0:04 hello welcome to our video lecture for
0:07 chapter 2 overview of transaction
0:10 processing and ERP systems enterprise
0:17 resource planning systems the
0:19 transaction storage is all about data
0:21 processing right you have an input
0:24 possibly a source document great but
0:26 transactions such as paying an invoice
0:29 then you have to process that
0:31 information that you got your input then
0:34 you have to store it and create some
0:36 information output which is usually
0:38 financial statements or supporting
0:42 evidence for the journal entry input is
0:44 pretty much you capture the transaction
0:48 that basically trigger the business
0:50 event so you're either capturing the
0:52 sale of property plant and equipment or
0:54 the acquisition you popu what might be
1:00 copy you might be capturing the purchase
1:02 of inventory etc once you get the data
1:04 you obviously have to ensure that it's
1:06 accurate and complete one of our
1:08 audience standards is completeness and
1:11 that built into your data input then
1:12 more important thing you want to make
1:14 sure that the company's policies are
1:17 followed for and that's your internal
1:18 control so you want to make sure those
1:20 are in place and that they're actually
1:24 being followed and performed you capture
1:28 the data in it's basically some activity
1:31 of interest a stale a purchase of
1:34 inventory or other payables then you
1:35 want to make sure what's affected it
1:37 could be cash it could be inventory
1:39 could be accounts receivable then who
1:42 initiated that activity was it a
1:45 customer calling to purchase items was
1:47 it you as the entity calling a vendor to
1:49 get replenishment of stock or your
1:52 employee when it comes to payroll and HR
1:55 all the information that you are
1:57 capturing comes from source documents
2:02 and third-party documents are the most
2:04 reliable so a virus the
2:06 a bank statement that is far more
2:08 reliable than a report I created myself
2:15 such as a Pio source documents is data
2:17 when the actual transaction takes place
2:20 so similar to revenue recognition once a
2:22 transaction takes place you're allowed
2:24 to record it when it's earned and
2:26 documents can come in several formats
2:30 paper turnaround maybe you're getting
2:32 you're getting these documents from a
2:34 cash register or a point-of-sale a
2:36 scanner that will like in Walmart that
2:40 tells you yes we've sold us storage is
2:42 basically how everything is organized
2:45 and that's key you have a chart of
2:48 accounts which lists all the account
2:49 numbers and the description of the
2:51 account and that is what gives you the
2:54 capability of recording a transaction to
2:56 one of those accounts that the key to
2:59 establishing a chart of account is make
3:01 sure it works with you and built with
3:04 you in your organization so you might
3:07 have a just a simple account number for
3:10 the first segment of that general ledger
3:12 account then you may have another
3:15 segment which includes possibly the
3:17 regional area or the division and then
3:21 the final segment might be for the
3:24 department the data storage can also
3:27 take place in the format of transaction
3:28 journal so every time you have a say a
3:31 lot you say that's a transaction or for
3:32 cash receipts every time there's a
3:35 payment on account receivables you would
3:38 have a accounts receivable journal then
3:40 you would also have the I'm sorry the
3:42 cash dispersements journal you also have
3:44 subsidiary ledgers such as accounts
3:46 receivable or accounts payable or
3:57 and those transactions once you've
3:58 looked at the chart of accounts you've
4:01 analyzed the transaction posted it to
4:03 the proper sub ledger it should be
4:06 posted to the sub ledger and the general
4:09 ledger at the same time that way there
4:12 was no discrepancies between the two the
4:15 purpose of data storage is to give us an
4:18 audit trail right it gives us evidential
4:21 matter supporting the transactions that
4:25 we're conducting in the AIS system so
4:26 this just goes through the audit trail
4:29 for a particular invoice and you will
4:33 see here is the invoice in our sales
4:36 journal then the full amount of that
4:38 sales journal is in your general ledger
4:43 for accounts receivable you will also
4:46 have a general ledger for credit sales
4:49 as part of that piece so then that would
4:52 be your actual recording of the sale
4:55 then you would have the subsidiary
4:57 ledger then you've got practice in
5:01 Chapter one on what that would look like
5:05 data can is stored in master files or
5:09 transaction files so you would have
5:10 different attributes so here's your
5:12 customer number the name address credit
5:15 limit and balance and basically the
5:18 master file for the customer might have
5:21 this information and including their
5:24 address now the credit limit and balance
5:25 could be different the credit limit
5:28 could also be part of the screen where
5:30 you're entering any customer for the
5:32 first time and then your balance is
5:34 obviously the outstanding balance so
5:36 those and that balance will give you
5:37 further details in the to the
5:41 transaction that comprised that balance
5:43 there are four types of processing or
5:46 crud for short acronyms are only your
5:49 friend so the data processing you have
5:52 to create a record so similar to what a
5:53 row is in Excel
5:56 to add that customer or add a vendor in
5:58 that module then you would like you read
6:01 the data in that module you update any
6:03 previous record of data that needs to be
6:06 possibly showing a cash receipts towards
6:08 the customers account and then you
6:10 delete data we don't really delete too
6:12 much we purge it's possible because
6:13 we're always so afraid
6:15 but deleting data could mean that you're
6:18 just reversing an entry you can have
6:21 batch processing when you do data which
6:22 is you do everything at one particular
6:25 point in time so that fact of activity
6:28 for that day such as sales shipped would
6:30 be processed in a back to the sales
6:32 journal or real time which is basically
6:35 when it occurs so obviously if every
6:37 time you scan something at Walmart it
6:39 automatically generates the journal
6:41 entry to record the revenue that would
6:45 be real-time output is basically
6:48 database files online or soft copy and
6:51 printed out hard copy with everything
6:53 being automated and then the efficiency
6:55 of going paperless obviously online
6:58 seems have been more plausible when you
7:00 do you might have to just print things
7:02 out such as an invoice to the customer
7:04 you might have to print a report for
7:06 your monthly sales in order to calculate
7:09 sales persons commission or you can
7:11 actually do a query which is that where
7:12 you're retrieving information from
7:15 several pieces of data such as tables
7:17 for customer with the address and then
7:20 tables for sales and cash receipts to
7:22 that customer to get your accounts
7:26 receivable balance ERP systems
7:29 enterprise resource planning basically
7:31 gives all the activities for an
7:33 organization puts them all together so
7:35 big in production that will say what
7:37 we're going to produce payroll will
7:38 probably tell us all of our employees
7:40 and what they make and the current pay
7:44 sales gives us the activity that we're
7:46 actually selling a product purchasing we
7:48 might be replenishing our inventory and
7:51 financial reporting most of these areas
7:55 can also be a module in your AIS system
7:59 advantages of ERP it's a better flow of
8:03 the information so it's a central
8:06 database or a data warehouse
8:09 it can have several access points once
8:13 the data is captured then it you know
8:15 you don't longer need the sale to enter
8:16 data about a customer than accounting
8:19 has that same data for invoicing you can
8:22 you can go to that table and that record
8:23 of that customer and use the same
8:26 information so there's no duplication it
8:29 also controls of the data we can enhance
8:31 security controls giving people access
8:33 to the system for only those portions
8:35 that they need so if you're processing
8:37 tax receipts and they are you would just
8:40 have access possibly to the air module
8:42 and it gives you a big standardization
8:45 or a better workflow and that helps you
8:47 get those standardization so the
8:49 procedures are second nature the
8:50 internal controls are follow of the
8:54 reports are generated know the bad side
8:57 of ERP could be costly way long to
9:00 implement it complex and there's
9:02 obviously with anything employees or
9:04 people they're just not susceptible to
9:07 change but the cost and the complexity
9:09 probably make it the big donor probably
9:11 the biggest disadvantages why several
9:13 companies do not enter eight an ERP
9:16 system so these are all the terms that
9:18 you've learned in this chapter hopefully
9:19 this helps you get a better
9:23 understanding of a is and transaction
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