AIS Ch 3 Flowcharting

Documentation

Narratives, flowcharts, diagrams, and other written materials that explain how a system works

Many people learn more and learn it more quickly by studying the DFD, BPD, or flowchart of a system than by reading a narrative description of the same system. Save both time & money, add value.

All accountants should at least be able to read and understand system documentation

includes the who, what, when, where, why, and how of data entry, data processing, data storage, information output, and system controls

Narrative description

Written, step-by-step explanation of system components and how they interact

supplement documentation

Human Readable Documentation Tools

Business process diagram (BPD)

Data Flow Diagram (DFD)

Flowchart (document, system, program)

Machine readable documentation tools

XRBL

Blockchain

Business Process Diagram (BPD)

A visual way to describe the different steps or activities in a business process

do not specify how (i.e., by means of what technology) a process activity occurs

Unlike flowcharts, you do not need to show the documents as they flow through the system or show where they are stored

BPD structure/setup

usually two columns & however many rows (aka "swim lanes")

first column= employee name/departments involved

second column=activities performed by each employee/dpt

depict the major steps in a process sequentially, reading from left to right and top to bottom

Guidelines for Preparing BPDs

1. Identify and understand the business processes.

2. Ignore certain items (don't need to show where docs stored/what technology used)

3. Decide how much detail to include

4. Organize diagram (2 col, rows/swim lanes, etc)

5. Enter each business process on diagram

6. Draw rough sketch of BPD

7. Draw final copy of BPD

BPD Symbols: Circle

start/begin

BPD Symbols: bolded circle

end

BPD Symbols: rounded edge rectangle

activity in a process

brief explanation of activity inside rectangle

BPD Symbols: diamond

decision

explanation of decision inside diamond

BPD Symbols: solid arrow

shows flow of data

BPD Symbols: dotted arrow

annotation info

helps explain a process further

Data Flow Diagram (DFD)

A graphical description of the flow of data within an organization, including data sources/destinations, data flows, transformation processes, and data storage

all elements should be named descriptively, DFDs don't show timing of movement

don't show whether data stored in computer or on paper

diff levels

---level 0 DFD, Level 0 because there are zero meaningful decimal points—1.0, 2.0, etc.

---level 1 DFD process 2.0-expands process 2.0 and has one meaningful decimal place—2.1, 2.2, etc.

Guidelines for drawing a data flow diagram (DFD)

1. Understand the system

2. Ignore certain aspects of the system (Only very important error paths are included; unimportant error paths are ignored)

3. Determine system boundaries (determine what to include/exclude)

4. Develop a context diagram

5. Identify data flows

6. Group data flows (Data elements that always flow together should be grouped together and shown as one data flow until they are separated.)

7. Identify transformation processes (Place a circle wherever work is required to transform one data flow into another)

8. Group transformation processes (Transformation processes that are logically related or occur at the same time and place should be grouped together)

9. Identify all files or data stores

10. Identify all data sources and destinations

11. Name all DFD elements (active and descriptive names, update, edit, record, prepare, reconcile)

12. Subdivide the DFD (5-7+ processes on a pg? subdivide into higher then lower processes)

13. Give each process a sequential number (low to high)

14. Refine the DFD (work through it many times, top-bottom, left-right)

15. Prepare a final copy (Do not allow data flow lines to cross each other)

What to put on final copy of DFD, flowcharts, or BPD

name of preparer

date

name of the chart

on every page

DFD Symbols: Data source

The entity that produces or sends the data that is entered into a system

square

DFD Symbols: Data destination

The entity that receives data produced by a system

square

Data Flow Diagram Symbols: Data flows

curved arrow on left

DFD Symbols: Transformation processes

circle

DFD Symbols: Data stores

= two horizontal parallel lines

DFD Symbols: Internal control

triangle- yellow inside, red border

highway warning symbol

DFD: Data flow

movement of data among processes, stores, sources, and destinations

DFD: Processes

Actions that transforms data into other data or information

DFD: Data store

place or medium where system data is stored

Context diagram

Highest-level DFD (data flow diagram); a summary-level view of a system, showing the data-processing system, its input(s) and output(s), and their sources and destinations

Flowchart

analytical technique that uses a standard set of symbols to describe pictorially some aspect of an IS in a clear, concise, and logical manner

design to read top-bottom, left-right

Including all exception procedures and error routines clutters the flowchart and makes it difficult to read and understand.

Document flowcharts

Illustrate the flow of documents and data among areas of responsibility within an organization

Divide a document flowchart into columns with labels to make easier to read

Show the final disposition of all documents to prevent loose ends that leave the reader dangling.

Guidelines for preparing flowcharts

1) Understand the system

2) Identify the entities to be flowcharted

3) Organize flowchart (show where docs originate & are stored, data processes & storage & where sent, show data from database passing through process first (computer processing))

4) Clearly label all symbols

5) Page connectors (clearly number the pages and use off-page connectors to move from one page to another)

6) Draw a rough sketch of the flowchart

7) Draw a final copy of the flowchart

4 types of flowchart symbols

input/output

processing

storage

flow/miscellaneous

Flowchart symbols: document (input/output)

Flowchart symbols: multiple documents (input/output)

Flowchart symbols: electronic output (input/output)

info displayed by an electronic output

(terminal, monitor, or screen)

Flowchart symbols: electronic data entry (input/output)

ex: computer, tablet, phone, terminal

Flowchart symbols: electronic input & output device (input/output)

used together when electronic device is the same for both input & output

Flowchart symbols: computer processing (processing)

solid rectangle

change in data/info

Flowchart symbols: manual operation (processing)

upside down trapezoid

operation performed manually

Flowchart symbols: database (storage)

cylinder

Flowchart symbols: magnetic tape (storage)

data stored on magnetic tape (type of backup storage medium)

Flowchart symbols: paper document file (storage)

upside down triangle with N

letter=way to order the files

n=numerically

a=alphabetically

d=by date

Flowchart symbols: journal/ledger (storage)

parallelogram

Flowchart symbols: document/processing flow (flow/miscellaneous)

Flowchart symbols: communication link (flow/miscellaneous)

zig zag arrow

transmission of data from one geographic location to another via communication lines

Flowchart symbols: on-page connector (flow/miscellaneous)

circle

connects flows to avoid lines crossing pages

Flowchart symbols: off-page connector (flow/miscellaneous)

upside down pentagon

entry from, or exit to, another page

Flowchart symbols: terminal (flow/miscellaneous)

long oval

beg, end, or pt of interruption in a process

also represents external party

Flowchart symbols: decision (flow/miscellaneous)

diamond

Flowchart symbols: annotation (flow/miscellaneous)

sideways field goal

add clarifying/descriptive comments to a process

Internal control flowchart

Used to describe, analyze, and evaluate internal controls, including identifying system strengths, weaknesses, and inefficiencies

System flowchart

Depicts the relationships among *system input, processing, storage, and output

Program flowchart

Illustrates the sequence of logical operations performed by a computer in executing a program

A program flowchart describes the specific logic used to perform a process shown on a system flowchart

Remittance advice

a copy of the sales invoice returned with a customer's payment that indicates the invoices, statements, or other items being paid

explains what the pmt is for