TUNKU PUTERI INTAN SAFINAZ SCHOOL OF ACCOUNTANCY

BKAS2013 ACCOUNTING INFORMATION SYSTEMS A221 (C & G)

ASSOC. PROF. DR. AKILAH ABDULLAH

EXERCISE FOR TOPIC 1 INTRODUCTION TO AIS

QUESTION 1

(a) Differentiate between horizontal and vertical flows of information in an organization.

(b) Differentiate between financial and non-financial transactions that are processed by an information
system.

QUESTION 2

Accounting Information System (AIS) is a system that comprises of several subsystems that include
Transaction Processing Systems (TPS), General Ledger/Financial Reporting Systems (GL/FRS) and
Management Reporting Systems (MRS).

REQUIRED:

(a) Explain the different functions of GL/FRS and MRS.

(b) Indicate whether each of the following activities is being performed by GL/FRS or MRS:
(i). Produce a monthly variances report for the production manager to review the production
efficiency.
(ii). Prepare a Trial Balance for the year ended 31 December 2016.
(iii). Generate a monthly sales report (by product categories) for sales manager analysis.
(iv). Prepare a Cost-Volume-Profit analysis for newly produced products.

QUESTION 3

(a) Identify the appropriate characteristics of useful information for the descriptions given.

(i) Does not omit important aspect of the underlying events or activities that are measures.
(ii) Presented in a useful and intelligible format.
(iii) Reduces uncertainty, improves decision makers’ ability to make predictions
(iv) Free from error and bias and accurately represents the events or activities of the
organization

(b) Briefly explain TWO (2) reasons why accountant need to understand organizational structure.

(c) Differentiate between system and subsystem.

(d) Differentiate between system decomposition and system interdependency.

QUESTION 4

A. State TWO (2) types of data sources in AIS model.

B. Compare the accountant roles as system auditors in Accounting Information Systems (AIS).
C. Classify the following uses of information as internal user or external user of Accounting
Information Systems (AIS).
(i) Chief Financial Officer
(ii) Regulatory Agencies
(iii) Promotion Manager