Comprehensive Overview of Accounting Information Systems - Chapter 8 Study Material

A formal record that describes a system or process

Documentation

What are the 5 reasons companies use documentation for?

1. Complying with laws and regulations

2. Troubleshooting and maintenance

3. Consistency across employees' work and how employees are trained

4. Capturing usable information for process improvements

5. Documenting and evaluating internal control activities

What are the 4 types of documentation?

1. Systems Documentation

2. Program Documentation

3. Operator Documentation

4. User Documentation

Overview of the computer system with details of system design and architecture. Most granular view.

Systems Documentation

Who uses systems documentation and what do they use it for?

1. Developers and Auditors

2. Used to help create new systems, maintain existing systems, and troubleshoot problems

Detailed description of the system's programming logic and source code

Program Documentation

Who uses program documentation and what do they use it for?

1. Programmers

2. Used when programmers unfamiliar with the system must troubleshoot it during an emergency

Information necessary for technical operators to execute and support the system and make it work

Operator Documentation

Who uses operator documentation and what do they use it for?

1. Computer Operators

2. Execution commands, error messages, and verification procedures

Instruction for system users on how to interact with the system to ensure they are successful at using it.

User Documentation

Who uses user documentation and what do they use it for?

1. End users of the system and auditors reviewing documentation

2. Tutorials, system functionalities, tips, common errors and how to resolve them, instructions for the system (inputting and requesting data)

What are the benefits of good documentation?

1. Efficient knowledge transfer

2. Standardized processes

3. Process improvements

4. Effective audits

Used to create, capture, evaluate, and audit processes in the AIS

Documentation

What are the 3 documentation techniques?

1. Documenting the overall business

2. Documenting processes and systems

3. Documenting data

Involves capturing the people who work there or the state of operations and internal controls

Documenting the overall business

A diagram that illustrates the employees in the company and their reporting relationship with one another

Organizational Chart

How do people outside the business, like auditors, understand what is happening in the business?

They use checklists and questionaries

What are the 2 types of organizational structures?

1. Vertical Organizational Structure

2. Horizontal Organizational Structure

This structure has more layers of reporting between the lowest and highest levels

Vertical Organizational Structure

Flat structure with less layers of reporting between the lowest and highest levels

Horizontal Organizational Structure

Can be documented with narrative descriptions that are easier to update or more complex flowcharts

Documenting Processes and Systems

Use written descriptions of systems and processes that describe responsibilities in detail, as well as the processes and controls that are in place

Narratives

Depicts the actions or movements of individuals or items in a complex system or process. Consists of various shapes each with their own meaning

Flowchart

What are the 4 types of flowcharts?

1. Document Flowcharts

2. Systems Flowcharts

3. Program Flowcharts

4. Process Flowcharts

Flowchart that shows the flow of documents, such as physical or digital purchase orders, through a process.

Document Flowchart

Flowchart that shows the flow of information through a system, including how information is accessed and where data is stored.

Systems Flowchart

Flowchart that shows the sequence of coded instructions in a computer program that enable it to perform specified logical and mathematical operations.

Program Flowchart

Flowchart that shows the flow of activity through the company, including key parties and actions that they perform. Are also known as business process diagrams.

Process Flowcharts

A graphical representation of the flow of data in an information system. It describes the processes involved in a system to manage the life cycle of the data, from generation (input) to storage (databases) to reporting (output).

Data Flow Diagram (DFD)

What are some advantages of data flow diagrams

1. Shows system functionality and limits

2. Documents a business process from the perspective of its related data

3. Easier to use than a text description

4. Offers an easy-to-understand system diagram for users to comprehend the data flow

5. Helps new employees understand a system

6. Familiarizes auditors with the system they are auditing

A graphical illustration of all the tables and their relationships in a database

Entity Relationship Diagram (ERD)

What are the three types of entity relationship diagrams?

1. Conceptual ERD

2. Logical ERD

3. Physical ERD

Simplest ERD model that is used by business end users and database designers to capture business needs and to understand the general plan for the database

Conceptual ERD

The ERD model that introduces more detail and is used by database designers to refine the business needs of the database and begin modeling data at a more technical level

Logical ERD

Most complex ERD model that is created by database designers and used by database administrators and developers (along with a database schema) to build and access the database

Physical ERD

What are the 11 shapes of a process flowchart?

1. Terminator

2. Process

3. Flowline

4. Decision

5. Merge

6. Connector

7. Document

8. Input/Output

9. Database

10. Manual Input

11. Manual Operation

Shape: Circle of oval

Use: Marks the start or end of a process, and every flowchart must begin and end with this

Terminator

Shape: Rectangle

Use: Represents an event or step within the flow. Must have one line entering it and can have multiple lines exiting it. Example: Bake cookies

Process

Shape: Arrow

Use: Connects shapes together

Flowline

Shape: Diamond

Use: Represents a yes/no or true/false question that must be answered for the process to continue on the correct flowline. Must have a single flowline entering and 2 exiting it. Example: Was the cookie purchased in store or online.

Decision

Shape: Triangle

Use: Connects 2 or more paths of a flowchart into a single flowline. Multiple flowlines entering and 1 flowline exiting it.

Merge

Shape: Circle

Use: Used when a flowchart is large enough to span multiple pages

Connector

Shape: Rectangle with wavy bottom

Use: Represents a physical or digital document such as an email, report, purchase order, or invoice.

Document

Shape: Parallelogram

Use: Represents data or information coming into the process or leaving the process, such as an order incoming to the bakery.

Input/Output

Shape: Cylinder

Use: Represents data storage. Data is input into the database and information is retrieved.

Database

Shape: Trapezoid

Use: The manual input shape depicts data that is manually input into a system, such as a user typing in their username and password to access the system.

Manual Input

Shape: Trapezoid

Use: Used if the user physically takes an action such as taking a printout of a report and placing it on someone's desk. However there is no new data being input into the system

Manual Operation

Areas within a flowchart that delineate the responsibilities for all activities involved in a business process

Swim Lanes

What are 3 benefits of swim lanes?

1. Provide clarity and accountability by placing activities within the swim lanes of particular individuals, groups, or departments

2. Shows the handoff points between different contributors

3. Helps identify inefficiencies, redundancies, or waste in the process

Diagram created using only four shapes

Data Flow Diagram (DFD)

What are the 4 components in a data flow diagram?

1. External Entity

2. Process

3. Data Store

4. Data Flow

Shape: Rectangle

Use: Represents an input or output of the DFD. Only provide or receive data, they do not process data

External Entity

Shape: Rectangle with line through it

Use: Represents an activity that transforms or changes the data. Must be connected to another external entity

Process

Shape: Pencil

Use: Represents a data repository such as a database or data warehouse. Can begin or end a data flow diagram.

Data Store

Shape: Arrow

Use: Illustrates movement of data between external entities, processes and data stores. Can have arrows on each side to represent a 2 way flow of information

Data Flow

What are the 3 levels to data flow diagrams?

1. Level 0

2. Level 1

3. Level 2

A summary that gives a high-level overview of data flows: It must fit on one page. It provides a snapshot of the data flow. It uses only external entities, one process that represents the entire system, and data flows; no data stores appear at this level. It illustrates the exchange of information between external entities and the system.

Level 0

Highlights the main functions carried out by the system and drills down further into the DFD process by "decomposing" the system. It breaks each process down into further subprocesses

Level 1

Usually the most detailed DFD. Process numbers include decimal places to indicate subprocesses of a Level 1 process. This diagram allows the end user to understand the system and process in depth. This type of diagram assists in identifying control weaknesses or inefficiencies

Level 2