In automated accounting systems, information technology (IT) serves as a platform on which other system components rely. The purpose of this chapter is to discuss IT subjects in detail—especially as they relate to AISs. Because most students in AIS courses have already taken a survey computer class, the discussions here are brief. This chapter may nonetheless serve as a review of computer hardware and software concepts or as a study of how IT helps organizations accomplish strategic accounting goals.
It is helpful to view an accounting information system as a set of five interacting components: (1) hardware, (2) software, (3) data, (4) people, and (5) procedures. Computer hardware is probably the most tangible element in this set, but ‘‘hardware’’ is only one piece of the pie—and not necessarily the most important piece. For example, most organizations spend more money on people (in wages and salaries) than on computer hardware and software combined. Similarly, computer hardware must work together with the other system components to accomplish data processing tasks. Without computer software, for example, the hardware would stand idle. Without data to process, both the hardware and the software would be useless. Without procedures, accounting data could not be gathered accurately or distributed properly. And finally, without people, it is doubtful that the rest of the system could operate for long or be of much use.
What all this means is that ‘‘information technology’’ is a fuzzy term that includes more than computer hardware. In this chapter, we concentrate on computer hardware (in the next three sections of the chapter) and software (in the final section). But you should remember that these items must interact with all the other system components to create successful AISs.

Simkin, Mark G. (2012-05-01). Core Concepts of Accounting