Information Technology and Business Applications
Systems and data
A business information system collects, processes, stores and distributes data to support decisions. Transaction processing systems handle routine records; management information systems summarise; decision support systems model alternatives; executive systems present high-level indicators. A database organises data into tables with keys; a relational database links tables by primary and foreign keys, reducing duplication.
Controls and security
Internal controls in IT include access controls, segregation of duties, audit trails, backups and disaster recovery plans. Confidentiality, integrity and availability form the standard security triad. Threats include malware, phishing, insider misuse and weak passwords. Encryption protects data in transit and at rest.
Business applications
Enterprise resource planning integrates finance, inventory and human resources in one system. Customer relationship management tracks sales and service. E-commerce raises issues of payment security, privacy and consumer protection. Cloud computing trades local control for scalability.
Traps to watch
- Confusing data (raw facts) with information (processed, decision-useful).
- Assuming a backup alone is a disaster recovery plan - recovery also needs procedures and testing.
- Overlooking segregation of duties: one person should not both authorise and record a payment.
- Treating spreadsheets as adequate for high-volume transactional records.
Worked example
A clerk both approves supplier payments and updates the ledger. This breaches segregation of duties, allowing concealment of fraud. Rule of thumb: authorisation, recording and custody of assets should sit with different people.