2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 1
Systems Techniques and Documentation
Chapter 2
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 2
Overview
Systems techniques are tools used in the analysis, design, and documentation of system and subsystem relationships.
They are largely graphical (pictorial) in nature.
Systems techniques are used by accountants who do systems work.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 3
Learning Objectives
1 Characterize the use of systems techniques by auditors and systems development personnel.
2 Describe the use of flowcharting techniques in the analysis of information processing systems.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 4
Learning Objectives
3 Define common systems techniques, such as HIPO charts, systems flowcharts, and logical data flow diagrams.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 5
Learning Objective 1
Characterize the use of systems techniques by auditors and systems
development personnel.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 6
Use of Systems Techniquesin Auditing
What are the two basic components of an auditing engagement?
1 The interim audit which usually requires some type of compliance testing.
2 The financial statement audit which involves substantive testing.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 7
Internal Control Evaluation
Auditors are typically concerned with the flow of processing and distribution of documents within an application system.
Auditors need techniques that systematically structure the system under study.
Auditors use charts to analyze the distribution of documents in a system.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 8
Compliance Testing
Auditors undertake compliance testing to confirm the existence, assess the effectiveness, and check the continuity of operation of internal controls on which reliance is to be placed.
Compliance testing requires an understanding of the controls that are to be tested.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 9
Compliance Testing
Auditors must have a basic understanding of systems techniques used in systems analysis and design.
What are some of these techniques?– input-process-output (IPO)– hierarchy plus input-process-output (HIPO)– logical data flow diagrams (DFD)
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 10
Working Papers
What are working papers? They are the records kept by an auditor of
the procedures and tests applied, the information obtained, and conclusions drawn during an audit engagement.
The auditor is required by professional standards to maintain working papers.
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Working Papers
What are some of the systems techniques used by auditors to document and analyze the content of working papers?
– internal control questionnaires– analytic flowcharts – systems flowcharts– branching and decision tables
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 12
Use of Systems Techniques in Systems Development
What are the three phases of a systems development project?
1 Systems analysis2 Systems design3 Systems implementation
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Systems Analysis
Systems analysis involves collecting and organizing facts.
Systems techniques assist the analyst in performing these tasks.
What are some of these techniques?– matrix techniques– logical data flow diagrams
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 14
Systems Implementation
Systems implementation involves the actual carrying out of the design plan.
Documentation is one of the most important parts of systems implementation.
What systems techniques serve as a documentation tool?
– program flowcharts– decision tables
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Learning Objective 2
Describe the use of flowcharting techniques in the analysis of information
processing systems.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 16
Systems Techniques
What is a flowchart? A flowchart is a symbolic diagram that
shows the data flow and sequence of operations in a system.
Flowcharts are probably the most common systems technique.
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Basic Symbols
Input/Output
Process
Flowline
Annotation
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Specialized Input/Output Symbols
Punched Card
On-Line Storage
Magnetic TapeMagnetic Disk
Punched Tape
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Specialized Input/Output Symbols
Document
Manual Input
Display
CommunicationLink
Off-Line Storage
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Specialized Process Symbols
Decision
PredefinedProcess
Preparation
ManualOperation
AuxiliaryOperation
Merge
Extract
Sort
Collate
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Additional Symbols
Connector
Off-page Connector
Terminal
Parallel Mode
Transmittal Tape
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Symbol Use in Flowcharting
Symbols are used in a flowchart to represent the functions of an information or other type of system.
Normal direction of flow is from left to right and top to bottom.
Open arrowheads should be used on reverse-direction flowlines
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Symbol Use in Flowcharting
InvoiceInvoiceReview
andApprove
Reviewand
Approve
ApprovedInvoice
ApprovedInvoice
Normal Direction of Flow
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 24
Symbol Use in Flowcharting
InvoiceInvoiceReview
andApprove
Reviewand
Approve
ApprovedInvoice
ApprovedInvoice
Reverse Flow Shown with Arrowheads
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Symbol Use in Flowcharting
Use of Connector Symbol
RequisitionRequisition
RequisitionRequisition
PurchasingStores
A
A
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Symbol Use in Flowcharting
RequisitionRequisition
PurchaseOrder
PurchaseOrder
VendorFiles
VendorFiles
Bidirectional Flow Shown with Arrowheads
Prepare Purchase Order
and Update Vendor Files
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 27
Learning Objective 3
Define common systems techniques, such as HIPO
charts, systems flowcharts, and logical data flow
diagrams.
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IPO and HIPO Charts
These charts are used primarily by systems development personnel.
At the most general level of analysis only the basic input-process-output relations in a system are of concern.
Additional processing detail is provided by hierarchy plus input-process-output.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 29
IPO Chart
Payroll job record
Payroll master file
Accumulate hours worked
Find correct pay rate
Compute gross pay
Gross pay records
Payroll master file
Error messages
Author: Mr. Foxx
Chart Number: 3.1
System: Payroll
Description: Calculate Gross Pay Date: 6/9/0X
Input Process Output
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 30
Hierarchy Chart
Payroll SystemPayroll System
Data PreparationData Preparation ProcessingProcessing ReviewReview
1.0
2.0 3.0 4.0
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Hierarchy Chart
Calculate Gross PayCalculate Gross Pay
Calculate Net PayCalculate Net Pay
Accumulate Hours Worked
Accumulate Hours Worked
Find Correct Pay Rate
Find Correct Pay Rate
Compute Gross PayCompute Gross Pay
3.1 3.2
3.11 3.12 3.13
Each numbered module would be detailed in an IPO chart.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 32
Systems and Program Flowcharts
A systems flowchart identifies the overall or broad flow of operations in a system.
The focus of systems flowcharting concerns media and processing functions rather than the detailed logic of individual processing functions.
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Logical Data FlowDiagram Symbols
Terminator
Process
Data Store
Data Flow
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Data Flow Diagram
TimekeepingTimekeepingProcessPayroll
Data
ProcessPayroll
DataEmployeesEmployees
Payroll Data
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Data Flow Diagram
TimekeepingTimekeeping
VerifyPayroll
DataP1
VerifyPayroll
DataP1
Employee Data
Payroll Data
Current Status
Data Valid
Valid Payroll Data
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Data Flow Diagram
Employee Data
Valid Payroll Data
CalculatePay
P2
CalculatePay
P2
Data to Process EmployeesEmployeesPaychecks
Net Pay and Deductions
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Data Flow Diagram
EmployeesEmployeesComputeNet PayComputeNet Pay
Net Pay and Deductions
Paychecks
UpdateEmployee
Files
UpdateEmployee
Files
ProcessPayrollJournal
ProcessPayrollJournal
Current
Amounts
Details JournalData
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 38
Analytic, Document, and Forms Distribution Flowcharts
An analytic flowchart identifies all significant processing in an application, emphasizing processing tasks that apply controls.
In an analytic flowchart the flow of processing is depicted using symbols connected with flowlines.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 39
Analytic, Document, and Forms Distribution Flowcharts
A document flowchart is similar in format to an analytic flowchart but contains less detail about the processing functions of each entity shown on the chart.
The only symbol used in a document flowchart is the document symbol.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 40
Analytic, Document, and Forms Distribution Flowcharts
The forms distribution chart illustrates the distribution of multiple copy forms with an organization.
The emphasis is on who gets what forms rather than on how these forms are processed.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 41
Analytic Flowchart
ApproveVendor
List
ApproveVendor
List
PrepareQuotation
PrepareQuotation
SelectVendors
SelectVendors
Requestfor
Quotation
Requestfor
Quotation
Requestfor
Quotation
Requestfor
Quotation
Purchasing Suppliers Purchasing Suppliers
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Analytic Flowchart
PreparePurchase
Order
PreparePurchase
Order
SelectBid
SelectBid
QuotationsQuotations
Purchasing Suppliers Purchasing Suppliers
QuotationsQuotations
PurchaseOrder
PurchaseOrder
PurchaseOrder
PurchaseOrder
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Document Flowchart
Controller Vice President Manufacturing
PurchaseRequisition
2
PurchaseRequisition
2
Accounts Payable Purchasing Agent Receiving Stores
2
PurchaseRequisition
1
PurchaseRequisition
1
PurchaseRequisition
1
PurchaseRequisition
1
PurchaseOrder
3
PurchaseOrder
3Purchase
Order 1
PurchaseOrder
12
34 5
PurchaseOrder
4
PurchaseOrder
4
PurchaseOrder
5
PurchaseOrder
5
To Vendor
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Forms Distribution Chart
Purchasing Inventory Payables Production AccountingPurchaseOrder Copy
1
2
3
4
5
1
2
1
2
3
4
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Sandwich Rule
Every process symbol should be “sandwiched” between an input and an output symbol.
Inputs flow into a process symbol and outputs flow out of the process symbol.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 46
Narrative Techniques
Narrative techniques are useful in the fact-finding stage of system analysis.
What are some examples of narrative techniques?
– open-ended and closed-ended questionnaires
– document reviews
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Resource Utilization Analysis
Resource utilization analysis must always be considered by systems development personnel in implementing systems.
Work measurement includes the variety of techniques used to model, measure, or estimate clerical or other activities in a production framework.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 48
Resource Utilization Analysis
Work measurement involves four basic steps. What are these steps?1 Identify the tasks.2 Obtain time estimates for performing the
tasks.3 Adjust these time estimates.4 Analyze requirements based on these data.
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Decision Analysis Techniques
Branching and decision tables are used primarily by systems development personnel.
A branching table is composed of a statement of the decision to be made, a list of the conditions that can occur, and the path to be followed for each condition.
2001 Prentice Hall Business Publishing, Accounting Information Systems, 8/E, Bodnar/Hopwood 2 - 50
Decision Analysis Techniques
Branching Table Formats
Code Equal to
Go toInconnector
reference
1 2 3
Inconnectorreference
4
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Decision Analysis Techniques
A decision table is a tabular representation of a decision-making process.
Decision tables incorporate multiple-decision criteria.
They are constructed on an IF-THEN premise and appear as a two-dimensional matrix in general form.
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1 2 3 ... N Condition stub Action stub
Decision Table Format
Condition EntryAction Entry
Decision Table Format
Table Title Rules
If:Then:
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Decision Table forProcessing Labor Distribution
15 Shift Bonus Hours Y – N Y15 Overtime Hours Y N Y –15 Regular Hours Y – – N
1 2 3 4
Regular Dollars x x xOvertime Dollars x xShift Dollars x xError No Shift or OT x
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End of Chapter 2
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