AIS

PART 1: ENUMERATION
1. WHAT ARE THE TYPES OF TRANSACTION
● Financial transaction
● Non-Financial transaction
2. THREE TYPES OF AIS SUBSYSTEMS
● TPS - Transaction Processing System
● GL/FRS - General Ledger/Financial Reporting System
● MRS - Management Reporting System
3. DATA - INFO
● Data collection
● Data processing
● Data Management
● Info generation
4. 2 types of Users of Acctg Info
● Internal users
● External users
5. 3 types of internal users
● Management
● Employees
● Owners
6. 5 types of external users
● Creditors
● Tax authorities
● Investors
● Customers
● Regulatory authorities
7. Organizational structure
● Responsibility
● Authority
● Accountability
8. 3 types of accountants as system auditors
● External audit
● Internal audit
● Fraud audit
9. 2 major sub-systems of revenue cycle
● Sales Order Processing Subsystem
● Cash Receipt Subsystem
10. 2 main section of revenue cycle
● Conceptual Revenue Cycle
● Physical System
11. 3 processes constitute revenue cycle
● Sales Order Procedure
 ● Sales Return Procedure
● Cash Receipts Procedure
12. Reasons for sales return
● shipped wrong merchandise
● goods were defective
● product was damaged in shipment
● buyer refused deliver because the seller shipped the goods too late or they were
delayed in transit
13. Conceptual sales return procedure
● Prepare return slip
● Prepare credit memo
● Approve credit memo
● Update Sales Journal
● Update Inventory & Accounts Receivable records
● Update General Ledger
14. Conceptual cash receipts procedure
● Open mail and prepare remittance advice
● Record and deposit checks
● Update accounts receivable
● Update general ledger
● Reconcile cash receipts and deposits
15. 5 control activities
● Transaction authorization
● Segregation of duties
● Supervision
● Accounting Records
● Access
● Independent verification
16. Manual Sales Order Process
● Sales department
● Credit department approval
● The shipping department
● Billing department
17. Manual Sales Return Procedures
● Receiving department
● Sales department
● Processing the credit memo
18. Cash Receipt Procedure
● Mail room
● Cash receipt
● Accounts receivable
● General ledger
● Controller's office
19. Automatic Sales Order Processing with Batch Technology
● Sales department
● Credit department approval
● Warehouse procedure
● Shipping department
20. Reengineered Sales Order Processing with Real-Time Technology
● Sales Procedure
● Warehouse Procedure
● Shipping department
21. General Ledger Update Procedure
● Inventory-control
● Sales
● AR control
● and Cost of goods sold
22. Automated Cash-Receipt Procedure
● Mail room
● Cash receipts department
● AR department
● Data processing department
23. What comprises the Computer Based System (2 points each)
● Automatic Sales Order Processing with Batch Technology
● Reengineered Sales Order Processing with Real-Time Technology
● General Ledger Update Procedure
● Automated Cash-Receipt Procedure
● Reengineered Cash-receipt procedure
24. What is the conceptual Procurement Cycle
● Purchase Requisition
● Purchasing
● Receiving/Inspection
● Accounts Payable
● Cash Disbursement
25. Goals of Expenditure Cycle (2pts each)
● purchase from reliable vendors
● purchase high quality items
● obtain best possible price
● purchase only items that are properly authorized
● have resources available when they are needed
● receive only those items ordered
● ensure items are not lost, stolen, or broken
● pay for the items in a timely manner
26. What is the Manual Manual Disbursements (2pts each)
● prepares the check
● records the information in a check register (cash disbursements journal)
● Check will be released and pays the account due.
 ● returns paid vouchers to accounts payable
● sends a journal voucher to G/L:
27. What consist the Master File?
● supplier (vendor) master file
● accounts payable master file
● Inventory master file
28. In Expenditure Cycle, what consists the Transaction and Open Document Files
● purchase order file
● open purchase order file
● supplier’s invoice file
● open vouchers file
● cash disbursements file
29. What consist the Traditional Segregation of Duties
● Warehouse (stores)
● Inventory control
● Accounts payable
● General ledger
● Requisitioning
● Purchases
● Purchases returns and allowances
● Cash disbursements
30. What is the conceptual system in the Payroll System: Concept
● Personnel Department
● Production Department
● Payroll Preparation
● Paycheck Distribution
● Accounts Payable Preparation
● Cash Disbursement
● Update General Ledger
31. What is the Conceptual system in the Fixed Asset System: Concept
● Asset Acquisition
● Asset Maintenance
● Asset Disposal
32. What are the 3 Production Method
● Continuous Processing
● Make-to-order Processing
● Batch Processing
33. What are the documents need in the Batch Processing System
● Production Schedule
● Bill of materials
● Route Sheets
● Work Order
● Move Tickets
● Materials Requisition
34. What are the Production Planning and Control processes
● Materials and Operation Requirement
● Productions Scheduling
● Work Centers and Storekeeping
35. What are the types of Transaction Cycles
● The Expenditure Cycle
● The Conversion Cycle
● The Revenue Cycle
36. Sub System under expenditure cycle
● Purchases/accounts Payable (AP) System.
● Cash Disbursements System
● Payroll System
● Fixed Asset System
37. What are the documentation techniques
● Data Flow Diagrams
● Entity Relationship Diagrams
● System Flowcharts
● Program Flowcharts
● Record Layout Diagrams
38. What is the difference between Batch and Real Time Systems
● Information Time Frame
● Resources
● Operational Efficiency
● Efficiency versus Effectiveness
39. What are the Data Coding schemes
● A SYSTEM WITHOUT CODES
● A SYSTEM WITH CODES
● NUMERIC AND ALPHABETIC CODING SCHEMES
40. What are the Numeric and Alphanumeric coding schemes
● SEQUENTIAL CODES
● BLOCK CODES
● GROUP CODES
● ALPHABETIC CODES
● MNEMONIC CODES
41. Under Financial Reporting System, give the procedures for Financial Reporting
● Capture the transaction
● Record in special journal
● Post to subsidiary ledger
● Post to general ledger
● Prepare the unadjusted trial balance
● Make adjusting entries
● Journalize and post adjusting entries
● Prepare the adjusted trial balance
● Prepare the financial statements
 ● Journalize and post the closing entries
● Prepare the post closing trial balance
42. What are the factors that Influence the Management Reporting System
● management principles
● management function, level, and Decision type
● problem structure
● types of management reports
● responsibility accounting
● behavioral Considerations.

43. What are the principles that most directly influence the MRS
● formalization of tasks
● responsibility and authority
● span of control
● management by exception.
44. What are the classification of planning and control decisions
● strategic planning
● tactical Planning
● managerial control
● operational control
45. What are the most common form of responsibility centers
● Cost centers
● profit centers
● Investment centers.
46. What are the main issues of computer ethics
● Privacy
● Security
● Ownership of Property
● Equity in Access
● Environmental Issues
● Artificial Intelligence
● Unemployment and Displacement
● Misuse of Computers
47. 3 Levels of Computer Ethics
● “Pop” Computer Ethics
● “Para” Computer Ethics
● “Theoretical” Computer Ethics
48. What are the factors that contribute to Fraud
● Pressure
● Opportunities
● Ethics
49. Four Principal types of Corruption’
● Bribery
● Illegal Gratuities
 ● Conflict of Interest
● Economic Extortion
50. What are the examples of Asset Misappropriations
● Skimming
● Cash Larceny
● Check Tampering
● Payroll Fraud
● Expense reimbursement
● Thefts of cash
● Non cash misappropriation
● Computer Fraud
51. Important elements of the control environment include the following? (2 pts each)
● Integrity and ethical values of management
● ­Organizational structure of the company
● ­Participation of the organization’s board of directors and of the audit committee
● ­Management's philosophy and operating style
● ­Methods for evaluating performance
● ­External influences, such as examinations by outside parties
● ­Organization's policies and practices for managing its human resources
52. The COSO framework consists of five components:
● Control Environment
● Risk Assessment,
● Information and Communication
● Monitoring
● Control Activities
53. Management should adopt the provisions of the Sarbanes-Oxley Act by:
● Separate CEO and chairman
● Set ethical standards
● Establish an Independent Audit Committee
● Compensation Committees
● Nominating Committees
● Access to Outside Professionals
54. According to law, to be called the act as fraud, it should meet the five conditions namely:
● False representation -
● Material Fact -
● Intent -
● Justifiable reliance -
● Injury or loss
55. Common Types of Fraud
● Fraudulently Statements
● CORRUPTION
● ASSET MISAPPROPRIATION
Part II - True or False - Write False if the statement is true or correct, write True if the
statement is false or wrong.

False 1. A transaction is an event that affects or is of interest to the organization and is

processed by its information system as a unit of work.

False 2. Financial Transaction - Economic events that affect the assets and equities of an
entity.

False 3. Non-Financial Transactions - All other events processed by the organization's

information system.

False 4. Accounting information is presented to internal users usually in the form of

management accounts, budgets, forecasts and financial statements.

False 5. External Auditors - Certify the fairness of the presentation of financial statements.

False 6. Internal Audit -An independent appraisal function established within an organization to
examine and evaluate its activities as a service to the organization.

False 7. Fraud Audit - Investigate anomalies and gather evidence of fraud.

True 8. Revenue Cycle - It is the indirect exchange of finished goods or services for cash in a
single transaction between a seller and a buyer.

(True) 9. Conceptual System Is the overview of movement of accounting information through

external organization. It also reviews the internal control issues.

True 10. Sales order procedure involved receiving and processing a customer order, filling the
order and skipping products to the customer at the proper time, and correctly accounting for the
transaction.

True 11. Cash Receipts Procedure - involve deceiving and securing the cash; depositing the
cash in bank; matching the payment with the customer and adjusting the correct accounts; and
properly accounting for and reconciling the financial details of the transaction.

True 12. Manual Systems - the purpose is not to support the system concepts presented in the
previous section with models depicting people, organizational units, and physical documents
and files.
True 13. False representation is a false statement, not based on unreliable sources and already
manipulated by someone to take advantage of it.

True 14. White collar crimes - It refers to crime that is done with violence needed to perform it.

True 15. Management Fraud - It is the crime done by the people in low positions.

False 16. Bribery - Offering or giving someone things or opportunities to make him do the act

False 17. Economic Extortion - Is the use of force by an individual to obtain something of value

False 18. Check Tampering - Forging or changing in some material way of the check.

False 19. Transaction Processing System is an information processing system for business
transactions involving the collection, modification and retrieval of all transaction data.

False 20. Transaction Cycles are the means through which an accounting system processes
transactions of related activities such as sale of goods to customers, acquisition of merchandise
and payment to vendors, production of finished products for sale, and payment to employees for
services they had rendered.

False 21. Purchases/accounts Payable (AP) System. This system recognizes the need to
acquire physical inventory (such as raw materials) and places an order with the vendor

False 22. Revenue Cycle - which involves processing cash sales, credit sales, and the receipt
of cash following a credit sale. /

False 23. Accounting records are the original source documents, journal entries, and ledgers
that describe the accounting transactions of a business.

False 24. Journals is a chronological record of financial transactions.

False 25. Ledgers show activity by account type

False 26. The general ledger (GL) summarizes the activity for each of the organization's
financial accounts.

False 27. archive file contains records of past transactions that are retained for future reference
and form an important part of the audit trail.
False 28. The program flowchart is a data flow that shows the data flow while writing a program
or algorithm.

False 29. System flowchart is the graphical representation of the physical relationships among
key elements of a system.

False 30. Batch processing involves gathering transactions into groups or batches and then
processing the entire batch as a single event.

Part III - IDENTIFICATION - Write the answer in the answer sheet

1. It identifies, collects, processes, and communicates economic information about a firm using
a wide variety of technologies. It gets and records the financial effects of the firm's transactions.
- Accounting Information System
2. Is an event that affects or is of interest to the organization and is processed by its information
system as a unit of work.
● Transactions
3. Economic events that affect the assets and equities of an entity
● Financial Transaction
4. All other events processed by the organization's information system.
● Non-Financial Transactions
5. Supports daily business operations.
● Transaction Processing System (TPS)
6. Produces financial statements and reports.
● General ledger/ Financial Reporting System (GL/FRS)
7. Produces special-purpose reports for internal use.
● Management Reporting System (MRS)
8. Include suppliers as well as lenders of finance such as banks.
● Creditors
9. Uses symbols to represent the entities, processes, data flows, and data stores that pertain to
a system.
● Data Flow Diagrams
10. Is a documentation technique used to represent the relationship between business entities.
● Entity Relationship Diagrams
11. Is the graphical representation of the physical relationships among key elements of a system
● System Flowcharts
12. is a data flow that shows the data flow while writing a program or algorithm.
● Program Flowchart
13. These are used to reveal the internal structure of digital records in a flat-file or database
table
 ● Record Layout Diagrams
14. Involves gathering transactions into groups or batches and then processing the entire batch
as a single event.
● Batch processing
15. Process individual transactions continuously as they occur.
● Real-time processing

16. Represent items in some sequential order (ascending or descending).

● SEQUENTIAL CODES
17. Is a variation on sequential coding that partly remedies the disadvantages just described.
This approach can be used to represent whole classes of items by restricting each class to a
specific range within the coding scheme.
● BLOCK CODES
18. Numeric group codes are used to represent complex items or events involving two or more
pieces of related data.
● GROUP CODES
19. Are used for many of the same purposes as numeric codes
● ALPHABETIC CODES
20. Are alphabetic characters in the form of acronyms and other combinations that convey
meaning
● MNEMONIC CODES
21. Involved receiving and processing a customer order, filling the order and shipping products
to the customer at the proper time, and correctly accounting for the transaction.
● Sales order procedure
22. Involve receiving and securing the cash, depositing the cash in bank, matching the payment
with the customer and adjusting the correct accounts, and properly accounting for and
reconciling the financial details of the transaction.
● Cash Receipts Procedure
23. These are internal control activities that will guide us in designing and evaluating transaction
processing controls.
● Revenue Cycle Controls
24. Involves using technology to improve the efficiency and effectiveness of a task.
● Automation Computer based systems
25. Involves radically rethinking the business process and workflow.
● Reengineering
26. Is a bookkeeping system where records are maintained by hand, without using a computer
system. Instead, transactions are written in journals, from which the information is manually
rolled up into a set of financial statements.
● MANUAL SYSTEM
27. Are the result of transaction processing rather than the triggering mechanism for the process
● PRODUCT DOCUMENTS
28. Economic events result in the creation of some documents at the beginning (the source) of
the transaction.
● SOURCE DOCUMENTS
29. Are used to record specific classes of transactions that occur in high volume. Examples:
cash receipts journal, cash disbursements journal, payroll journal, purchases journal, and sales
journal
● SPECIAL JOURNALS