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AIS 311 Group 1 1

accounting information system

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0% found this document useful (0 votes)
17 views8 pages

AIS 311 Group 1 1

accounting information system

Uploaded by

james rojas
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Information System (Is):

 A set of interrelated components that collect (input), manipulate (process), and disseminate data and
information (output) and provide a corrective reaction (feedback) to meet an objective.

 Input - Activity of gathering and capturing raw data


 Processing - Converting data into useful outputs
 Output - Production of useful information, usually in the form of documents and reports
 Feedback - Information from the system that is used to make changes to input or processing activities

The Five Components of an Information System

Hardware
 The physical devices and equipment used in an information system.
 Examples: Computers, servers, keyboards, monitors, storage devices, and networking equipment.

Software:
 The programs and applications that run on the hardware and perform specific tasks.
 Examples: Operating systems (like Windows, macOS), business applications (like Microsoft Office,
accounting software), and database management systems.

Data:
 The raw facts and figures that are processed to generate useful information.
 Examples: Customer records, sales data, inventory levels, and employee information.

People:
 The users who interact with the information system, as well as the IT professionals who manage and
maintain it.
 Examples: Employees, managers, IT support staff, and system administrators.

Processes:
 The procedures and rules that govern how data is collected, processed, and used within the information
system.
 Examples: Data entry procedures, workflow processes, decision-making protocols, and security policies.

An information system can be:


Manual or computerized

THE HISTORY OF INFORMATION SYSTEMS:

1950s-1960s: Data Processing


 First Business Applications of Computers: The 1950s marked the introduction of computers in business
environments. Initially, these computers were large, room-sized machines that were primarily used by
large organizations like government agencies, banks, and large corporations. Their main function was to
automate repetitive, high-volume tasks that were previously done manually.

 Transaction Processing Systems (TPS): The first systems to be widely implemented were Transaction
Processing Systems. TPS handled day-to-day business operations by processing transactions like sales,
payroll, billing, and inventory management. These systems were essential in reducing human error,
increasing processing speed, and maintaining accurate records. For example, in a retail environment, a
TPS would record each sale, update inventory levels, and process customer payments. These systems
processed data in batches, meaning they collected data over a period of time and processed it all at once
(often overnight).

1960s-1970s: Management Reporting


 Management Information Systems (MIS): As computers became more powerful and reliable,
businesses started using them not just for processing transactions but also for managing information that
could help in decision-making. MIS were developed to provide regular reports to managers, giving them
insights into the company’s performance. These reports could include sales figures, production schedules,
financial summaries, and other key metrics. MIS allowed managers to monitor the business and make
informed decisions based on up-to-date information.
 Office Automation Systems (OAS): In addition to MIS, the 1960s and 1970s saw the development of
Office Automation Systems. These systems were designed to support office workers by automating
routine tasks such as typing, filing, and record-keeping. Word processors, for instance, replaced
typewriters, making document creation faster and easier. Spreadsheets automated complex calculations
and data analysis, which previously required manual effort. OAS improved productivity in the workplace by
reducing the time and effort needed to perform everyday office tasks.

1970s-1980s: Decision Support


 Decision Support Systems (DSS): As businesses faced more complex and dynamic environments, the
need arose for systems that could help with more sophisticated decision-making. DSS were developed to
support non-routine, complex decisions, such as strategic planning, resource allocation, and problem-
solving. Unlike MIS, which provided regular, structured reports, DSS allowed users to interact with data,
explore different scenarios, and test various hypotheses. For example, a marketing manager might use a
DSS to forecast the impact of a new advertising campaign by simulating different levels of spending and
market conditions. DSS typically included tools like data modeling, simulation, and "what-if" analysis,
making them valuable for strategic decision-making.

1980s-1990s: Strategic and End User Support


 End-User Computing: During the 1980s, personal computers (PCs) became widely available, and many
employees started using them to manage their own work. End-User Computing refers to the phenomenon
where non-IT professionals began creating their own applications, like spreadsheets and databases, to
support their specific needs. This shift empowered employees to take control of their data and processes,
making them more independent and productive. For instance, a financial analyst might use a spreadsheet
to analyze trends and create reports without needing help from the IT department.

 Intelligent Support Systems (ISS): This period also saw the development of Intelligent Support
Systems, which included expert systems and other AI-driven technologies. Expert systems were designed
to replicate the decision-making abilities of human experts. They stored the knowledge of experts in a
particular field and could provide advice or recommendations to non-experts. For example, an expert
system in medicine might help doctors diagnose diseases by analyzing patient data and comparing it to a
database of medical knowledge. Additionally, early forms of machine learning were being explored,
allowing systems to improve over time by learning from past data.

 Knowledge Management Systems (KMS): As organizations recognized the importance of knowledge as


a key resource, they developed Knowledge Management Systems to capture, organize, and share
knowledge within the company. KMS allowed organizations to leverage their collective expertise, improve
innovation, and maintain a competitive edge. For example, a KMS might store best practices, research
reports, and customer insights, making them accessible to employees across the organization.

1990s-2000s: Global Internetworking


 Mobile Computing: With the rise of mobile technology, information systems were no longer confined to the
office. Mobile computing enabled employees to access information, communicate with colleagues, and
conduct business from virtually anywhere. This was particularly useful for salespeople, field workers, and
managers who needed to stay connected while on the move. For example, a salesperson might use a
mobile device to access customer information, place orders, and update records while visiting clients.

 Global Networks: The 1990s saw the explosive growth of the internet, which transformed information
systems into global networks. Businesses could now connect with customers, suppliers, and partners
around the world in real time. This period marked the rise of e-commerce, where companies could sell
products and services online, reaching a global audience. Additionally, Enterprise Resource Planning
(ERP) systems became popular, integrating all of a company’s processes (such as finance, HR, supply
chain) into a single, unified system that operated across the globe. These systems allowed for real-time
data sharing and collaboration, making businesses more agile and responsive to changes in the global
market.

Herman Hollerith
 Hollerith developed the first punch card-based data processing system, which was used to tabulate
the 1890 U.S. Census. His work led to the founding of the Tabulating Machine Company, which
eventually became IBM. Hollerith’s innovations are considered crucial in the early development of
data processing systems.

COMPUTER SYSTEM
 Is a collection of entities(hardware,software and liveware) that are designed to receive, process, manage
and present information in a meaningful format.
COMPONENTS OF COMPUTER SYSTEM

 Computer hardware - Are physical parts/ intangible parts of a computer. eg Input devices, output
devices, central processing unit and storage devices

 Computer software - also known as programs or applications. They are classified into two classes
namely - system software and application software

 Liveware - is the computer user. Also known as orgware or the humanware. The user commands the
computer system to execute on instructions.

EVOLUTION OF COMPUTER SYSTEM

First Generation – Vacuum Tubes (1940 – 1956)


 Vacuum tube technology was used in the first generation of computer evolution (1940–1956). These
huge, heavy computers produced heat and consumed a lot of power, however they could only handle little
amounts of data. They established electrical digital computing and binary math in spite of numerous
malfunctions and reliability problems, setting the foundation for later developments in computer
technology, such as stored program architecture and the switch to transistor-based computers.
 ENIAC was invented by J.P.Eckert and J.W.Mauchy, which was the first successful electronic computer.
Example
 ENIAC (Electronic Numerical Integrator and Computer)
 UNIVAC (Universal Automatic Computer)

Second Generation: Transistors (1956-1963)


 Transistor technology emerged in the second wave of computer evolution (1956–1963), displacing
vacuum tubes. Computers were smaller and faster because to transistors, which were more dependable,
power-efficient, and compact. Significant improvements in computing power occurred during this era, as
computers became more widely available and easier to use. This led to a rise in computer use across a
range of industries and opened the door for new breakthroughs.
 These computers were dependent on transistors, not vacuum tubes.
Example
 IBM 7094
 UNIVAC 1108

Third generation: Integrated Circuits (1964-1971)


 Computing was transformed by integrated circuit (IC) technology during the third generation of computer
evolution (1964–1971). ICs increased computer capacity while significantly lowering size, cost, and power
consumption by integrating many transistors on a single chip. Smaller, quicker, and more dependable
computers were developed during this time, opening up new applications in industry, government, and
education and providing the groundwork for contemporary computer systems.
 These were based on integrated circuits invented by Robert Noyce and Jack Kilby In 1958-1959. these
were known to contain several transistors.
Example
 PDP-8
 IBM 360

Fourth generation: Microprocessor (1971-Present)


 The introduction of microprocessor technology, which integrated many central processing units (CPUs)
into a single chip, marked the beginning of the fourth generation of computer evolution (1971–present).
This discovery made it possible to create strong, portable, and reasonably priced computers, which in turn
facilitated the widespread use of embedded systems, smartphones, laptops, and personal computers
(PCs).
 These computers were based on microprocessors. A microprocessor is utilized to execute any logical and
mathematical function in any software in a computer.
Example
 IBM 4341
 Apple Macintosh Commodore 64

Fifth-generation: Artificial Intelligence (2010 Onwards)


 The rapid progress of artificial intelligence (AI) technology characterizes the fifth generation of computer
evolution, which began in 2010. Innovations in machine learning, neural networks, and natural language
processing have enabled computers to do complex tasks like language translation, image identification,
and independent decision-making. Intelligent systems that can learn, adapt, and communicate with people
on their own are becoming ever more common in this day and age.
 These machines are based on artificial intelligence. The fifth generation's objective is to produce a device
that can respond to natural language input, learn, and self-organize. This generation depends on the
manufacture of 10 million electrical components for microprocessor chips with ULSI(Ultra Large Scale
Integration) technology.
Example
 Desktop
 Laptop
 Chromebook

MOORE’S LAW
 penned by Gordon Moore in the year 1965.
 it is the observation that the number of transistors on an integrated circuit will double every two years with
minimal rise in cost. Intel co-founder Gordon Moore predicted a doubling of transistors every year for the
next 10 years in his original paper published in 1965. Ten years later, in 1975, Moore revised this to
doubling every two years.

INTRODUCTION TO COMPUTER ARCHITECTURE


Computer Architecture
 defined as the end-to-end structure of a computer system that determines how its components interact
with each other in helping execute the machine’s purpose (i.e., processing data).

Components of Computer Architecture


1. Input unit and associated peripherals
 provides external data sources to the computer system.
 examples are keyboard, mouse, or other input devices are the most often utilized and have corresponding
hardware drivers that allow them to work in sync with the rest of the computer architecture.

2. Output unit and associated peripherals


 delivers the computer process results to the user.
 a computer architecture’s output devices encompass the display, printing unit, speakers, headphones, etc.

3. Storage unit/memory
 the storage unit contains numerous computer parts that are employed to store data. It is typically
separated into primary storage unit and secondary storage unit.

 Primary Storage Unit


 this component of the computer architecture is also referred to as the main memory, as the CPU
has direct access to it.

Two kinds of memory


1. RAM (Random Access Memory)
 supplies the necessary information straight to the CPU.

2. ROM (Read-Only Memory)


 is a memory type that contains pre-installed instructions, including firmware.

 Secondary Storage Unit


 secondary or external storage is inaccessible directly to the CPU. Before the CPU uses
secondary storage data, it must be transferred to the main storage.
 examples are compact discs(CDs), Hard Disk Drives (HDD)

4. Central processing unit (CPU)


 the CPU interacts with all the other parts of the computer architecture to make sense of the data and
deliver the necessary output.

EXAMPLES OF COMPUTER ARCHITECTURE


1. Von Neumann Architecture
 is a computer architecture that was established in a 1945 presentation by John von Neumann and his
collaborators in the First Draft of a Report on the EDVAC (electronic discrete variable automatic
computer).
2. Harvard Architecture
 the Harvard architecture refers to a computer architecture with distinct data and instruction storage and
signal pathways. In contrast to the von Neumann architecture, in which program instructions and data use
the very same memory and pathways, this design separates the two.

EVOLUTION OF COMPUTER APPLICATIONS


 An application program (software application, or application, or app for short) is a computer program
designed to carry out a specific task other than one relating to the operation of the computer itself.
 typically to be used by end-users.
 Word processors, media players, and accounting software are examples.
 The collective noun "application software" refers to all applications collectively.
 The other principal classifications of software are system software, relating to the operation of the
computer, and utility software ("utilities").

APPLICATION SOFTWARE TIMELINE

Internet Dial Up Access


 In 1979, Tom Truscott and Jim Ellis, graduates of Duke University, created an early predecessor to dial-up
Internet access called the Usenet. The Usenet was a UNIX based system that used a dial-up connection
to transfer data through telephone modems.

World Wide Web


 The World Wide Web (WWW) is a system of interconnected public webpages accessible through the
Internet.
 an information system on the internet which allows documents to be connected to other documents by
hypertext links, enabling the user to search for information by moving from one document to another.

The Key Differences Between The Internet And The Web


Internet World Wide Web
 a global network of networks  a collection of information
 infrastructure accessed via the Internet
 is served on top of that
infrastructure

YAHOO!
 1994, Yang and David Filo co-created an Internet website called "Jerry and David's Guide to the World
Wide Web," which consisted of a directory of other websites.
 As it grew in popularity, they renamed it "Yahoo! Inc." Yahoo! received around 100,000 unique visitors by
the fall of 1994.
 The word "YAHOO" is a backronym for "Yet Another Hierarchically Organized Oracle” or "Yet Another
Hierarchical Officious Oracle”.
 The yahoo.com domain was created on January 18, 1995.

Internet Explorer
 The first Internet Explorer was derived from Spyglass Mosaic.
 was started in the summer of 1994 by Thomas Reardon who, according to former project lead Ben Slivka.
 used source code from Spyglass, Inc. Mosaic, which was an early commercial web browser with formal
ties to the pioneering National Center for Supercomputing Applications (NCSA) Mosaic browser.

Blogger
 Blogger is an American online content management system founded in 1999 which enables its users to
write blogs with time-stamped entries.
 Founded by Evan Williams and Meg Hourihan.
 Pyra Labs developed it before being acquired by Google in 2003.
 Recommend affiliate products, engage in email marketing, self-promotion, sell products.
 underwent a major redesign on May 9, 2004, which included web standards-compliant templates,
individual archive pages for posts, comments, and email posting.
 Blogger's new version, codenamed "Invader," was released in beta alongside the gold update on August
14, 2006.

Facebook
 Facebook is a social media and social networking service owned by American technology conglomerate
Meta.
 Created in 2004 by Mark Zuckerberg with four other Harvard College students and roommates Eduardo
Saverin, Andrew McCollum, Dustin Moskovitz, and Chris Hughes, its name derives from the face book
directories often given to American university students.
 Originally called “THEFACEBOOK”.
 The company dropped 'The' from its name after purchasing the domain name facebook.com in 2005 for
$200,000.
 Zuckerberg built a website called "Facemash" in 2003 while attending Harvard University. The site was
comparable to Hot or Not and used "photos compiled from the online face books of nine Houses, placing
two next to each other at a time and asking users to choose the 'hotter' person".

YouTube
 YouTube is an American online video-sharing platform headquartered in San Bruno, California, founded
by three former PayPal employees—Chad Hurley, Steve Chen, and Jawed Karim—in February 2005.
 The domain name "YouTube.com" was activated on February 14, 2005, with video upload options being
integrated on April 23, 2005, with the slogan "Tune In, Hook Up" ─ the original idea of Chad Hurley, Steve
Chen, and Jawed Karim.
 The concept was an online dating service that ultimately failed but had an exceptional video and
uploading platform. Ultimately, creating an easy-to-use video streaming platform that wouldn't stress out
the new internet users of the early 2000s.
 The first YouTube video, titled Me at the zoo, was uploaded on April 23, 2005, and shows co-founder
Jawed Karim at the San Diego Zoo and currently has over 120 million views and almost 5 million likes.

eBay
 an American multinational e-commerce company based in San Jose, California, that allows users to buy
or view items via retail sales through online marketplaces and websites in 190 markets worldwide.
 Sales occur either via online auctions or "buy it now" instant sales, and the company charges
commissions to sellers upon sales. eBay was founded by Pierre Omidyar in September 1995.
 eBay was founded as AuctionWeb in California on September 4, 1995, by French-born Iranian American
computer programmer Pierre Omidyar as a hobby to make some extra money.
 One of the first items sold on AuctionWeb was a broken laser pointer for $14.83.

Twitter
 X, commonly referred to by its former name Twitter, is a social networking service.
 It is one of the world's largest social media websites and one of the most visited websites in the world.
 Users can share short text messages, images, and videos in posts (formerly "tweets") and like or
repost/retweet other users' content.
 Twitter was created in March 2006 by Jack Dorsey, Noah Glass, Biz Stone, and Evan Williams, and was
launched in July of that year.
 "Twitter was acquired by X Corp both to ensure freedom of speech and as an accelerant for X, the
everything app," the company's owner, billionaire Elon Musk, recently said.
 Twitter became X after being purchased by Elon Musk for $44 billion in late 2022.

MANAGEMENT INFORMATION SYSTEM


 A management information system (MIS) is a computer system of hardware and software that acts as the
foundation for an organization's operations.
 It is used for decision-making, and for the coordination, control, analysis, and visualization of information
in an organization.
 The study of the management information systems involves people, processes and technology in an
organizational context.
 MIS is a planned system of collecting, storing, and disseminating data in the form of information needed to
carry out the functions of management

The system utilizes:


 Computer hardware & software
 Manual procedures
 Models for analysis, planning, control, and decision making, and
 A database

Management - Management is the art of getting things done through and with the people in formally
organized groups.
Information - Information is data that is processed and is presented in a form which assists decision-making.
It may contain an element of surprise, reduce uncertainty or provoke a manager to initiate an action.
System - A system is an orderly grouping of interdependent components linked together according to a plan
to achieve a specific goal. The term system is the most loosely held term in management literature because of
its use in different contexts.

5 Components of MIS
1. People Resources: People are required for the operation of all information system.
2. Data Resources: Database holds processed and organized data.
3. Software Resources: It includes all sets of information processing instruction.
4. Hardware Resources: Include all physical devices and materials used in information processing.
5. Process: is a step undertaken to achieve a goal.

Five Major Objectives of MIS


1. Data Capturing
MIS capture data from various internal and external sources of the organization. Data capturing may be
manual or through computer terminals.

2. Processing of Data
The captured data is processed to convert into the required information. Processing of data is done by such
activities as calculating, sorting, classifying, and summarizing.

3. Storage of Information
MIS stores the processed or unprocessed data for future use. If any information is not immediately required, it
is saved as an organization record, for later use.

4. Retrieval of Information
MIS retrieves information from its stores as and when required by various users.

5. Dissemination of Information
Information, which is a finished product of MIS, is disseminated to the users in the organization. It is periodic
or online through a computer terminal.

Characteristics Of MIS
 System Approach
 Management Oriented
 Need-Based
 Exception Based
 Future Oriented
 Integrated
 Long Term Planning
 Sub-System Concept
 Central Database

Broad Functions of MIS


 To Improve Decision-Making - managers can make prompt and informed decisions, which ultimately
enhances the quality of decision-making and contributes to the company’s value.

 To Improve Efficiency - The Management Information System (MIS) facilitates managers in executing
their duties with enhanced ease and efficiency, resulting in improved productivity.

 To Provide Connectivity - The MIS provides managers with better connectivity with the rest of the
organization.

 Data Processing - Data processing involves collecting, transmitting, storing, and processing data to
generate an output.

 Prediction - By utilizing methods of modern mathematics, statistics, or simulation, data analysis is


conducted to predict potential future scenarios.

 Planning - The analysis of data of a regular nature may give many indications on likely future events or
situations and this can be utilized in planning or reviewing the plan already made earlier.

 Control - By examining records of daily, monthly, quarterly, or annual activities, certain factors that
require management and control can be identified.

 Assistance - One of the principal functions of MIS is to support senior management by analyzing regular
records and drawing inferences about various factors related to the company’s operational performance,
such as human resources, financial resources, material resources, and more.

Advantages of MIS
1. Generate Competitive Advantages - MIS if implemented properly, provides a wealth of information to
allow management to construct and develop effective plans to meet, and beat, their competition.

2. Fast Reaction to Market Changes - MIS can deliver facts, data and trends to business with lighting
speed. Having this information allows business houses to react quickly to market changes, regardless
of the type (positive or negative) or volatility.

3. MIS as Strategic Resource:


 It helps to be a head in the competition.
 It helps company in analyzing their own SWOT.
 It also helps in maintaining its own profitability.
 It protects company from business cycles.
 It provides future direction to the organizations.
 It also provides the competitive edge.

4. Functional Use - It helps in simplifying the business processes. It helps organization in meeting the
standards and benchmarks.

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