Chapter 6: Documenting Accounting Information Systems

2. Chapter 6:Documenting Accounting Information Systems • Introduction • Why Documentation Is Important • Primary Documentation Methods • Other Documentation Tools • End-user Computing And Documentation

3. Why Documentation Is Important 1. Depicting how the system works 2. Training users 3. Designing new systems 4. Controlling system development and maintenance costs 5. Standardizing communications with others

4. Why Documentation Is Important 6. Auditing AISs 7. Documenting business processes 8. Complying with the Sarbanes-Oxley Act 9. Establishing accountability

5. Example Flowchart

6. Primary Documentation Methods • Data Flow Diagrams • Document Flowcharts • System Flowcharts • Process Maps

7. Data Flow Diagrams • Uses • Used in systems development process • Tool for analyzing an existing system • Types • Context • Physical • Logical

8. Data Flow Diagram Symbols

9. Types of DFDs • Context Diagrams • Overview of the system • High-level • Physical Data Flow Diagrams • Focuses on the physical entities of organization • Logical Data Flow Diagrams • Emphasizes tasks of participants

10. Context Diagram

11. Physical Data Flow Diagrams • Focus on physical entities, tangible documents, and reports flowing through the system • List job titles of employees • Simple, more readable, and easier to interpret

12. Physical Data Flow Diagrams

13. Logical Data Flow Diagrams • Identifies what participants do • Bubble indicates a task the system performs • Help designers decide: • System resources to acquire • Activities employees must perform • How to protect and control these systems

14. Logical Data Flow Diagrams

15. Decomposition • Exploding data flow diagrams to create more detail • Level 0 data flow diagrams • Exploded into successive levels of detail (3.0 – Process Paycheck) • Level 1 data flow diagrams • 3.1 – Compute gross pay • 3.2 – Compute payroll deductions

16. Decomposition – Exploded View of “Process Paycheck” (3.0)

17. Guidelines for Drawing DFDs • Avoid detail in high level DFDs • Approximately five to seven processes in each Logical DFD • Different data flows should have different names • All data stores have data flows into and out of them, unless they are used for archiving • Include temporary files

18. Guidelines for Drawing DFDs • Final recipients of system information are external entities • Personnel or departments processing data of the current system are internal entities • Display only normal processing routines inhigh-level DFDs • Use only one entity to represent several system entities that perform the same task

19. Document Flowcharts • Traces the physical flow of documents through an organization • Used to analyze systems for weaknesses in controls and reports • Begins by identifying departments and groups that handle the documents

20. Common Document Flowcharting Symbols

21. Common Document Flowcharting Symbols

22. A Simple Document Flowchart

23. A Document Flowchart

24. Guidelines for Drawing Document Flowcharts • Identify all departments involved • Classify documents and activities by department • Identify documents by numbers or color • Account for the distribution of each copy of a document.

25. Document Flowcharting Guidelines • Use on-page and off-page connectors • Coordinate connectors by letter or number • Annotate unclear activities • Identify filing sequence when necessary • Avoid acronyms that could cause confusion • Consider automated flowchart tools

26. Study Break #1 • The diagram here is most likely a: • Document flowchart • System flowchart • Data flow diagram • Program flowchart

27. Study Break #2 • In the diagram, the arrow represents: • A wireless transmission • A telephone call • An information flow • A management order to a subordinate

28. System Flowcharts • Utilize standardized symbols • Concentrate on the computerized data flows • Depict electronic job stream of data • Illustrate an audit trail through AIS

29. Common System Flowchart Symbols

30. Common System Flowchart Symbols

31. System Flowcharting Guidelines • Arrange to read from top to bottom andleft to right • Use standardized symbols • There must be a process symbol separating an input and output symbol (Sandwich rule)

32. Systems Flowcharting Guidelines • Use on-page and off-page connectors • Sketch a flowchart before designing the final draft • Use annotated descriptions and comments in flowcharts for clarification

33. System Flowchart Example

34. System Flowchart Example (continued)

35. Process Maps • Document business processes in easy-to-follow diagrams. • Auditing uses: • Understand operations • Document understanding • Identify internal control weaknesses and problems

36. Process Map - Order Fulfillment Process

37. A Second-level Process Map

38. Guidelines for Drawing Process Maps • Identify and define the process of interest • Understand the purpose for the process map • Meet with employees to acquire input • Remember that processes have inputs, outputs, and enablers

39. Guidelines for Drawing Process Maps • Show key decision points • Pay attention to the level of detail you capture • Avoid mapping the “should-be” or “could-be” (Map what is in place!) • Practice, practice, practice

40. Policies for End-User Computing and Documentation • Formally evaluate large projects • Adopt formal end-user development policies • Formalize documentation standards • Limit the number of employees authorizedto create end-user applications • Audit new and existing systems