1. Week 1

2. What we will cover in this course General place of AIS in accounting Conceptual place of AIS Values and assumptions Documentation techniques Accounting controls Concepts—COSO/COBIT and ERM based SOX, in general and as related to controls Database Concepts of data modeling What do accountants need to know Business cycles and accounting systems Special topics in accounting systems Intangibles, formatting, impacts and implications

3. Announcements Send me an email. Put ACTG335 in the subject line. Send it from all the email addresses you may rely on for class info Send it by Friday, September 28 th You will be held responsible for materials I send out by email Many readings will be put on my website.

4. How does an AIS fit in an organization?

5. AIS objectives Collect and store data Support efficiency and effectiveness Provide adequate controls Provide information for decision making

6. Factors influencing AIS design Strategy Information technology Organizational culture Societal demands …what do we need to account FOR

7. Measurement issues What to measure Measurement attributes What to report Abstractions What basis for measuring? For whom? To meet what objective(s)? Accountants are professionals, with a responsibility to serve the public interest. Accounting Abstraction Model—what does accounting DO?

8. AIS as a filter

9. Valuation theory v. Events theory—intro to DB in AIS

10. Characteristics of information Useful Relevant Reliable Complete Usable Understandable Verifiable Credible Timely Accessible

11. Useful—Relevant Connected to business objectives Logical, supportable thread from metrics to objectives Meaningful for the purpose intended, valid Predictive value (leading) Training, investment in IT, advertising Feedback value (lagging) ROI, net income, productivity

12. Lagging Indicators Measures of output, end-process measures, record effects Reflect past performance Generally quantitative Example: Quantity of toxic emission; last year’s percentage of on-time deliveries Strength: Easy to quantify and understand, preferred by regulators and public— deterministic rather than probabilistic Weakness: Time lag in feedback, ignore present activities

13. Leading Indicators In-process metrics of performance, proactive Reflect current status/activities—for future performance Quantitative or qualitative Example: percent of facilities conducting self- audit; training of logistics managers Strength: Represent current actions and future trends Weakness: Harder to build support for use, harder to track to performance—probabilistic rather than deterministic

14. Useful—Reliable Accurate for the purpose intended Representational faithfulness Verifiable Neutral meaning objective, but not purposeless relieves us of the need to assess “values” of the data/information Acknowledge inherent bias in any metric/measure

15. Usable Credible What users value and trust Assess and report on the accuracy of key sources Institute a data-quality program for key data Timeliness Accessibility Physically Cognitively

16. Information attributes  Information context Information attributes relate to the specific characteristics of individual units of information (data, really) Information context relates to understanding how information, as defined, relates to the world in which we live and work. Definition of context, from Merriam-Webster online dictionary: 1 : the parts of a discourse that surround a word or passage and can throw light on its meaning 2 : the interrelated conditions in which something exists or occurs

17. Abstractions

18. Abstraction model—how do we (society/stakeholders) know what happens in an organization?

19. Values and assumptions Public interest Stakeholders—what does this mean? Center for Professional Integrity and Accountability—See Values and Assumptions from the syllabus What to measure, how to report— influences the interests that are privileged

20. Chapter 2—AIS processes Transaction processing system Database

21. Business cycles Real business activities for the AIS to capture, process, report Revenue Expenditure HR Production Financing

22. Basic Business Processes A set of Give-Get exchanges

23. Collect data Transactions: agreement between two parties to exchange economically measurable goods Capture the data Implement control procedures Record in journals General for rare or EOP Specialized for standardized Post to ledgers Prepare reports

24. Computer processing Master/transaction files Batch/real-time/on-line Queries/reports I am going to spend little time on this, but expect you to use the terms and concepts pretty readily…ask questions if you need to.

25. Waren Distributing Get started. Quiz on October 15 th.