Accounting Information Systems by J. Hall PDF

By J. Hall

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Middle management is accountable for the short-term planning and coordination of activities necessary to accomplish organizational objectives. Top management is responsible for longer-term planning and setting organizational objectives. Every individual in the organization, from business operations to top management, needs information to accomplish his or her tasks. Notice in Figure 1-1 how information flows in two directions within the organization: horizontally and vertically. The horizontal flow supports operations-level tasks with highly detailed information about the many business transactions affecting the firm.

The elements of the general model are end users, data sources, data collection, data processing, database management, information generation, and feedback. End Users End users fall into two general groups: external and internal. External users include creditors, stockholders, potential investors, regulatory agencies, tax authorities, suppliers, and customers. Institutional users such as banks, the SEC, and the Internal Revenue Service (IRS) receive information in the form of financial statements, tax returns, and other reports that the firm has a legal obligation to produce.

Irrelevancies detract attention from the true message of the report and may result in incorrect decisions or actions. 13 14 PART I Overview of Accounting Information Systems TIMELINESS. The age of information is a critical factor in determining its usefulness. Information must be no older than the time of the action it supports. For example, if a manager makes decisions daily to purchase inventory from a supplier based on an inventory status report, then the information in the report should be no more than a day old.

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