Question

When a service organization provides services that affect the initiation, execution, processing, or reporting of a user company's transactions, those services are:?

Answer 1

Those services are considered to be part of the user company's information system.
The information system obviously provides relevant information about something - given that here services are given which may have an effect on the initiation, execution, processing, or reporting of a user company's transactions, they do belong to the information system of that company.