Classification based on the nature of interaction with environment

• Transformational Systems: These are systems that transform inputs received from the environment in order to generate reports (output).

• Reactive Systems: These are systems ``characterized by being, to a large extent, event-driven, continuously having to react to external and internal stimuli" (Harel, 1987).

The components of accounting systems such as payroll, general ledger are, it should be obvious, usually batch processing systems, and also transaction processing systems that are transformational systems. Systems for determination of sample sizes for audit testing, on the other hand may be decision support systems. Systems aiding provision for doubtful accounts (or loan loss reserves for financial institutions) may be expert systems.