systems
Competency 302.1.1: Nature and Purpose
The student understands the nature and purpose of information systems. * What is the difference between transaction processing systems, management information systems, and decision support systems?
Transaction processing systems - document financial activities
Management information systems - used to collect qualitative as well as quantitative information for decision making within organizations
Decision support systems - help the developers of an AIS identify what information they need for their planning, decision making, and control functions * How is a flowchart used?
A document flowchart traces the physical flow of documents through an organization—that is, the flow of documents from the departments, groups, or individuals who first created them to their final destinations. * How is the accounting information system documented?
An accounting information system is a collection of data and processing procedures that creates needed information for its users. An information system's components: Data or information is input, processed, and output as information for planning, decision-making, and control purposes.
Nine reasons to document an AIS are (1) to explain how the system works, (2) to train others, (3) to help developers design new systems, (4) to control system development and maintenance costs, (5) to standardize communications among system designers, (6) to provide information to auditors, (7) to document a business’s processes, (8) to help a company comply with the Sarbanes-Oxley Act of 2002 and AS5, and (9) to establish employee accountability for specific tasks or procedures.
They are documented by: 1. Data flow diagrams provide both a physical and a logical view of a system, but