Deck 12 Accounting Information Systems Romney and Steinbart

1. Deck 12 Accounting Information SystemsRomney and Steinbart Linda Batch March 2012

2. Learning Objectives • AIS Development Strategies (Chapter 21) • Ways to acquire an AIS • BPM and BPMS • Systems Development (Chapter 22) • Conceptual systems design process (5 steps) • Physical systems design process • Systems implementation and conversion – important • Microsoft Access • Creating Macros and Switchboard • Work on Assignment 4 • Quiz (Chapter 9, 10)

3. Chapter 21 – AIS Development Strategies • Definitions • Canned Software – sold to users with similar requirements • Turnkey solutions – software and hardware sold as a package and are usually specialized in a particular industry • Application Service Providers – provide software over the internet • End User Computing – end users develop their own IT tools • Purchase an AIS • The process follows the same Systems Development Life Cycle except • they must determine if the market can provide them a viable solution • some physical design and conversion activities may be omitted

4. Chapter 21 – Auditing Computer Based AIS • In House Development of AIS • Different levels between customizing purchased software and full in-house computer programming • End User computing is when the Users develop their own IT tools • Outsourcing the AIS • Advantages include lower costs, shorter development time, elimination of peak and valley usage, asset utilization • Disadvantages include reduced competitive advantage, locked in system, poor service, increased risk, inflexibility, loss of control • Prototyping the AIS • A systems design approach in which a simplified working model of a system is developed • Operational prototypes is where you put it into production • Used when there is a high level of uncertainty

5. Chapter 21 – AIS Development Strategies • Business Process Management (BPM) and BPMS • Systematic approach to continuously improving and optimizing your business processes which is automated and facilitated by systems solutions • Business Processes: • produce competitive advantage • must be managed end to end • should be agile • should be aligned with organizational strategy and needs • ERP systems integrate BPMS functionality into their system • Computer Aided Software Engineering • Integrated package of tools that skilled designers use to help plan, analyze, design, program, maintain an information system

6. Chapter 22 – Systems Design, Implementation, Operation Systemsanalysis Conceptual System Design Physical Design Implementation And Conversion Operation and Maintenance

7. Chapter 22 – Systems Design, Implementation, Operation

8. Chapter 22 – Systems Design, Implementation, Operation

9. Chapter 22 – Systems Design, Implementation, Operation • Systems Physical Design • The conceptual design is translated into detailed specifications that are used to code and test the computer programs • Hardware implementation and upgrades are part of this process • Systems Implementation • The plan consists of implementation tasks, expected completion dates, cost estimates, and who is responsible for each task • People must be hired/transferred to meet the business requirements • Prepared systems development documentation, operations documentation, and user documentation • System must be tested via walkthroughs, processing test data and acceptance testing. Users develop the criteria for acceptance and make the final decision whether to accept the AIS. • Integrated test facility (ITF) where a fictitious division is created and transactions are created that will not be included in the corporate results • Snapshot technique where select transactions are tagged with a special code and these are reviewed by internal audit • Systems Control Audit Review file (SCARF) – continually monitors transactions and collects them into a log for periodic review

10. Chapter 22 – Systems Design, Implementation, Operation • Systems Conversion • Conversion is changing from the old to the new AIS system • Hardware, software, data files and procedures must be converted • Direct conversion • terminates the old system when the new one starts up • The conversion plan must consider the requirements for data retention for statutory requirements such as tax audits etc. • Unless a system has been carefully tested there is no backup in the event the system does not operate • Parallel Conversion • The two systems are run in parallel for a period of time • Risk of record duplication, fraud losses, costly

11. Chapter 22 – Systems Design, Implementation, Operation • Systems Conversion • Phase in Conversion • Gradually replaces parts of the AIS • Additional costs of building and testing system interfaces • Pilot conversion • Implements a system in one part of the organization such as a branch location • Long conversion time and requirement to build interfaces

12. Chapter 21 and 22 – Review for Final • Acquiring a system • Definitions (slide 4) • Ways to acquire an AIS (slide 4 and 5) • Purchase • Build in House • Outsource • Prototype • Business Process Management and Business Process Management Systems (slide 6) • Computer Aided Software Engineering (slide 6) • Five steps to developing an AIS (slide 7) • System Conversion – know what it is and be able to discuss briefly the four types (as per these slides)