Functional system testing is:
-
testing that the system functions with other systems
-
testing that the components that comprise the system function together
-
testing the end to end functionality of the system as a whole
-
testing the system performs functions within specified response times
Functional system testing tests the end-to-end functionality of the system as a whole, verifying that the complete system works correctly for user scenarios. It's not about integration (component interaction) or interoperability (system-to-system).
Functional system testing verifies the complete, end-to-end behavior of the whole system against its functional requirements, exercising it the way an end user would. Testing interaction with other systems is integration/interface testing, testing components working together is integration testing, and testing response times is non-functional (performance) testing — all distinct test types from functional system testing.