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BSc (Hons) Business Information Systems

Cohort: BIS/03/PT BIS/04/FT

Examinations for 2006 - 2007 / Semester 2

MODULE: ENTERPRISE RESOURCE PLANNING

MODULE CODE: BISE123

Duration: 2 Hours and 30 minutes

Instructions to Candidates:

1. This paper consists of Sections A and B.


2. Section A is compulsory.
3. Answer any two questions from Section B.
4. Always start a new question on a fresh page.
5. Questions may be answered in any order but your answers must
show the question number clearly.
6. Total marks 100.

This question paper contains 4 questions and 6 pages.

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SECTION A: COMPULSORY

QUESTION 1: (40 MARKS)

Companies need accounting systems to record transactions and generate financial


statements. The accounting system should let the user summarize data in meaningful
ways. The data can then be used to assist managers in their day-to-day work and in
longrange planning.

(a) Describe the differences between Financial and Managerial Accounting. How
can ERP systems benefit workers in both?
[5 marks]

(b) Assume that an order has been placed with your companys ERP system. These
events occur:

i. The customers credit is automatically checked and found to be acceptable.


The order is recorded for the delivery date requested.

ii. The system schedules the production of the goods. (There is not enough
inventory to ship from stock.)

iii. The system schedules raw material orders from the vendors to make the
goods ordered.

iv. The raw materials are received and stored.

v. The goods are produced and reserved for shipment to the customer.

vi. The delivery is scheduled, and the goods are put on the delivery truck. An
invoice is printed and included with the shipment.

vii. Accounting is notified of the shipments details.

viii. A month later, the customer sends in payment, which is recorded in


accounting.

(Continued)

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Question 1 : (continued)

For each of these events, list the information that must be recorded in the common
database. You do not need to know how to use a database to do this, nor do you need
to understand bookkeeping. At each step, did the wealth of the company increase or
decrease? At each step, how did the companys obligations to outsiders change? At
each step, how did the obligations of outsiders to the company change? You can use
the following table format to answer this question. The first row has been done for you.

Company Company Outsider


Event Wealth Obligations Obligations
See if line of credit See if customer
devoted to debt to company
Check credit limit No change. customer has been exceeds line of
exceeded. credit.
Record sales order
Schedule
production
Order raw
materials
Produce goods, set
aside for shipment
Schedule delivery,
put goods on truck
with invoice
Accounting
notified of
shipment
Customer sends in
payment, recorded
in Accounting

[21 marks]

(Continued)

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Question 1 : (continued)

(c) Given the following information of a company that manufacture two similar product X
and product Y. It is also assumed that the said company is using different legacy
system to store these given information. The company is now thinking to use an
ERP system. Answer the following question for each case given below and show all
your workings to support your answer.

BACKGROUND DATA
Account
Current Current list Receivable
Todays list price , price , balance at start Credit
CASE Date Product X Product Y of business day Limit
1. ABC $1.00 /
CORPORATION 6/29/2006 Unit $1.10 / Unit $8,000 $10,000
$1.00 /
2. KLM Corp 7/3/2006 Unit $1.10 / Unit $5,000 $7,000
$1.00 /
3. ACORN Corp. 7/13/2006 Unit $1.10 / Unit $5,000 $5,000

Current Order
Order Next
Product Qty Date Invoice
CASE Ordered (Unit) Desired Ship To: No.
1. ABC
CORPORATION Product X 1152 7/5/2006 ABC Headquarters A1001
2. KLM Corp Prodyct Y 1440 7/8/2006 KLM Headquarters A1200
ACORN
3. ACORN Corp. Product X 3600 7/15/2006 Headquarters A1300

The date is given in the MM/DD/YYYY format.


Case 1: No documents relating to ABC Corporation are in the system.
Case 2: Purchase Order KLM 82332 for 864 units of Product X. This order is in the
sales order-entry program, but it has not been transferred to the accounting program.
Thus the Accounting does not yet know about this sale.
Case 3: A cheque from ACORN was received in yesterdays mail and entered into the
accounting system. The cheques are for $2,000, applied to invoices from Junes sales.
The sales clerks are working from credit limit printouts at the beginning of the week,
that is two days ago.

(i) Given the current state of the system, will credit be granted or denied for each
cases current order? [7 marks]

(ii) If the system processed data in a more timely way that is using an ERP system,
should credit be granted or denied in each of the above cases? [7 marks]
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SECTION B: ANSWER ANY TWO QUESTIONS

QUESTION 2: (30 MARKS)

Employees are among a companys most important assets. Without qualified and
motivated employees, a company cannot succeed.

(a) List the steps in a typical recruiting process and highlight the steps that involve
interaction with the potential job candidate. [12 marks]
(b) Identify problems in the recruiting process that might lead a candidate to develop
a negative opinion of the company. [3 marks]
(c) How might an effective information system reduce the potential for these
problems? [3 marks]
(d) Assume you are the HR manager at a large manufacturing company. What
metrics or measurements would you develop to assess the performance of the
Production Supervisor, the Sales Manager and the Chief Accountant?
[12 marks]

QUESTION 3: (30 MARKS)

(a) Why an Integrated Data Model is considered the heart of an ERP system?
[5 marks]

(b) ERP solutions have flawlessly displayed the integration of various business
processes and eliminated the duplication of work across various functions.
Explain this statement with a brief business life cycle of a sample company
making use of appropriate diagram where applicable. [10 marks]

(c) Suppose you are the Sales manager of a Large Manufacturing Company, what
Human Resources information do you think you would need to manage your
sales force? [5 marks]

(d) Marketing and Sales (M/S) is the focal point of any company, because they are
responsible for selling the companys product.

Assume you are the Chief Information Officer (CIO) of a large manufacturing
company that is thinking a CRM package, but there is resistance from the CEO.
Do you think implementing CRM is a good idea? How can you convince the CEO
that CRM will make improvements? [10 marks]

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QUESTION 4: (30 MARKS)

(a) ERP systems are designed to provide the information, analysis tools and
communication abilities to support efficient and effective business processes.
Process mapping is one process modelling tool that uses graphical symbols to
document business processes. SAP has developed graphical models for many of
these business processes using the Event Process Chain (EPC).

Develop an EPC diagram for the following Human Resources process:


(i) The current recruitment process for B&H Company takes approximately 90 days.
It begins when a manager has a need for a position. The manager must
complete a requisition and send it to the HR department. The HR reviews and
assigns a number to the requisition and returns it to the manager for approval.
He approves it, obtains the appropriate signatures and then returns it to the HR.
[10 marks]
(ii) Next, HR creates a job posting and announces the position internally first
through the companys intranet, bulletin boards, or a binder of current job
openings. They collect responses for eight days. HR also solicits resumes from
external source s by advertising. HR pre-screens resumes and forwards data on
qualified candidates to the hiring manager for review. The hiring manager
notifies HR of candidates to interview. She also conducts phone screens; if the
phone screen is promising, HR coordinates and schedules an on-site interview.
Candidates interview with the hiring manager and with HR. HR records the
interviews in an applicant flow log. [10 marks]

(b) E-Commerce is transforming the way companies do business. ERP is an essential


component for all forms of e-commerce.

(i) Assume you have just graduated and you land a job at a large manufacturing
company as its new purchasing agent. The person you replaced has just retired
after 35 years in the job. You are eager to use some of the skills you learned at
school. Write a memo to your new boss, the vice president of Supply Chain
Management, on the virtues of e-commerce and why the company should now
do Internet procurement. [8 marks]

(ii) Define Application Service Provider. [2 marks]


***END OF QUESTION PAPER***
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