A transaction processing system (TPS) processes routine business transactions in large volumes to increase efficiency. A TPS handles accounting and finance transactions like processing orders, tracking accounts receivable/payable, and managing inventory. It collects, stores, and disseminates data from basic business transactions to provide the backbone for other organizational systems. A TPS uses a database to process large amounts of structured input and output data on a regular basis with a high level of accuracy, integrity, security, reliability and speed.

1. TRANSACTION PROCESSING SYSTEMS
PRESENTED BY,
MELVIN T MATHEW

2. What is a TPS?
 An information system designed to process
routine business transactions
 seeks time- and cost-efficiency by automating
repetitive operations in large volumes
 centers around accounting and finance
transactions
 e.g; airline reservation systems, order
entry/processing systems, bank’s account
processing systems

3. Transaction Processing Systems
 A transaction is an elementary activity
conducted during business operations (e.g.
merchandise sale).
 Earliest Information Systems in organizations.
 Support the monitoring, collection, storage,
processing, and dissemination of the
organization’s basic business transactions.
 Provides backbone for many other applications
involving other support systems.

4. Data Input Data Processing Output Generation
Data Storage
A Transaction Processing System model

5. Transaction Processing Systems
 Large amounts of data are processed.
 The sources of data are mostly internal, and
the output is intended mainly for an internal
audience.
 The TPS processes information on a regular
basis: daily, weekly, monthly, etc.
 Large storage (database) capacity is required.
 High processing speed is needed due to the
high volume.

6. The Major Characteristics of TPS
 TPS basically monitors and collects past
data.
 Input and output data are structured (i.e.,
standardized).
 A high level of accuracy, data integrity,
and security is needed.
 High reliability is required.

7. Batch Processing
On-line Processing
Types of tps

8. Transaction
Data
Data
Processing
Trans.
File
New
Master
FileOld
Master
File
Documents/
Reports
Batch Processing

9. Online TPS (OLTP)
 Transactions are processed in real time
 Required for any “modern” application where
time is critical
 Well supported by client/server computing model

10. On-lineProcessing
On-line
Data
Processing
Documents/
Reports
Transaction
Data
Inquiries/
Reponses
Transaction
Data
Transaction
Data

11. TPS Applications
 Order Processing
 Purchasing
 Accounts Receivables & Accounts Payables
 Receiving & Shipping
 Inventory on Hand
 Payroll
 General Ledgers

12. Business Transactions in a Factory
 Payroll: employee time cards, employee pay and
deductions, payroll checks.
 Purchasing: purchase orders, deliveries, payments
(accounts payable)
 Sales: sales records, invoices and billing, accounts
receivable, sales returns, shipping
 Manufacturing: production reports, quality-control
reports
 Finance and Accounting: financial statements, tax
records, expense accounts
 Inventory management: materials usage, inventory
levels

13. Transaction Processing in an HRIS
Keep inventory of personnel
payroll preparation
compute salaries and incentive plans

14. Accounting Activities TPS