AIN1501 Summary on the whole module (SIMPLE, EASY and HUGE HELP). The module has been summarized into this document to help you grasp the module easier, use it for upcoming assignments and exams. This document is searchable and will save you time and lesson the work load!
1. Define Information
Information is a set of facts or data organised and processed in such a way that it
provides additional value beyond that of the facts themselves. Information is derived
from data or raw facts that represent real-world elements. Information is data that
have been processed in such a way as to be meaningful to the person who receives
it. This information provides knowledge that leads the user to make decisions.
Activity -> Data -> Information -> Knowledge -> Decisions
2. Define Data
Data are the raw material available for processing into information. Data consist of
numbers, letters, audio and video data and relate to facts, events and transactions.
3. Characteristics of Information
Information should be without any errors. Inaccurate data
Accurate entered into a process will provide inaccurate information.
Information should be checked to ensure correctness.
Information should be easily available to users in order to meet
Accessible
their needs.
Information needs to include the latest possible information
Up-to-date information
and recording time of data should be minimised.
Some users may need details of all events while others need a
Detail information summary. Information should contain all the important facts,
but no more than are necessary.
Flexibility Information is flexible if it is usable for more than one purpose
Relevance of information Information should be relevant to the needs of the users.
The value of information should always be balanced with the
Cost- effectiveness
cost of producing the information.
Information is reliable if one can depend on it. Reliability
Reliability
depends on the source of information. A rumour is not reliable.
Timely Information should be delivered when it is needed.
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,AIN1501 - Summary
Information should not be overly complex and should be
supplied in the required format. Too much information or
Format of information
information in the wrong format leads to difficulty in
determining what is important.
4. Users and uses – Internal and external
4.1. Internal
4.1.1. Management: To coordinate the activities of the organisation, to do future
planning, to make important decisions based on the information, to measure
performance and control activities. Managers need internal information
about their budgets and products in order to carry out their financial planning
and make informed decisions. They also need external forecasting
information on the economy, as well as on interest and exchange rates.
4.1.2. Financial managers: Financial managers need information on the financial
performance of the organisation in order to make decisions on cash flow and
financing. Hence, management financial statements are an internal source
of information. Financial managers also need external information on
possible sources of finance in order to make financing decisions.
4.1.3. Production managers: Internal information on sales quantities and sales
forecasting is needed to control and plan the production process. Production
managers use external information on new technology and production
processes to improve the performance of the department.
4.1.4. Staff managers: Staff managers use internal information on qualifications
needed and salary levels. External information on employees and their
qualifications should also be available to place employees in appropriate
jobs.
4.1.5. Marketing managers: Internal information needed relates to products, target
markets and prices in order to make decisions on possible promotions and
advertising methods. External information on the different media to use for
advertising and their tariffs is needed, as well as on general market
conditions, the economy and competitors.
4.1.6. Sales managers: Internal information is needed on production costs and all
overhead costs in order to make decisions on sales prices. External
information on clients and their spending patterns is used to approach the
clients and determine opening times for retail outlets.
4.1.7. Purchase manager: Internal information is necessary on the quantity of the
various products or raw material needed by the production department. The
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, AIN1501 - Summary
purchase manager also needs external information on suppliers and prices
in order to make informed decisions on the best quality and prices.
4.1.8. Employees: Employees need to have internal information on the
sustainability of the organisation for job security reasons and external
information on labour laws and unions.
4.2. External
4.2.1. Shareholders: Shareholders need to make informed decisions on whether to
hold or extend their investment or to look at other investments. In order to
make these decisions they need internal information on the financial and
overall performance of the organisation and external information from other
organisations.
4.2.2. Suppliers: Suppliers need internal information on the sustainability and
creditworthiness of the organisation for future planning and on products and
services in order to supply the organisation with excellent service. External
information on creditworthiness is available from references and credit
bureaus.
4.2.3. Customers: Customers need internal information about products and
services in order to make decisions on what and where to buy. They also
need information on things like discount, interest rates and payment terms,
and whether finance is available or not. Customers can use external
information on the products and services of different suppliers for
comparison purposes.
4.2.4. Financial institutions: In order to supply finance, financial institutions need
internal financial information to determine the creditworthiness of the
organisation. This creditworthiness can also be evaluated from external
sources, such as references and credit bureaus.
4.2.5. Government: The most important need for information by the government is
for use by the South African Revenue Services (SARS). SARS needs
internal financial information to determine the tax liability of the organisation.
On the other hand, it also needs information from external sources like
banks and other organisations to obtain information on the organisation's
earnings. Payroll, taxes and employees' retirement fund deductions are also
reported to SARS.
4.2.6. Possible future employees: Future employees need access to internal
information on the sustainability of the organisation for job-security reasons
and external information on labour laws and unions. Information from
external sources, such as the published financial statements, can also help
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