Question

Explain at list how AIS affects firm value?

Answer 1

Answer:

Accounting information system is defined as a system of collection, storage and processing of fnancial and accounting data that is used by descision makers. An AIS is generally a computer based method for tracking accounting activity in conjuction with information technology resources. The resulting stastical reports can be used internally by management or externally by other interesed parties including investors, creditors and tax authorities. Accounting information takes into consideration different aspects, which are composed of smaller subsystem, which help an organisation in acheving goals. The different sub components in AIS include Budgeting and planning, Expense Management, Revenue Management, Cash and treasury Management, Accounting Software, Electronic Banking, Activity bassed management, Payroll etc.

The key elements that compose the typical Accounitng System are as follows:

• People
• Procedure and Instruction
• Data
• Software
• Information Technology Infrastructure
• Internal Controls