The Institute of Chartered Accountants of Bangladesh

Accounting Information System

Presented By
Engr. Md. Fazlul Kader
Assistant Professor, Dept. of APECE
University of Chittagong, Bangladesh
 Contents
 Accounting Information System
 Accounting information Systems
Technology
 Accountant's Role in General
 Developing new Accounting Information
System

Engr. Md Fazlul Kader

 Accounting Information System

 Accounting Information System is the system

that combines the study and practice of
accounting with the design, implementation, and
monitoring of information systems.

Engr. Md Fazlul Kader

 Accounting information Systems
(AIS)Technology
 Accounting information Systems Technology follows three basic
operations:
 Input: input devices associated with AIS includes
 standard personal computers or workstations running applications;
 scanning devices for standardized data entry,

 electronic communication devices for EDl and e-commerce etc.

 Process: Basic processing is achieved through computer systems ranging

from individual personal computers to large scale enterprise servers.
 Output: Output devices include computer displays, printers, and electronic
communication devices for EDl and e-commerce etc.
 The output content may encompass almost any type of financial

reports from budgets and tax reports to multinational l financials

statements.

Engr. Md Fazlul Kader

 Accountant's Role in General

 Major activities:
 observation,
 measurement, and
 communication.
 These activities are analytical in nature and draw on several other disciplines
{e.g., economics, mathematics, behavioral science}
 Now, the accountant's role has been expanding within
organizations and they are becoming part of management end
decision-making team.
 There are two key reasons that accountant should care about new
system projects:
 First they cost money- often big bucks.

 Second, the quality of the accounting information system is a

function of the process that produces them.

Engr. Md Fazlul Kader
 Developing a New accounting Information
System and Accountant's Role

 The development of accounting information

systems follows all the five basic phases of
SDLC:
 Planning
 Analysis
 Design
 implementation and
 operation and maintenance.

Engr. Md Fazlul Kader

Steps of a AIS development

Engr. Md Fazlul Kader

 Phases/Sub-phases of a AIS
development
 Establishing & recording user requirements
 Investigation & feasibility study
 Project Management
 Developing a solution to fulfill requirements
 Initial system design (including controls and security)
 Technical information and systems requirements
 Specification of hardware and software
 Implementing security requirements
 Installing/ implementation
 Testing
 System Conversion and start-up
 Post implementation review

Engr. Md Fazlul Kader

 Steps of a AIS development
 Initial Preparation:
 Should clearly define our goals and objectives for the new
information systems.
 Following elements also should be considered:
 current business plan
 Annual operating budget including expenditures for IS
 Preliminary cash flow analysis to determine the financial
feasibility of the new system
 Formalized policies and practices, updated as appropriate
 Complete and accurate historical records
 Comprehensive system of internal controls
 Adequate infrastructure, or plans to upgrade the infrastructure
 Computer-literate personnel, or plans to enhance staff
capabilities Engr. Md Fazlul Kader
 Steps of a AIS development
 Establishing and Recording User Requirements
 This stage includes the following works:
 List of the major user requirements

 Templates or scripts to guide the work for these tasks

 Time and staffing budgets

 Initial schedule or time line

 Work packets for the team

 Define the project deliverables

 Tools used
 Narrative (written description)
 Flowcharts
 Diagrams
 Other written material

Engr. Md Fazlul Kade

 Steps of a AIS development

 Accountant role in Establishing and Recording User

Requirements
 They answer question such as:
 What data should be entered and stored based on user
requirements?
 Who should be able to access the data?
 How should the data be organized, updated, recorded,
accessed, and retrieved?
 How can scheduled and unanticipated information
needs be met?

Engr. Md Fazlul Kader

 Steps of a AIS development

 Investigation and feasibility study

 The purpose of the preliminary investigation is
 To define the problem or enhancement accurately
 Identify the causes or sources of problem
 Determine whether or not the problem or enhancement
identified is worth pursuing
 Determine whether that project is feasible, or,
achievable given the organizational resources and
constraints.

Engr. Md Fazlul Kader

 Steps of a AIS development

 Investigation and feasibility study

Figure : Phases in the cycle including investigation

Engr. Md Fazlul Kader
 Steps of a AIS development

 Feasibility study
 Feasibility study is a user-oriented overview of the proposed
information systems purpose & feasibility.
 The feasibility study investigates the problem and the information
needs of the stakeholders.
 The feasibility of a proposed solution is evaluated in
terms of its components. These components are:
 Economic Feasibility
 Technical feasibility
 Operational feasibility

Engr. Md Fazlul Kader

 Steps of a AIS development

 The feasibility study is an evaluation and analysis of the potential

of a proposed project which is based on extensive investigation and
research to support the process of decision making.
 Economic Feasibility:
 The economic viability of the proposed system.
 The proposed projects cost and benefits are evaluated.
 Technical Feasibility
 The possibility that the organization has or can procure the necessary
technical resources.
 It is an evaluation of the hardware and software and how it meets the
need of the proposed system.
 Operational Feasibility
 The ability, desire and willingness of the stakeholders to use, support,
and operate the proposed computer information systems.
 Steps of a AIS development

 The accountant’s roles in terms of feasibility study

 Preparation of feasibility report
 Investigation of the performance/operations of
competing business organizations to assist
management in policy formulation.

Engr. Md Fazlul Kader

 Project Management

Figure : Phases related to management controls

Engr. Md Fazlul Kader
 Steps of a AIS development

 Developing a Solution to Fulfill Requirements

 Criteria to develop a solution to fulfill requirements
 Easy to implement
 Less costly
 Ability to generate effective output
 Capability to accommodate the dynamic requirements in the mid of
project
 The accountant’s roles
 has to take an initial note on the expenditure that may be required
to meet the requirements.
 has to prepare an initial solution report including budget, time and
the procedures that are urgent to fulfill the requirements.

Engr. Md Fazlul Kader

 Steps of a AIS development

 Developing a Solution
 Steps of a AIS development

 Initial System Design

 The initial system design is a working version of an
information system or part of the system.
 It is only a preliminary model.
 The major activities of initial systems design are:
 User interface design, data manipulation, and output analysis.
 Process design, output design, and output analysis
 Data design, input validation & processing

Engr. Md Fazlul Kader

Steps of a AIS development

Figure : System design in operation

 Steps of a AIS development

 Systems justification and selection in initial system design

 Steps of a AIS development

 System design is divided between accountants and IT

professionals as follows:
 The accounting function is responsible for conceptual systems
 The IT function is responsible for physical systems
 In conceptual systems, the accountant determines
 the nature of the information required,
 its sources,
 its destination, and
 the accounting rules that need to be applied in initial system
design.
 Besides, the accountant plays important role regarding
control and security issues of initial system design.

Engr. Md Fazlul Kader

THANK YOU

Engr. Md Fazlul Kader