IT Governance
A C C O U T N I N G I N F O R M A T I O N S Y S T E M
A Group 3 presentation
R e f e r e n c e : A I S C o n t r o l s a n d P r o c e s s s e s
B o o k T h i r d E d i t i o n , C h a p t e r 5 , T u r n e r,
W e i c k g e n a n n t , a n d C o p e l a n d

STUDY
OBJECTIVES
An introduction to IT
Governance and its role in
strategic management
2 An overview of the system
development life cycle (SDLC)
1
The elements of the systems
planning phase of the SDLC
3

STUDY
OBJECTIVES
The elements of the systems
analysis phase of the SDLC
5 The elements of the systems
design phase of the SDLC
4
The elements of the systems
implementation phase of the
SDLC
6

STUDY
OBJECTIVES
The elements of the
operation and maintenance
phase of the SDLC
8 The critical importance of IT
governance in an organization
7
Ethical considerations related
to IT governance
9

ONE
IT Governance
An introduction to IT
Governance and its role in
strategic management

Chapter 5|SO 1
In the business
environment of today, IT
systems are critical to the
success of the organizations
that use them.

Chapter 5|SO 1
To ensure that a company is
using IT to its competitive
advantage, it must continually
investigate and assess the viability
of using newer information
technologies.

Chapter 5|SO 1
But how does a company
decide which IT systems are
appropriate to its operations?
Moreover, how does a company
decide, for example?

Company Decision
Which accounting
software package to
buy?
When the company has
outgrown its accounting
software or when to
upgrade that accounting
software?
Whether to use IT
systems to sell
products on the Web?
Whether to establish a
data warehouse for
analyzing data such as
sales trends?
Whether to use an ERP
system or customer
relationship management
(CRM) software?

Chapter 5|SO 1
Strategic management
is the process of determining the strategic
vision for the organization, developing the
long‐ term objectives, creating the
strategies that will achieve the vision and
objectives, and implementing those
strategies.

Chapter 5|SO 1
To achieve the purposes of
strategic management, an
organization must also properly
manage, control, and use IT systems
that enable the organization to
achieve its strategies and objectives.

[A] Structure of relationships and processes to direct
and control the enterprise in order to achieve the
enterprise’s goals by adding value while balancing risk
versus return over IT and its processes. IT governance
provides the structure that links IT processes, IT
resources, and information to enterprise strategies
and objectives.
IT Governance Defined

Company Decision
1
Aligning IT
strategy with
the business
strategy
2
Cascading
strategy and
goals down
into the
enterprise
4
Insisting that
an IT control
framework be
adopted and
implemented
5
Measuring IT’s
performance
3
Providing
organizational
structures that
facilitate the
implementation of
strategy and goals

Models of an IT Framework
1 (ISACA) &(COBIT) 2 (ISO) 27002 3 (ITIL)
- Information Systems
Audit and Control
Association &
- Control Objectives for
IT
- The International
Organization for
Standardization
- Code of Practice for
Information Security
Management
- The Information
Technology
Infrastructure
Library

Aspects of IT Governance
1 2 3
The definition
of IT
Governance
The role of the
IT governance
committee, and
The system
development
life cycle

Chapter 5|SO 1
IT systems are critical to the
long‐term success of the
organization, and board involvement
in IT oversight is therefore
necessary.

1. Articulate and communicate the business
direction to which IT should be aligned. The
board should set and communicate long‐term
company strategy and objectives.
2. Make sure it is aware of the
latest developments in IT, from a
business perspective.

3. Insist that IT be a regular item on
the agenda of the board and that it be
addressed in a structured manner.
4. Be informed about how and how
much the enterprise invests in IT
compared with its competitors’
investments.

5. Ensure that the reporting level of
the most senior information technology
manager is commensurate with the
importance of IT.
6. Ensure that it has a clear view of
the major IT investments, from a
risk‐and‐return perspective.

7. Receive regular progress
reports on major IT projects.
8. Receive IT performance reports
illustrating the value of IT.

9. Ensure that suitable IT resources,
infrastructures, and skills are available to
meet the required enterprise strategic
objectives.

Chapter 5|SO 1
The board and top
management must ensure that the
organization has processes to
accomplish the following tasks:

1. Continually evaluate the match
of strategic goals to the IT systems in
use.
2. Identify changes or improvements
to the IT system that will enhance the
ability to meet strategic organizational
objectives.

3. Prioritize the necessary
changes to IT systems.
4. Develop the plan to design and
implement those IT changes that are
of high priority.

5. Implement and maintain the IT
systems.
6. Continually loop back to Step 1.

Necessities in the strategic
management of IT systems:
1 2
Is a group of senior
managers selected to
oversee the strategic
management of IT.
The formal process
that many organizations
use to select, design, and
implement IT systems.
System Development Life Cycle (SDLC)
IT Governance Committee

TWO
IT Governance
An Overview of the SDLC

Chapter 5|SO 2
The systems development life
cycle (SDLC) is a systematic process
to manage the acquisition, design,
implementation, and use of IT
systems.

Chapter 5|SO 2
The IT governance
committee is usually made up
of the top managers of the
organization.

IT Governance Committee
Chief Executive
Officer (CEO)
Chief Financial
Officer (CFO)
Chief Information
Officer (CIO)
Top managers
from User
Departments
Top
management
from Internal
Audit

01
01
02
SYSTEMS PLANNING
Is the evaluation of long‐term,
strategic objectives and the prioritization of
IT systems in order to assist the organization
in achieving its objectives.
Is a study of the current system
to determine the strengths and
weaknesses and the user needs of that
system.
Phases of SDLC
SYSTEMS ANALYSIS

03
01
04
SYSTEMS DESIGN
Is the creation of the system that
meets user needs and that incorporates the
improvements identified by the systems
analysis phase.
Is the set of steps undertaken to
program, test, and activate the IT
system as designed in the system design
phase.
Phases of SDLC
SYSTEMS IMPLEMENTATION

05
OPERATION AND MAINTENANCE
Is the regular, ongoing functioning
of the IT system and the processes to fix
smaller problems, or “bugs,” in the IT
system.
Phases of SDLC

Process Map
1 2 3 4

Chapter 5|SO 2
Conceptual Design is the
process of matching alternative
system models with the needs
identified in the system analysis
phase.

Chapter 5|SO 2
Evaluation And Selection is the
process of assessing the feasibility
and fit of each of these alternative
conceptual approaches and
selecting the one that best meets
the organization’s needs.

03
01
04
SOFTWARE SELECTION
A software that is purchased,
that the company must undergo a set
to select the best software for its needs.
Is the process of designing the
outputs, inputs, user interfaces,
databases, manual procedures, security
and controls, and documentation of the
new system.
Phases of SDLC
DETAILED DESIGN

THREE
IT Governance
Elements of the Systems
Planning Phase of the SDLC

SYSTEMS PLANNING
The IT governance committee must have
procedures to follow that will assist it in
prioritizing the most important needs of the IT
system for immediate modification or upgrade.
Phases of SDLC

Process Map
1 2 3 4

A
01
B
THE MATCH OF IT SYSTEMS
TO STRATEGIC OBJECTIVES
The IT governance committee must
evaluate proposed changes to IT systems in
terms of their usefulness in assisting the
organization to achieve its objectives.
Feasibility refers to the
realistic possibility of affording,
implementing, and using the IT
systems being considered.
TWO BROAD ASPECTS
FEASIBILITY STUDY

Feasibility Aspects
Economic
Operational Schedule
Technical

PLANNING AND OVERSIGHT
The proposed changes that must be delayed
may be reviewed again in the future when the IT
governance committee reassesses the strategic
match of IT and feasibility. These processes are
ongoing.
Phases of SDLC

Committee Initiation
Formally announce the
project they have chosen to
undertake.
Budget the funds necessary
to complete the SDLC.
Assign the project team
that will begin the next
phase, the systems analysis.
Continue oversight and
management of the project team
and proposed IT changes as the
remaining SDLC phases occur.

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