Chapter 1

The information value chain represents the overall transformation from a business need and business event (like each individual sale of U.S. flag) to an ultimate decision. The information value chain might be represented considering the purchase of a CD at Best Buy in the following way:

The CD will be recorded as sales revenue and then after deducting its costs will add to or subtract from corporate income. The cash from the CD sale will also add to the operating cash flows.

The specific CD will be recorded in the information as a sale to monitor which CDs are selling within Best Buy. This will help Best Buy and its suppliers know which CDs are selling and which type of CDs should be reordered. The type of CD will also help the marketing department better understand its customers and their respective demographic profile to better market to them.

In addition, knowing the location of the CD sale will also help decision makers know where its sales are occurring.

The CEO can look at the profitability of CDs overall, the specific types of CDs that are selling and the location of those sales all due to the information value chain.

Accountants have a role as a business analyst. That is, they gather information to solve business problems or address business opportunities. They determine what information is relevant in solving business problems, then create or extract that information and finally analyze the information to solve the problem. An AIS provides a systematic means for accountants to get needed information and solve a problem.

While a computer is very good at reliably collecting, processing and producing information, the role of the accountant when serving as a business analyst will continue to be able to assess the problems the business is facing and work to provide information that will address it.