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HAND OUT

DIAGRAM FLOWCHART

Systems Development and


Documentation Techniques

Audit Trail
Source

Journal

Document

Financial

General

Statements

Ledger

General

Financial

Ledger

Statements

Journal

Source
Document

Accountants should be able to trace in both directions.


Sampling and confirmation are two common techniques.

Computer-Based Systems
The audit trail is less observable in computerbased systems than traditional manual
systems.
The data entry and computer programs are
the physical trail.
The data are stored in magnetic files.

Computer Files

Master File - generally contains account data (e.g.,


general ledger and subsidiary file)
Transaction File - a temporary file containing
transactions since the last update
Reference File - contains relatively constant
information used in processing (e.g., tax tables,
customer addresses)
Archive File - contains past transactions for
reference purposes

Documentation Techniques

Documentation in a CB environment is
necessary for many reasons.

Five common documentation techniques:


Entity

Relationship Diagram
Data Flow Diagrams
Document Flowcharts
System Flowcharts (manual and computer)
Program Flowcharts

Entity Relationship Diagram


(ERD)
is a documentation technique to represent the
relationship between entities in a system.
The REA model version of ERD is widely
used in AIS. REA uses 3 types of entities:

resources

(cash, raw materials)


events (release of raw materials into the
production process)
agents (inventory control clerk, vendor,
production worker)

Cardinalities

represents the numerical mapping


between entities:
one-to-one
one-to-many
many-to-many

Cardinalities
Entity
Sales-

Relationship

person

Customer

Vendor

Assigned
Places

Supply

Entity

Car
Type

Order

Inventory

Learning Objective 1

Prepare and use data flow


diagrams to understand,
evaluate, and design
information systems.

2003 Prentice Hall Business Publishing,


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Data Flow Diagrams (DFD)

use symbols to represent the


processes, data sources, data flows,
and entities in a system
represent the logical elements of the
system
do not represent the physical system

Data Flow Diagram Symbols


Entity

Data Store

Name

Name

N
Process
Description

Direction of
data flow

Data Flow Diagrams


A data flow diagram (DFD) graphically
describes the flow of data within an
organization.
It is used to document existing
systems and to plan and design new
ones.
There is no ideal way to develop a
DFD.

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Data Flow Diagrams

A data flow diagram (DFD) is


composed of the following four basic
elements:
1
2
3
4

Data sources and destinations


Data flows
Transformation processes
Data stores

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Guidelines for
Drawing a DFD
1.
2.
3.
4.
5.
6.
7.
8.

Understand the system.


Ignore certain aspects of the system.
Determine system boundaries.
Develop a context diagram.
Identify data flows.
Group data flows.
Identify transformation processes.
Group transformation processes.
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Guidelines for
Drawing a DFD, continued
9.
10.
11.
12.
13.
14.
15.

Identify all files or data stores.


Identify all data sources and destinations.
Name all DFD elements.
Subdivide the DFD.
Give each process a sequential number.
Repeat the process.
Prepare a final copy.

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Data Flow Diagram Symbols


Data Source and destinations
Data Flows

Transformation Processes

Data Stores
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Data Flow Diagram Symbols

A data source or data destination symbol on the


DFD represents an organization or individual that
sends or receives data that they system uses or
produces.
A data flow represents the flow of data between
processes, data stores and data sources and
destinations.
A transformation process represents the
transformations of data.
A data store is a temporary or permanent repository
of data.
A data dictionary contains description of all the
elements, stores, and flows in a system.
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Data Flow Diagrams


Data
source
(A)

Data flow (B)

Process
(C)

Data flow (D)

Data flow (E)


Data
destination
(J)
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Data Flow Diagrams


Data store (H)
Data flow (G)
Data flow (D)

Process
(F)

Data flow (I)

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Data
destination
(K)

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Data Flow Diagrams

Customer
(A)

Customer
payment (B)

Process
payment
(C)

Remittance data
(D)

Deposit (E)
Bank
(J)
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Data Flow Diagrams


Accounts
receivable
(H)
(G)
Remittance
Receivables
data
information
Update
(D)
(I)
receivables
(F)
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Credit
manager
(K)
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Data Flow Diagrams

Data flow diagrams are subdivided


into successively lower levels in order
to provide increasing amounts of
detail.

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Data Flow Diagrams


The highest-level DFD is referred to
as a context diagram.
What is the context diagram for S&S
payroll processing?

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Data Flow Diagrams

Departments

Human
resources

Time
cards
Payroll
processing
system
Employee
data
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Data Flow Diagrams


Tax reports and payments
Payroll
processing
system

Employee
paychecks
Payroll
check

Government
agencies
Employees
Bank

Management
Payroll report
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Data Flow Diagrams

The context diagram for S&S payroll


processing shows that the payroll
processing system...

receives time cards from different


departments.
receives employee data from the
human resources department.

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Data Flow Diagrams

When these data are processed, the


system produces...

tax reports and payments for


governmental agencies.
employee paychecks.
a check to deposit in the payroll
account at the bank.
management payroll reports.
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Learning Objective 2

Draw flowcharts to
understand, evaluate,
and design
information systems.

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Flowcharts
A flowchart is an analytical technique
used to describe some aspect of an
information system in a clear, concise,
and logical manner.
Flowcharts use a standard set of
symbols to pictorially describe
transaction processing procedures.

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Flowchart Symbols

Flowcharting symbols can be divided


into the following four categories:
1
2
3
4

Input/output symbols
Processing symbols
Storage symbols
Flow and miscellaneous symbols

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Flowcharting Symbols:
Some Input Output Symbols
Symbol

Name

Document
Online keying
Display
Input/output;
Journal/ledger
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Flowchart Symbols:
Some Processing Symbols
Symbol

Name

Manual operations
Computer processing
Auxiliary operation
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Flowchart Symbols:
Some Storage Symbols
Symbol

Name

Magnetic disk

Magnetic tape
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Flowchart Symbols: Some Flow


and Miscellaneous Symbols
Symbol

Name

Document or processing flow


On-page connector
Off-page connector
Terminal
Decision
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What are Document


Flowcharts?

A document flowchart illustrates the flow of


documents and information between areas
of responsibility within an organization.
A document flowchart is particularly useful
in analyzing the adequacy of control
procedures.
Flowcharts that describe and evaluate
internal controls are often referred to as
internal control flowcharts.
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Documents Flowcharts
illustrate the relationship among processes
and the documents that flow between
them
contain more details than data flow
diagrams
clearly depict the separation of functions in
a system

Symbol Set for Document Flowcharts


Terminal showing source

Calculated batch total

or destination of documents
and reports
Source document or

On-page connector

report
Manual operation

File for storing source


documents and
reports

Off-page connector

Description of process
or comments

Accounting records
(journals, registers,
logs, ledgers)

Document flowline

Sales Department

Credit Department

Warehouse

Shipping Department

Customer
Customer
Order
Prepare
Sales
Orders
Sales
Sales
Order
#1
Sales
Order Sales
#1
Order #1
Order #1

First Stages in Constructing Document Flowchart Showing


Areas of Activity

Sales Department

Credit Department

Warehouse

Shipping Department

Sales

Customer

Sales

Order #1

Order2

Customer

Checks

Order

Sales

Credit

Credit

Records

Prepare
Sales

Picks

Stock

Goods

Records

Order
4
Sales
Order3

Signed Sales

Orders
Customer

Order #1

Sales
Order
Sales
Order
#1
Sales
Order Sales
#1
Order #1
Order #1

Sales

Picks

Order2

Goods
Sales
Order
4
Sales

Signed Sales

Order3

Order #1

Sales
Order2

Distribute
SO and

Customer
Signed Sales
Order
Order #1

File Sales
Sales
Order
4
Order3
Sales
Order2

A
Customer

Finished Document Flowchart


Showing Areas of Activity

What are System


Flowcharts?
System flowcharts depict the
relationship among the input,
processing, and output of an AIS.
A system flowchart begins by
identifying both the inputs that enter
the system and their origins.
The input is followed by the
processing portion of the flowchart.

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What are Computer


System Flowcharts?
The resulting new information is the
output component.
System flowcharts are an important
tool of system analysis, design, and
evaluation.

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What are Computer


System Flowcharts?
Input

Storag
e

Process

Output
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System Flowcharts
are used to represent the relationship
between the key elements--input sources,
programs, and output products--of computer
systems
depict the type of media being used (paper,
magnetic tape, magnetic disks, and
terminals)
in practice, not much difference between
document and system flowcharts

Systems Flowchart Symbols


Hard copy

Terminal input/
output device

Computer process

Process flow
Real-time

Direct access storage

(online)

device

connection
Video display
device

Magnetic tape

Sales Department Computer Operations


Department
Customer
Credit Hist

Warehouse

Shipping Department

Edit and

Customer
Order

Credit Check

File

Sales
Orders

Terminal
Update

AR File

Program
Inventory

First Stages in Constructing System Flowchart


Showing Areas of Activity

Sales Department Computer Operations


Department
Customer
Edit and

Customer
Order

Warehouse
Sales

Credit file

Order1

Credit Check

Sales

Sales
Orders

Terminal

AR File

Update
Customer

Shipping Department

Program

Picks

Stock

Goods

Records

Order
3
Sales
Order2

Sales

Picks

Order1

Goods

Inventory

Order

Sales
Sales
Order2
Order3

A
Sales

Sales

Sales
Order
3

Order1

Order2
Sales
Order1

Finished System Flowchart Showing All Facts


Translated into Visual Symbols

Customer

What are Program


Flowcharts?
A program flowchart describes the
specific logic to perform a process
shown on a systems flowchart.
A flow line connects the symbols and
indicates the sequence of operations.
The processing symbol represents a
data movement or arithmetic
calculation.

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What are Program


Flowcharts?
Input data
If a condition is met

No

Yes
Perform calculation
Update record
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What are Program


Flowcharts?

The input/output symbol represents either


reading of input or writing of output.
The decision symbol represents a
comparison of one or more variables and
the transfer of flow to alternative logic paths.
All points where the flow begins or ends are
represented by the terminal symbol.

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Flowchart for Processing


Credit Orders
Start

Enter
sales
order
Approved
for credit?

No

Reject
order

No

Backorder

Yes
Inventory
available?
Yes
Fill order

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Program Flowcharts
illustrate the logic used in programs
Program Flowchart Symbols
Logical process

Terminal start or
end operation
Input/output

Decision

operation
Flow of logical
process

S a le s O rd e r
1
C re d it / C u s to m e r
S e rv ic e
2

R EV EN U E C Y C LE
(S U B S Y S T E M )

S h ip p in g
3
B illin g / A c c o u n ts
R e c e iv a b le
4 /5

C a s h R e c e ip ts /
C o lle c tio n s
6

Journal Vouchers/Entries
How do we get them?

Billing Department prepares a journal voucher:


Accounts Receivable
Sales
CR

Inventory Control Dept. prepares a journal


voucher:
Cost of Goods Sold
Inventory

DR

DR
CR

Cash Receipts prepares a journal voucher:


Cash

DR
Accounts Receivable

CR

Revenue Cycle Databases

Master files

customer master file


accounts receivable master file
merchandise inventory master
file

Transaction and Open


Document Files

sales order transaction file


open sales order transaction
file

sales invoice transaction file


cash receipts transaction file

Other Files
shipping and price data
reference file
credit reference file (may
not be needed)
salesperson file (may
be a master file)
Sales history file
cash receipts history file
accounts receivable
reports file

DFD of Sales Order Process

Sales Order Process Flowchart

Sales Order Process Flowchart

Differences Between
DFDs and Flowcharts
DFDs emphasize the flow of data and
what is happening in a system, whereas a
flowchart emphasizes the flow of
documents or records containing data.
A DFD represents the logical flow of data,
whereas a flowchart represents the
physical flow of data.

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Differences Between
DFDs and Flowcharts
Flowcharts are used primarily to
document existing systems.
DFDs, in contrast, are primarily used in
the design of new systems and do not
concern themselves with the physical
devices used to process, store, and
transform data.

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Differences Between
DFDs and Flowcharts
DFDs make use of only four symbols.
Flowcharts use many symbols and
thus can show more detail.

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