Which will help you understand ERP better?

Enterprise resource planning (ERP) is the integrated management of core business

processes, often in real
time and mediated by software and technology.
A written description of a system can be wordy and difficult to follow.
Visual images can be interpreted more effectively than words.
Documentation describe how AISS operate.
It explains how the system works using:
✓ Narratives
✓ Flowcharts Diagrams
✓ Other written materials.

This information covers the 5W and 1H of data inputs, processing, and

outputs of AIS.

There is another reason why documentation is important.

Narrative description can be interpreted differently by the readers while diagrams are
considered "common language."

Accountants and systems designer can choose from several types of documentation
tools.
For this chapter, we will focus only on two; Data flow Diagrams (DFD) and
flowcharts
Why documentation is important for an Accountant?
✓ A recent survey of practitioners shows that system documentation helps
organization to understand their business processes.
✓ Accountants need to understand documentation that describes how
accounting processing takes place.

Advantages of Using Documentation Tools

✓ Accountants can use the different types of logic charts, called documentation
tools, to trace the flow of accounting data through an AIS.
✓ Documentation tools pictorially represent data paths in compact formats and
save pages of narrative description.
✓ Documentation also describes the logical flow of data within a computer
system and the procedures that employees must follow to accomplish application
tasks.

Why documentation is important?

1. Depicting how the system works.

✓ One purpose of documentation is to help explain how an AIS operates.
✓ It helps employees understand how a system works, assists accountants in
designing controls, and gives managers confidence that it will meet their information
needs.

2. Training users.
✓ Documentation also includes the user guides manuals, and similar operating
instructions that help people learn how an AIS operates.

3. Designing new systems.

✓ Documentation helps system designers develop new systems in much the same
way that blueprints help architects design Buildings.

4. Controlling system development and maintenance cost

✓ Good documentation helps system designers develop object oriented software,
that is programs that contain modular, reusable code.
✓ This object-orientation helps programmers avoid writing duplicate
programs and facilitates changes when programs must be modified later.

5. Standardizing communication with others.

✓ Documentation tools help describe an existing or proposed system in a
"common language" and help users communicate with one another about these
systems.

6. Auditing AISS.
✓ Documentation helps depict audit trails.

7. Documenting business processes.

✓ Documentation can help managers better understand the ways in which their
businesses operate what controls are involved or missing from critical organizational
activities, and how to improve core business processes.
8. Establishing accountability
✓ Documentation also includes the people responsible for business processes.
✓ This the principle of responsibility accounting.
✓ Knowing who is responsible will determine who is accountable. (authorize users.)

DOES THIS MEAN ALL ORGANIZATION DOCUMENT THEIR AIS?

Definitely NOT!

✓ Despite the many reasons why documentation is important, most organizations

document less than they should.
✓ Organizations often create or implement large AISS under tight deadlines.
✓ In such cases, the urgency to develop "a system that works" overrides the
need for "a system that is well-documented."
✓ Most IT professionals much prefer creating systems to documenting them.

Results..
Records shows:
that insufficient or deficient documentation costs organizations time and money; that
good documentation is as important as the good software it describes.

DOCUMENTATION TOOLS

Data Flow Diagrams (DFD)

✓ Graphical representation of the flow of data in an information
system. They show:
- Where data comes from
- How it flows
- The processes performed on it and
- Where it goes

Flowcharts
✓ describe the flow of documents and information between departments
or units.

Document Flowcharts
✓ describe the relationship between inputs, processing, and outputs for
a system.
Program Flowcharts
✓ describe the sequence of logical operations performed in a computer program.
Systems Flowchart
✓ describe the relationship between inputs, processing, and outputs for a system.
Business Process Diagram
✓ Diagram is a visual way to describe the different steps or activities in a business
process.

Data Flow Diagrams (DFD)

✓ A data flow diagram (DFD) graphically describes the flow of data within an
organization.
✓ It is used to:
- Document existing systems
- Plan and design new systems
✓ There is no black-and-white approach to developing a DFD.

Data Flow Diagrams (DFD) Symbols

A data flow diagram consists of four basic elements:

✓ Data sources and destinations
- Appear as rectangles
- Represent organizations or individuals that send or receive data used or
produced by the system
- An item can be both a source and a destination.

✓ Data flows
- Appears as arrows.
- It should always be labeled.
-The exception is a data flow moving into or out of a data store.
(red lines? Are the data flows)
 ✓ Transformation processes
- Appear as bubbles.
- Represent the transformation of data
- Every process must have at least one data inflow and at lease one data
outflow.
(blue bubbles are the processes)

✓ Data stores
- Represent a temporary or permanent repository of data.
*the inflows and outflows to the data store are not labeled.

Types of DFDs
Context Diagrams
✓ Summary level view of the
✓ It depicts a data processing system and the entities that are the
sources and destinations of system inputs and outputs.
✓ Highest level
Physical Data Flow Diagrams
✓ Focuses on the physical entities of organization
Logical Data Flow Diagrams
✓ Emphasizes tasks of participants
A CONTEXT DIAGRAM shows very little detail.
✓ For better understanding of the system, decomposition process is applied to the
context DFD.
✓ Decomposition is the process of presenting the higher level diagram into a more
detailed DFD.
✓ These subsequent DFDS, Physical and Logical DFD, show more particulars, such
as the detailed processes of the application, and the inputs and outputs associated with
each processing step.

Physical DFD
✓ The first level of detail is commonly called a physical data flow
diagram.
✓ A physical DFD focuses on physical entities of the system.
✓ employees involved in the system under study,
✓ the tangible documents, reports, and
✓similar hard-copy inputs and outputs that flow through the system.

Characteristics of the Physical DFD

1. Each bubble contains a number as well as a title.
The number:
- For reference
- Assist in the decomposition tasks.
2. Inputs and outputs in and the context diagram and the physical DFD must be the
same.
- This means the 2 DFDs are balance.
- Unbalanced DFDS are inconsistent and may contain errors.
3. The titles of employees in the bubbles must correspond to the titles in an official
organization chart.

Logical DFD
✓ A physical DFD illustrates which internal and external entities participate in a
given system.
-- It does not give the reader a good idea of what these participants do.
✓ A logical data flow diagrams addresses this requirement.
✓ Logical DFD’s identifies what participants do
-- Bubble indicates a task the system performs.
✓ This type of DFD help. designers decide:
✓ System resources to acquire.
✓ Activities employees must perform.
✓ How to protect and control these systems
Note; Bubbles in the logical DFD describe the processing done by the person assigned
for each function.

Decomposition
Decomposing, also known as exploding data flow diagrams, is done to create more
detailed DFD.
 Level 0 data flow diagrams Exploded into successive levels of detail (3.0 -
Process Paycheck)
 Exploded into successive levels of detail. (3.0 - process paycheck)

 Level 1 data flow diagrams

 3.1 - Compute gross pay
 3.2 - Compute pay

Guidelines for drawing DFD

1. Understand the system
2. Develop a context diagram.
3. Identify data flows.
✓ Identify all the data flows entering or leaving the system's boundary, including
where the data originate and the final destination All data flows come from and go to
either a transformation process, a data store (file) or a data source or destination
- Data flows can move in two directions. (double headed arrow.
4. Identify transformation process.
✓ Place a circle wherever work is required to transform one data flow into another.
5. Identify all files or data stores.
Correct Answer -- activity

Document Flowchart
Document flowchart traces the physical flow of documents through an organization -
i,e,. from the departments, groups, or individuals who first create them to their final
disposition.

Flowchart symbols
Guidelines for drawing Documents flowcharts.
1. Identify all the departments that create or receive the documents involved in the
system. Use vertical lines to create “swim lanes” to separate each department from
other.
2. Carefully classify the documents and activities of each department, and draw them
under their corresponding department headings.
3. Identify each copy of an accounting document with a number. If multiple-
copy documents are color coded, use a table to identify the number color
association.
4. Group data flows
- A data flow can consist of one or more pieces of datum
- Data elements that always flow together should be grouped together and shown as
one data flow.
- If the data elements do not always flow together, then they should be shown as two
separate data flows.
5. --
6. --
7. --
8. If the sequence of records in a file is important, include the letter “A” for
alphabetical, “N” for numeric, or “C” for chronological in the file symbol. As
indicated in guideline7, you can also include a note in the flowchart to make things
clearer.
9. Place the flowchart name, the date, and the preparers name on each page of the
final copy.

Data source:

Customer Banks

Answer;
System Flowcharts

 System flowchart typically depicts the electronic flow of data and processing
steps in an AIS.
 Different symbols are strung together to show data flow, including what happens
to data and where it goes.

Program flowcharts
 The program flowchart is documentation tool that shows the data flow
while writing a program.
 It allows the users to explain the process quickly as they collaborate
with others.
 It also analyze the logic behind the program to process the code of the
programming.
Business Process Diagram
A business process diagram is a visual representation of one of your core
business processes. It shows on a screen what happens as data passes from one task to
the next until it is completed.

Software Tools for Documentation

Accountants, consultants, and system developers can use a variety of software tools to
create graphical documentation of existing or proposed AIS’s. tools include;
- Microsoft office tools such as MS power point, MS Word and MS excel. (most
diagrams used in the discussion were drawn using the MS Word)
- Computer Assisted Software Engineering (CASE) Tools. (these tools automate
documentation task; drawing, modifying flowchart, drawing graphics and screen
designs, developing reports, and even generating code from documentation.)
End-user computing is the ability of non-IT employees to create computer
application of their own.
Examples include
 Employees that manipulate data with word processing, spreadsheet, database
management systems.
 These software were develop to allow users to create application for themselves.

What if?