Transaction Processing in the AIS
Human judgement
IT
assist in posting and utilizing human judgement
essential in accounting cycle
design source documents
make estimates
recognize transaction and record them correctly
internal controls
transaction liimits
numbering of source documents
IT controls
audits
authorization and permissions
Accounting cycle
End of the year
closing entries
items on income statement; nominal accounts
balances to retained earnings
Adjusting entries
estimates
depreciation and bad debt
deferrals
cash first service second
accurals
service first cash second
adjusting entries, adjusted trial balance, financial statements, closing entries and post closing trial balance
prepare financial statements
Record transactions in the AIS
measure dollar amounts
Identify recordable transactions
throughout fiscal year
Obtain, analyze, and record entries to post to ledger and prepare a trial balance
Coding Systems
mnemonic
memory aid; texting language or short hand.
hierarchical
related to block encoding, but with more numbers; more complex
block
charts of accounts; 1=current assets, 2=long term assets, etc
sequencial
checks, invoices purchase orders
numbers in order
Financial statements
cash flows
cash only; period of time
changes in equity
income statement
period of time
balance sheet
point in time
Accounting and bookkeeping
Bookkeeping
part of accounting
Identifying and measuring
Accounting
Informed Judgements and Decisions
Identifying, measuring and communicating
