College of Administration and Finance Sciences
Assignment (1)
Deadline: Saturday 16/10/2021 @ 23:59
Course Name: Introduction to AIS
Student’s Name: TURKI MATEEB ALMOTIRI
Course Code: ACCT402
Student’s ID Number:S180148638
Semester: 1st
CRN:12035
Academic Year: 1443 H
For Instructor’s Use only
Instructor’s Name:
Students’ Grade: /5
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answers must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism.
Submissions without this cover page will NOT be accepted.
Assignment Question(s): (Marks 5)
IMPORTANT NOTE: Answer in your own words, DO NOT COPY from slides, fellow student, or internet source without proper citation.
Assignment Question(s):
Q1. How do an organization’s business processes and lines of business affect the design of its AIS? Give 4 examples of how differences among organizations are reflected in their AIS.
(1 Mark)
AIS is a critical tool that assists the organization to effectively record and manage its financial transactions. With the increased cases of fraud in today’s business environment, adopting the AIS has been a key milestone that any business entity can have. However, the design of the AIS is always affected by business processes and transactions within the company. One reason why the design of the AIS is affected is that a different IAS governs most processes within the business organization (Khalid & Kot, 2021). For instance, service companies such as law firms and real estate agents do not produce and sell physical goods, and they do not need to purchase or install inventory control systems. Instead, they depend on the AIS to keep data records for services offered to any customers to ensure that they have traceable records. Besides, an organization whose business processes involve the production and sale of agricultural products and deals explicitly in the line of Agricultural produce will specifically use IAS 41, which deals with recognition and measurement of Agricultural produce. The differences among organizations are also evident. More so, an organization that is involved in Investment property will employ IAS 40, an organization that deals with intangible assets such as royalties will use IAS 38, while an organization whose process involves inventory will recognize the inventory using IAS 2 (Kareem et al., 2021).
Q2. Discuss at least one advantage and one disadvantage of stating well-defined corporate strategies in the annual report
(1 Mark)
AIS is a critical tool that assists the organization to effectively record and manage its financial transactions. With the increased cases of fraud in today’s business environment, adopting the AIS has been a key milestone that any business entity can have. However, the design of the AIS is always affected by business processes and transactions within the company. One reason why the design of the AIS is affected is that a different IAS governs most processes within the business organization (Khalid & Kot, 2021). For instance, service companies such as law firms and real estate agents do not produce and sell physical goods, and they do not need to purchase or install inventory control systems. Instead, they depend on the AIS to keep data records for services offered to any customers to ensure that they have traceable records. Besides, an organization whose business processes involve the production and sale of agricultural products and deals explicitly in the line of Agricultural produce will specifically use IAS 41, which deals with recognition and measurement of Agricultural produce. The differences among organizations are also evident. More so, an organization that is involved in Investment property will employ IAS 40, an organization that deals with intangible assets such as royalties will use IAS 38, while an organization whose process involves inventory will recognize the inventory using IAS 2 (Kareem et al., 2021).
Q3. Some individuals argue that accountants should focus on producing financial statements and leave the design and production of managerial reports to information systems specialists. What are the advantages and disadvantages of following this advice? To what extent should accountants be involved in producing reports that include more than just financial measures of performance? Why?
(1 Mark)
From the case, the advice that accountants should only focus on producing financial statements and leave the production or design of managerial reports is beneficial because it would result in better and accurate financial statements as it will significantly minimize the chances of errors in the ultimate financial statements. Leaving out production will obviously give an accounting officer a lot to focus on the production financial statements. The disadvantage with this case is that system specialists will have limited managerial knowledge on critical financial issues. As a result, they may not produce inaccurate reports (Moreno & Jones, 2021). Secondly, it denies accountants the chance to compare the performance of management to the organization’s overall financial performance, thus denying a correct explanation of the differences in performance. Moreover, the accountants should be more involved in producing the nonfinancial measures of performance since it gives them a chance to identify the factors that generally contribute to the organization’s performance together with the financial performance measures.
Q4. Do you agree that the most effective way to obtain adequate system security is to rely on the integrity of company employees? Why or why not? Does this seem ironic? What should a company do to ensure the integrity of its employees?
(1 Mark)
In my opinion, I with this analogy because human beings are prone to errors, and in most cases, very few employees would report their own careless mistakes on the data systems. Without a doubt, integrity is one of the major ethical requirements for an accounting officer. However, this trajectory is inevitable. It is impossible to achieve 100% ethical integrity on employees as most of them would be driven by greed and self-interest to compromise with the system’s security by providing loopholes for unauthorized access to the system (Mohammed, 2021). Therefore, it is true that this seems ironic since the employees should be at the forefront of ensuring the system is safe. For this case, the organization should develop an excellent organizational culture that inculcates good ethical behavior among employees. Besides, the organization should embrace using the AIS system for better and accurate data recording and storage. Lastly, the company should educate the employees on practicing professional, ethical behavior such as integrity.
Q5. What motives do people have for hacking? Why has hacking become so popular in recent years? Do you regard it as a crime? Explain your position.
(1 Mark)
The motives people have are to obtain some financial and nonfinancial favors from hacking other people’s systems. Another motive is to access another party’s information for competitive purposes. Hacking has become very popular in recent years due to the increased rate of unemployment that gives employment youths a chance to hack into other people’s systems for financial gains. The increased competition has also increased hacking in recent years as firms want to access confidential information of other firms to gain a competitive advantage. Advancement in the level of technology also promotes hacking. Yes, I do regard hacking as a crime. This is because hacking exposes confidential information unwillingly to other parties; hence should be punishable by law.
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