ExpertFinancial Systems and Technology
Learning outcomes
- Trace transaction processing data routes.
- Identify ledger processing flaws and automated control logic.
Transaction Processing Systems (TPS)
A TPS handles the daily routine transactions of a business (sales, purchases, payroll). The cycle is:
- Input: Capturing the data (e.g., scanning a barcode).
- Processing: Updating the ledgers.
- Output: Generating a receipt or report.
Processing Methods
- Batch Processing: Transactions are grouped together and processed all at once (e.g., running monthly payroll overnight).
- Real-time Processing: Transactions are processed immediately (e.g., booking an airline ticket).
Which of the following is the best example of real-time processing?
Automated does not mean Error-Free
Students assume automated systems don't make mistakes. If the input data is wrong (e.g., typing £100 instead of £10), the system will perfectly process the wrong number. 'Garbage In, Garbage Out' (GIGO).
Automated Controls
To prevent GIGO, systems use automated input controls:
- Range checks: Rejects a date of birth in the year 2050.
- Format checks: Ensures a phone number only contains digits.
- Check digits: A mathematical formula applied to a barcode to ensure it was scanned correctly.
An accounting system rejects an invoice because the date entered is '32/01/2024'. What type of automated control is this?
Exam Focus
Be able to identify the correct control for a specific error. If a user types 'O' instead of '0', a format check (expecting numbers only) will catch it.
What does the acronym 'GIGO' stand for in relation to information systems?
A payroll clerk calculates the total sum of all employee ID numbers before entering them into the system. The system also calculates this sum and compares the two. What is this control called?
Which of the following systems is designed to help senior executives make unstructured, strategic decisions?
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