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ACCA Performance Management > Chapter 2: Management Information Systems > Flashcards

Chapter 2: Management Information Systems Flashcards

1
Q

Definition of data

A

Raw & unprocessed format
Recorded but not yet processed in a way suitable to make decisions
Sits with IT concerned with storage & security

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2
Q

Definition of information

A

Processed data in a way which has meaning to the person who receives it.
This person can use it to improve the quality of their decisions

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3
Q

What does management require information?

A

1) provide current & historical records
2) Analyse what is happening to the business
3) Basis on decision making in ST &LT
4) Monitor the performance to compare actuals and forecasts

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4
Q

What 3rd parties would be interested in info about the business

A

Owners/ shareholders
Customers & suppliers
Employee
Gov agencies e.g tax

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5
Q

What are the characteristics of good information?

A

ACCURATE
Accurate
Complete
Cost-effective
Understandable
Relevant
Accessible or authoritative
Timely
Easy to use

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6
Q

What is meant by complete info

A

Managers should have all info needed but not an excessive amount

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7
Q

What is meant by cost- effective info

A

Value of info should exceed cost of producing it

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8
Q

What is meant by understandable info

A

Info is clearly presented & displayed

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9
Q

What is meant by timely info

A

Info should be provided in sufficient time for decisions to be made

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10
Q

What is data processing

A

Converting data to info e.g classifying/ sorting/ producing
Can be automated or manual

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11
Q

How can data transformed

A

summarising data/ basic processing/ statistical and financial analysis/ tubulation

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12
Q

What is information technology (IT)?

A

Hardware needed for capture, storage, transmission or presentation of info

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13
Q

What are Information Systems (IS)?

A

Management of systems to support running the business
Needs ready access to necessary data –> discard what’s not needed
Bespoke to company so expensive
Needs to add value where it’s cost-effective

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14
Q

What do Information systems do?

A

Links organisations to customers & suppliers
effective integration to use info for value-adding process
Orgs can develop/ produce/ market & deliver new products or services based on info
Senior management help to develop and implement strategy
E.g tesco club card

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15
Q

What are the 2 main roles of Information systems

A

1) Support operations via processing & storing transactions
2) Support managerial activities e.g decision making, planning, performance measurement & control

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16
Q

What do organisations use information for?

A

1) Record transactions
2) Make decisions
3) Planning
4) performance measurement
5) control

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17
Q

Why do you need to record transactions

A

1) evidence in disputes
2) legal requirement
3) Build a profile to assess profitability

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18
Q

Why is information used for planning

A

Availability of resources
Possible timescales etc

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19
Q

What is performance measurement

A

Enables comparisons of actuals vs budget/ plan
collection of info on costs & profitability
analysis & presentation performed by IS

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20
Q

What is control

A

Show whether a plan is proceeding as expected / unexpected deviations
IS can monitor project outcomes

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21
Q

How to assess costs of an IS

A

Cost- Benefit Analysis (CBA)
shows expected losses vs benefits
refined systems= expensive
Skilled staff need for operation= expensive

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22
Q

What are the initial costs of an IS

A

1) design & develop if bespoke
2) purchasing software if not bespoke
3) purchasing new hardware
4) Cost of testing & implementing
5) training cost

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23
Q

What are the running costs of IS?

A

1) labour time to run system
2) material cost e.g replacement parts
3) cost of service support
4) Ongoing training costs

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24
Q

What are costs of internal info?

A

1) direct data capture (barcode scanners)
2) Processing costs ( payroll salaries)
3) Indirect costs (info which isn’t needed/ duplicated)

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25
What are costs of external info?
1)Direct costs (subscriptions) 2) Indirect costs (wastage time finding useful info) 3) Management costs (processing info) 4) Infrastructure costs (systems enabling internet searches)
26
What are the benefits of a new IS?
Enhanced efficiency & capacity better quality information Better access to info Improved sharing of info Improved communication Better decision making and customer service
27
What is a LAN & WAN?
LAN= Local area network can share data and to devices e.g printers & emails WAN= Wide area network Connects LANS so computers in different locations can connect
28
What does a network do
Facilitates the transfer of information between different parts of the business
29
What is the intranet
Internal network used to share info in organisations with employees Firewall fends off unauthorised access
30
Benefits of the intranet
Eliminates storage, printing & distribution of documents More widely used than files in drawers--> improves productivity & efficiency Easier to update information
31
What is cloud computing
Access different services via the internet Data is stored, managed and processed with remote servers for on-demand access
32
What are some benefits of cloud computing
1)Lower maintenance costs (don't need physical space & everything done by a 3rd party). Only pay for what's used and accessed anywher 2) Data easily backed up & updated in real time --> flexible and accurate financial reporting. More efficient than legacy systems 3) Security -service provider pays to fix problems & upgrade so don't need to pay extra for this 4) Agility- work across the globe on same project at same time
33
What is the extranet
Collaborative network Extension to intranet connecting the business to shareholders/ suppliers etc
34
What is the internet
Interconnected networks/ computers carry info & resources connect via an IP (Internet Protocol) address Share data quickly Opens up to viruses & hackers
35
What is wifi?
Wireless Fidelity Mobile use of laptops & handheld devices Used to buy products- firms create apps- makes purchasing quicker Used to access key info e.g in hospital wards
36
What are the 2 types of control?
General controls Application/ program controls
37
What are General controls
Overall control of IS Physical control- preventing physical access to hardware e.g locks/ alarms/ cctv Personnel control- segregating duties/ hierarchy of access/ training/ supervision Access controls - passwords/ time outs Computer equipment controls - prevent from destruction/ damage/ theft Business continuity planning- risk assessing what is critical to the business
38
What is application/ program controls
Automatically performed by the system Completeness- all data is processed Validity- only valid data is input Identification- Users are identified & authorised Problem management facilities- recorded problems timely
39
What are the solutions to the threat of natural disasters?
1) Fire procedures- alarms/ extinguishers/ doors/ training/ insurance 2) Location- not in a place liable to disasters 3) Physical environment- air con/ dust control 4) Back up procedures - regular basis for recovery
40
What are the solutions to the threat of a malfunction?
1) Network design - cope with periods of high volumes 2) Back up procedures
41
What are the solutions to the threat of a Viruses?
1) Anti-virus software (updated regularly to prevent corruption) 2) Formal security policy & procedures 3) Regular audits to check for unauthorised software
42
What is a virus
Small program that once introduced to the system spreads extensively Can affect the whole system
43
What are the solutions to the threat of a hackers?
1) Firewall software- protection from unauthorised access to the system from the internet 2) Passwords/ usernames- Limits unauthorised access to the system 3) Formal security policy & procedures- when using personal devices at work there should be a policy to prevent hackers 4 ) User awareness training of risks should be available 5) Data encryption - scrambled prior to transmission. Recovered in a readable format once transmission is complete
44
What are the solutions to the threat of a Electronic eavesdropping?
1) Data encryption 2) Passwords/ Usernames
45
What is hacking?
Deliberate access to systems by unauthorised persons
46
What are the solutions to the threat of a human errors?
Training & operating procedures
47
Definition of human errors
unintentional errors from using computer & networks
48
What are the solutions to the threat of a human resource risk?
Ergonomic design of workstations- reduces problems such as RSI Anti-glare screens to reduce eye strain Cables in ducts
49
What is human resource risk
Repetitive strain injury (RSI), headaches and eye strain from computer screens, tripping over loose wires
50
What is wikileaks
Not-for-profit org protects whistleblowers & journalists with sensitive info to communicate to public
51
What is an input control & an example?
Inputs should be complete, accurate & authorised Passwords
52
What is a processing control & an example?
Should be initiated by appropriate personnel & logs kept of any processing Audit trails
53
What is an output control & an example?
Should be available to authorised persons & 3rd parties only Distribution lists
54
What are the 7 different controls over input
IFRSCCM 1) Input 2)Format checks 3) Range tests 4) Sequence checks 5) Check digits 6) Control totals 7) Matching
55
What is the input method?
Ensure data is authorised & provides a software audit trail
56
What is the range tests control method?
Ensure data is accurate E.g month fields to be in the range of 1-12
57
What is the format checks control method?
Ensures data is accurate Everything in the correct format to be read and processed correctly
58
What is the check digits control method
ensures accuracy specially constructed numbers to comply with a mathematical test
59
What is the sequence checks control method
ensures completeness everything is accounted for
60
What is the matching control method?
completeness
61
What is the control totals control method
Ensures accuracy, completeness & authorisation as input batches can be authorised manually
62
What are controls over processing
Passwords software audit trails track what processing is carried out Programs shouldn't be altered without authorisation & testing otherwise incorrect/ fraudulent processing can be carried out- incorrect/ fraudulent processing can be carried out
63
What are controls over output
Password systems- each one allocated suitable access rights Sensitive printed output- distribution list & physically safeguarded
64
What are controls over output
Password systems- each one allocated suitable access rights Sensitive printed output- distribution list & physically safeguarded
65
What are logical access controls
Passwords/ usernames identify who has access to the system/ grant access to the system or files Can have several levels of passwords
66
What are firewalls
Combination of hardware & software between the intranet & internet Control procedures established to allow public access to some parts of the the org's computer system (outside firewall) while restricting access to other parts (inside firewall)
67
What is data encryption
Disguising info to preserve its confidentiality scrambles the data to be unintelligible unless it's unscrambled/ decrypted
68
What is virus protection
Control on use of external software (check for viruses before using new software) Antivirus software, regularly updated to detect & deal with viruses Educating employees to be watchful for viruses part of attached files to emails
69
What is data visualisation?
allows large volumes of complex data to be displayed in a visually appealing/ accessible way to facilitate the understanding of underlying data Improves clarity & impact
70
Technology in data visualisation
Customisable, interactive 3D formats to manipulate and drill down in data Find data through intuitive, user-friendly interface
71
What 5 features should a features should data visualisation have
1) Decision - making ability (results focused) 2) Effective infrastructure (Output is reliant on sufficient quality & quantity of data) 3) Integration capability (with existing systems & business overall) 4) Prompt discovery of rules & insights (live data vital) 5) real- time collaboration
72
What are the key benefits of IT data visualisation tools
1) Accessible 2) Real-time 3) Performance optimisation 4) Insight and understanding
73
What is the benefit of accessibility
User-friendly and intuitive
74
What is the benefit of working in real-time for IT data visualisation
Clear and informative quicker responses
75
What are the benefits of performance optimisation for IT data visualisation
immediacy & clarity of info being displayed Better decision making Proactive Efficient utilisation of resources as problems identified promptly
76
What are the benefits of insights & understanding for IT data visualisation
Combines data & visualising Improved understanding Fresh insights about cause & effect of data
77
What is report visualisation used for?
Allows managers to access relevant, timely & accurate info. Presented in an easily digestible way for effective decision-making
78
What is report visualisation?
presents large volumes of data in an understandable format
79
What are key requirements of report visualisation?
1) info personalised to user for optimal understanding 2) Info interactive to focus on relevant areas 3) delivery channel optimised
80
What are key features of report visualisation?
1) Dashboards 2) Tools
81
What are dashboards
summarised overview of info starting point Receive real-time info on current performance Helps hit pre-determined targets - instant feedback & fixes Drill down to data where necessary
82
What are tools
Waterfall charts/ bridges - shows variances / detail about movements Line charts- identify trends/ establish baseline for future performance Mapping charts- geographical divisions Pie charts- comparing data sets of component parts

ACCA Performance Management (15 decks)

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