ATI ACCOUNTING FINAL EXAM STUDY GUIDE

ATI ACCOUNTING FINAL EXAM STUDY GUIDE Accounting Information Systems - CORRECT ANSWER -A system that records, processes, summarizes, reports and communicates the results of business transactions to provide financial and nonfinancial information to facilitate decision making. It is designed to ensure appropriate levels of internal controls for those transactions. What makes information useful? - CORRECT ANSWER -In order for information to be useful, it must be relevant and be a faithful representation. Relevance: information must be relevant to the decision maker, capable of influencing the decisions of users Faithful representation: information is complete, neutral, and is free from error. Represents the substance of the underlying economic transaction. What are the mandatory reporting requirements for public corporations? - CORRECT ANSWER -Tax returns and audited financial statements. What is the value chain? - CORRECT ANSWER -A chain of business processes for a firm. Primary activities: 1. Inbound logistics: receiving and storing raw materials + distributing materials to where they are needed 2. Operations: activities that transform inputs into finished goods and services 3. Outbound logistics: activities that warehouse and distribute finished goods to customers 4. Marketing and sales activities: identify needs and wants of customers to help attract them to firm's products 5. Service activities: provide support of customers after products and services are sold to them Support activities: 1. Firm infrastructure: activities needed to support the firm (CEO, finance, legal, and accounting depts.) 2. HRM activities 3. Technology activities to support value creating activities 4. Procurement activities: purchasing inputs (raw materials, supplies, equipment) What skills are required for CISA (Certified Information Systems Auditor)? - CORRECT ANSWER -- Pass CISA exam - have 5+ years in IS/IT audit, control, assurance, or security job - adhere to professional code of ethics What skills are required for a CIA (Certified Internal Auditor)? - CORRECT ANSWER -- Bachelor's degree or higher - 5+ years of internal audit experience or - active student in final year of college or - active student with approved Internal Audit Education Partnership school What skills are required for a CITP (Certified Information Technology Professional)? - CORRECT ANSWER -- member of AICPA in good standing - valid CPA license - minimum 1,000 hours of business experience within 5-year period preceding date of CITP application - pass the CITP exam What is the supply chain? - CORRECT ANSWER -Supple chain refers to the flow of materials, information, payments, and services from raw materials suppliers, through factories and warehouses, all the way to the final customers. A supple chain will also include the firms and processes that create and deliver products, information, and services to the final customers. The supple chain refers to a network of processes that delivers a finished good or service to the final customer. What is a CRM? - CORRECT ANSWER -a customer relationship management software is a software that is used to manage and nurture a firm's interactions with its current and potential clients. It often includes the use of database marketing tools to learn more about customers and to develop strong firm-tocustomer relationships. Investments in an AIS are _______________ expenses - CORRECT ANSWER -selling, general, and administrative Investments in a supply chain system are _____________ expenses - CORRECT ANSWER - What is the IT strategic role of organizations? - CORRECT ANSWER - Define the automate, informate, and transform IT strategic roles of systems. - CORRECT ANSWER - Automate: Replace human labor in automating business processes Informate-Up: Provide information about business activities to senior management Informate-Down: Provide information about business activities to employees across the firm Transform: fundamentally redefine business processes and relationships What is the information value chain? - CORRECT ANSWER -The overall transformation from a business need and business event to the collection of data and information to an ultimate decision. The transformation from data to information is a key part of the value chain. What are the various roles of accountants in AIS? - CORRECT ANSWER -1. user: inputting journal entries, using a financial spreadsheet, using anti-virus software to protect the system