Chapter 2 Overview of Transaction Processing and ERP Systems Copyright © 2012 Pearson Education,...

Chapter 2Overview of Transaction Processing and ERP Systems

Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall2-1

Learning Objectives

Describe the four major steps in the data processing cycle. Describe the major activities in each cycle.

Describe documents and procedures used to collected and process data.

Describe the ways information is stored in computer-based information systems.

Discuss the types of information that an AIS can provide.

Discuss how organizations use ERP systems to process transactions and provide information.

Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall 2-2

Data Processing Cycle


The Data Processing Cycle Determines

What data is stored?

Who has access to the data?

How is the data organized?

How can unanticipated information needs be met?


Data Input—Capture

As a business activity occurs data is collected about:1. Each activity of interest

2. The resources affected

3. The people who are participating


Paper-Based Source Documents

Data are collected on source documents E.g., a sales-order form The data from paper-

based will eventually need to be transferred to the AIS

Turnaround Usually paper-based Are sent from

organization to customer Same document is

returned by customer to organization


Turnaround Document

Source Data Automaton

Source data is captured In machine-readable form At the time of the business activity

E.g., ATM’s; POS


Data Input—Accuracy and Control

Well-designed source documents can ensure that data captured is Accurate

Provide instructions and prompts Check boxes Drop-down boxes

Complete Internal control support Prenumbered documents


Data Storage

Types of AIS storage: Paper-based

Ledgers Journals

Computer-based


Ledgers

General Summary level data for

each: Asset, liability, equity,

revenue, and expense

Subsidiary Detailed data for a General

Ledger (Control) Account that has individual sub-accounts Accounts Receivable Accounts Payable


Journals

General Infrequent or specialized transactions

Specialized Repetitive transactions

E.g., sales transactions


Coding Techniques

Sequence Items numbered consecutively

Block Specific range of numbers are

associated with a category 10000–199999 = Electric Range

Group Positioning of digits in code provide

meaning

Mnemonic Letters and numbers Easy to memorize Code derived from description of item

Chart of accounts Type of block coding


Digit Position Meaning

1–2 Product Line, size, and so on

3 Color

4–5 Year of Manufacture

6–7 Optional Features

1241000 12 = Dishwasher4 = White10 = 201000 = No Options

Computer Based Storage

Entity Person, place, or thing (Noun) Something an organization wishes to store data about Attributes

Facts about the entity Fields

Where attributes are stored Records

Group of related attributes about an entity File

Group of related Records


File Types

Transaction Contains records of a

business from a specific period of time

Master Permanent records Updated by transaction

with the transaction file

Database Set of interrelated files


Data Processing

Four Main Activities1. Create new records

2. Read existing records

3. Update existing records

4. Delete records or data from records


Data Output Types

Soft copy Displayed on a screen

Hard copy Printed on paper


ERP Systems


Enterprise Resource Planning (ERP)

Integrate an organization’s information into one overall AIS

ERP modules: Financial Human resources and payroll Order to cash Purchase to pay Manufacturing Project management Customer relationship management System tools


ERP Advantages

Integration of an organization’s data and financial information

Data is captured once

Greater management visibility, increased monitoring

Better access controls

Standardizes business operating procedures

Improved customer service

More efficient manufacturing


ERP Disadvantages

Cost

Time-consuming to implement

Changes to an organization’s existing business processes can be disruptive

Complex

Resistance to change


Chapter 2 Overview of Transaction Processing and ERP Systems Copyright © 2012 Pearson Education,...

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