Question

1. Define the basic terms in the foundations of AIS such as:
   1. A system.
   2. An accounting information system.
   3. Goal conflict and goal congruence.
   4. Data and information.
   5. Information overload and the value of information.
   6. Transactions.
   7. Transaction processing system.

Answer 1

a. System:

A set of two or more interrelated components that interact to achieve a goal.

b. An accounting information system:

An (AIS) is a system of collecting, storing and processing financial and accounting data that are used by decision makers. An accounting information system is generally a computer-based method for tracking accounting activity in conjunction with information technology resources. The resulting financial reports can be used internally by management or externally by other interested parties including investors, creditors and tax authorities. Accounting information systems are designed to support all accounting functions and activities including auditing, financial accounting & reporting, managerial/ management accounting and tax.

c. Goal conflict and Goal congruence:

Occurs when a decision or action of a subsystem is not consistent with another subsystem or the larger system.

Occurs when the subsystem's goals are in line with the organization's goals.

d. Data and information.

Facts that are collected, recorded, stored, and processed by an information system.

The time and resources spent collecting data, processing data, storing data, and distributing information to users.

e.Information overload and the value of information.

Information overloaded is the difficulty in understanding an issue and effectively making decisions when one has too much information about that issue.[5] Generally, the term is associated with the excessive quantity of daily information. Information overload most likely originated from information theory, which are studies in the storage, preservation, communication, compression, and extraction of information.

The value of information is a very slippery concept as information per se does not have any universal value. Its value is related to the person who uses it, when he uses it and for what he uses it.

f.Transactions.

A transaction is an agreement between a buyer and a seller to exchange goods, services or financial instruments.

g. Transaction processing system.

A Transaction Processing System is a set of information which processes the data transaction in database system that monitors transaction programs. The system is useful when something is sold over the internet. It allows for a time delay between when an item is being sold to when it is actually sold.