Semester 1, 2021


ACF5904 – ACCOUNTING INFORMATION SYSTEMS
Semester 1, 2021

ASSIGNMENT: Individual Assignment
WEIGHT: 15%
DUE DATE: 18 April 2021

Overview:
This assignment is designed to reinforce the following skills and areas of knowledge:
 Analyse a description of a business process
 Prepare a BPMN diagram to illustrate the operation of a business process
 Prepare a UML class diagram
 Critically assess the effectiveness of internal controls within a business process
 Apply internal control and business process knowledge to suggest process design
improvements.

Mapping Assessment Task to Course Objectives:
Objective Included How
 Understand the use of information systems for
business and analyse and make recommendations
on the utilisation and design of such systems
YES
 Requires analysis of an AIS design and
suggestions for improvement in a business
context
 Interpret business process documentation
including flowcharts and data flow diagrams YES
 Requires preparation and analysis of
documentation (BPMN, UML Class
Diagram)
 Communicate with database professionals about
the design of databases YES
 Requires preparation of a database
structure model (UML Class Diagram), REA
format, and linking to business rules and
process design
 Critique computerised and manual business
processes in terms of their exposure to risk, and
suggest internal controls that address the risks
YES
 Requires assessment and critique of
current process design and typical
operational risks
 Apply critical thinking and problem solving to
activities dealing with accounting information
systems.
YES
 Requires critical assessment of process
design and the synthesis and integration of
information from multiple sources


ACF5904 Individual Assignment 2
Semester 1, 2021
Required:
The following pages (pp. 5-8) contain a description of a business process. Based on the process
description you are required to:
1. BPMN PREPARATION (10 + 10 = 20 marks)
Prepare a BPMN diagram for each of the following processes
a. In store sales
b. Wholesale sales
2. UML CLASS DIAGRAM (7 ½ + 2 ½ = 10 marks)
a. Prepare a UML Class Diagram for the purchase and payment for inventory process.
The diagram should be set out in the REA format.
b. Based on your understanding of the purchase and payment process
i. identify one (1) weakness in its current design and operation,
ii. briefly explain why you believe this is a problem and provide a possible
negative consequence of the problem.
3. PROCESS ANALYSIS AND CRITIQUE ( 2 x (4 x 2 ½) = 20 marks)
During your interviews with the people at Z Cheddr, you recall how there were several
mentions of the business growing over recent years. Your notes from the interview with
Mr Z mentioned that he:
is a good business man and knows a lot about selling wine and cheese.
Unfortunately, Z’s accounting knowledge is marginal. His systems did not keep
up with the growth of his business. (notes from meeting with Mr. Z)
Based on these observations, you have suggested that Z Cheddr’s business processes
could benefit from an analysis and assessment of their operational effectiveness. Mr Z
liked this idea and has asked you to assess the overall ability of the process to
adequately address the following process risks
Instore sales and Wholesale sales
i. Selling to customers who cannot pay for goods
ii. Selling inventory that is not in stock / not available
iii. Sending incorrect goods to the customer
iv. Cash Receipts from sales being stolen

For each of the risks you should (i) briefly assess (High/Medium/Low) how well the current
process design addresses the risk and (ii) explain the reasoning for your assessment. If your
assessment is High (i.e. the risk is well addressed) you should explain why you think this is
so. If the assessment is medium/low you should explain your concerns and suggest
improvements that would improve the assessment.

The table on page 4 can be used to present your analysis.

ACF5904 Individual Assignment 3
Semester 1, 2021
Mark Allocations:

Question Component Marks
1 A 10 B 10
2 10
3 20
TOTAL MARKS 50

Assignment Requirements:

Question Criteria
1  Diagram correctly uses BPMN symbols
 Pools and lanes are correctly applied
 All relevant parties in a process are identified
 Diagram shows the allocation of responsibilities across different
people in the organisation
 Diagram is consistent with the details in the case interview notes
 Boundary/scope of a process is correctly identified/represented
 Diagram is logically presented and easy to follow
2  Relevant classes identified
 Relationships correctly specified and consistent with current
business rules / operations
 Multiplicities correctly specified and consistent with current
business rules and operations
 Diagram is in REA format
 Understanding of purchases-payments process
3  Risk assessment is consistent with process design
 Explanation is consistent with risk assessment
 Explanation demonstrates awareness of process design issues
 Explanation shows an application of process objectives when
considering risks
 Clarity of expression and discussion is relevant to case material and
question



Semester 1, 2021

ANALYSIS OF PROCESS DESIGN AND RISKS – SALES PROCESS
Process Operational Risk Assessment* Explanation
Instore
Sales
Selling to customers who
cannot pay for goods

H / M / L

Selling inventory that is not in
stock / not available

H / M / L

Sending incorrect goods to the
customer

H / M / L

Cash Receipts from customers
being stolen

H / M / L

Wholesale
Sales
Selling to customers who
cannot pay for goods

H / M / L

Taking orders for inventory
that is not in stock /
unavailable

H / M / L

Sending incorrect goods to the
customer

H / M / L

Cash Receipts from customers
being stolen

H / M / L

*H – HIGH – There are controls in place that address the risk and there is a high degree of confidence that controls are operating effectively
M – MEDIUM – Small deficiencies / missing controls or controls are present but their design and execution means they may not be reliable
L – LOW – There are minimal to no controls in place to deal with the specified risk
ACF5904 Individual Assignment 5
Semester 1, 2021
Overview
The following interviews were conducted prior to the start of the project to explore specific aspects
of Z Cheddr’s business processes. The interviews with employees provide information that is
representative of activities performed by all employees with the same titles. For example, the
interview with Gordon, manager of the Bend store, provides information about the activities that all
store managers perform. It is not suggested that these interviews provide complete information
about all of Z Cheddr’s business processes. They are meant to provide an initial overview of the
business.
Summary of Interview with Mr. Z
Western Oregon’s mild climate and abundant rainfall contribute to the state’s allure for dairy
farmers. Mr. Z routinely said, “We have more green grass longer than any state in the country.”
What’s more, land prices and living costs are relatively low in Oregon, luring a number of
cheesemakers from neighboring California. Many new cheesemakers are also attracted by the cross-
marketing potential of locating in Oregon wine country. Those were some of the reasons that he
started Z Cheddr just over 10 years ago. His business quickly grew from one store to 10 stores plus
an internet presence. Recently, he also started selling some cheeses on a wholesale basis to small
groceries and other cheese and wine shops on the west coast.
Mr. Z is the sole owner of Z Cheddr and operates his business as a limited liability corporation. He
has a small board of directors, including his daughter and her husband, but they are seldom involved
in any real business decisions. Mr. Z is a good businessman and knows a lot about selling wine and
cheese. Unfortunately, Z’s accounting knowledge is marginal. His systems did not keep up with the
growth of his business. He currently relies heavily on manual processes, and his data is spread
among several different systems and EXCEL spreadsheets. He plans to expand his business to other
west coast states to take advantage of the rapid growth in artisan cheese, wine, and beer makers.
So, in addition to providing financial information about his current performance, he wants advice on
the risks his business faces and cloud based accounting system where each store submits
transactions daily via the internet.
He also sells cheeses and cheese and wine gift baskets over the internet. His website looks good, but
the backend processes require heavy manual intervention. After a customer places an order and
pays by credit card, his employees must print the orders and move to another system to update
inventory, prepare shipping documents, and record the sales. He knows that this can be streamlined,
so he also wants an overall evaluation of how he can use information technology to streamline his
online process. Of course, he also wants to know how those changes would affect his internal
control system.
Summary of interview with Gordon Lightfoot, manager of the Bend store
Gordon has been the manager of the Bend, Oregon store since it opened in 2005. He has made a
number of friends among the regular customers that visit the store. Gordon is known in the area for
his knowledge of cheeses and especially his knowledge of which wines to pair with which cheeses.
Each morning, Gordon opens the store, checking to make sure that the display cases are at the right
temperature, the cash drawers are ready, and the signs are set up to display the daily specials (in no
particular order). Then, Gordon or his clerks spend the day selling wine and cheese.

ACF5904 Individual Assignment 6
Semester 1, 2021
A few times a week, Gordon hosts cheese and wine tasting promotions for his customers. These
tastings have been very successful. Customers come from all over town to attend, and most leave
purchasing both the cheese and wine that they tasted. To determine which wine and cheese to
promote, Gordon checks his inventory to be sure that he has plenty on hand so that customers will
be able to buy the product after the promotion. Using the Z Cheddr promotions form, he carefully
records the amount of cheese and wine pulled from inventory for the promotion, so those items are
no longer counted as cost of goods (but rather as administrative (marketing) expense). After the
promotion, he files the promotion form until he can send it to Chad, the Z Cheddr accountant, with
the van driver.
At the end of the day, Gordon closes out the cash registers and collects the various cash drawers. He
does a final check of the display cases, making sure that all cheeses are appropriately refrigerated
overnight. He puts the drawers and the cash register tapes in the safe for the bookkeeper.
Summary of interview with Joan Baez, bookkeeper for the Bend store
Joan is the part time bookkeeper for the store. The job is perfect for her, because she just comes in
after the store closes, summarizes the daily sales for each inventory item (cheese or wine) in a
spreadsheet. She emails the spreadsheet to Chad, the Z Cheddr accountant. Then, she prepares the
cash drawers for the next morning, prepares the deposit slips, and takes the daily receipts to the
bank for deposit. All this usually takes two or three hours. She files the deposit slips until she can
send them to Chad with the van driver.
Summary of interview with Bob Dylan, cheese and wine buyer
Bob recently graduated from Oregon State University, where he worked with other food science
students at the O.S Creamery. They learned about cheese making by making and selling cheese,
especially their famous Beaver Classic cheese. He uses his knowledge of artisan cheese making and
his connections with other cheese makers to select the best cheeses to sell at Z Cheddr. Bob
negotiated contracts with each of the cheese, so all he has to do is call them to place an order.
Each day, Bob reviews the Z Cheddr inventory records to determine what to order. He considers
recent sales trends and potential seasonal demand for particular products. He sometimes checks the
physical warehouse inventory and calls stores to verify inventory levels, since he is not completely
confident in the electronic records. He then calls the suppliers to place the orders. The suppliers
deliver their products to the Z Cheddr central warehouse in Eugene Oregon. Occasionally, Bob will
arrange for a van to pick up the order if it looks like shipment might be delayed. After the products
are received and accepted in Eugene, Bob authorizes the payment and sends a copy of the supplier’s
invoice to Chad. Chad pays each cheese maker at the end of the month in which the cheese is
received. Sometimes, he will combine payments if there is more than one shipment from the same
cheese maker during the month.
Recently, Bob has also assumed the duties of wine buyer. The wine buying process is identical to the
cheese buying process. It requires a good relationship with the suppliers and knowledge of the
products offered by each supplier. Bob has a good rapport with his suppliers, but he makes them
compete for our business. This helps keep costs down and allows Z Cheddr to provide high quality
wines for reasonable prices to our customers.
Summary of interview with Chad Mitchell, accountant
Chad has been with Josh (Mr. Z) since the beginning. He used to work in the Bend store while he
finished school, but when Mr. Z needed someone to do the accounting, Chad volunteered. Chad’s
ACF5904 Individual Assignment 7
Semester 1, 2021
job is to pay the bills, update the inventory records, put together the financial records, make sure Z
Cheddr pays its taxes on time, and keep Mr. Z informed about company performance. Chad gets the
sales and promotions information from the stores via the van drivers. He gets transfers, wholesale
and internet sales information from shipping and receiving. That way, he can maintain up to date
inventory counts and record sales daily. Z Cheddr conducts physical inventory counts each quarter,
and Chad uses those counts to update or correct the electronic inventory records. Chad uses average
inventory cost to value transfers, promotions, and ending inventory. The beginning inventory is
valued at the average cost for the previous quarter (beginning inventory cost).
Chad also pays all the bills. His clerk assembles the invoices and recurring payment information for
both inventory purchases and administrative purchases and prepares the checks. The administrative
purchases include recurring payments for rent of Z Cheddr retail stores, all of which are rented
through one broker, Oregon Commercial Real Estate. Then Chad reviews the support material,
corrects any errors, and signs the checks.
Chad also gets the timesheets from each store at the end of the month and with his assistant enters
that payroll information on the payroll services’ website. Each employee then receives a monthly
check from the payroll service. Chad transfers money from the main operating account to the payroll
account to cover the payroll each month. Chad sends checks for federal and state payroll taxes,
social security (FICA) and Medicare (MC) withholding, including the matching employer amounts for
FICA and MC, to appropriate tax authorities each quarter. Oregon has no sales tax, so he doesn’t
have to make those tax payments.
Chad and his assistant are also responsible for bank reconciliations each month. They use the
deposit slips received from the stores to confirm deposits. Additionally, deposits include the internet
credit card receipts and payments from the wholesale customers. Z Cheddr uses their bank’s
merchant services to process customers’ credit card payments. Credit card payment information is
transferred electronically from the website to the bank’s site. The bank takes their cut, which can
range from 3 to 6% of the sale amounts, depending on the credit card the customer uses. It then
electronically deposits the rest of the payment in the Z Cheddr account and sends an email to Chad
to confirm the deposit. Of course, Chad uses the Z Cheddr check book (and any transfer vouchers for
transfers to the payroll account) to confirm payments.
Lately, Mr. Z has been more and more frustrated because Chad is too busy to give him any timely
information on how the business is really doing. Chad barely has time to put together quarterly
financials, let alone monthly comparisons to the budget. He is stretched way too thin and needs a
better accounting system to take some of the load.
Summary of interview with Judy Collins, Shipping and Receiving clerk at Central Warehouse
Judy’s job is not easy, although she has help from several part time clerks. She records the incoming
shipments from our cheese and wine suppliers in Oregon. She checks each shipment for damage,
and in those rare situations where there is damage, she returns damaged items to the suppliers. She
updates the invoices/delivery slips and sends those to Bob (the buyer), so Bob knows what has been
received and can check that against what he ordered. Judy also updates the inventory records based
on the items received and accepted. She and her clerks then store the items in the warehouse.
Each day, Judy also prints the list of internet orders and pulls those items from inventory. She packs
the products for delivery sets them aside for pickup by UPS. UPS handles all the outgoing shipments
for our internet sales. UPS bills Z Cheddr monthly for shipping costs, but so far, the flat rate $9.95
shipping charges that the customers pay have covered the shipping costs.
ACF5904 Individual Assignment 8
Semester 1, 2021
Additionally, she packs the Z Cheddr vans that deliver to our ten stores around the state. Sometimes,
she even drives the vans. She prepares the transfer lists for each store, and a clerk at the store
confirms the deliveries. Then, she or one of the other van drivers brings the transfer sheets, along
with any promotion forms and deposit slips sent from the stores, back to Chad, so he can update the
inventory and accounting records. She also uses the company credit card to get gasoline for the vans
or pay for repairs and maintenance. She sends the credit card slips to Chad so he can confirm the
bills from the credit card company.
Finally, Judy also takes orders from the wholesale customers, small grocers located in Oregon. After
taking the order, she helps packs the vans and prepares an invoice. She sends the invoice with the
delivery and the wholesale customers typically pay at the end of the month.
Summary of interview with Bobby Darin, Van Driver at Central Warehouse
Bobby is on the road most of the week. He helps Judy pack his van and then hits the road to deliver
cheese and wine to the retail stores as well as to wholesale customers. He helps prepare the transfer
list for the transfers to the retail stores. Then, he gets the manager or an employee at the retail store
to confirm the transfer. When he gets back to the warehouse, he gives all the transfer forms to Chad
(or puts them in his mailbox when he is not available).
Bobby also delivers to the wholesale customers. He usually combines trips to avoid unnecessary
driving. The wholesale customers confirm receipt on a copy of the delivery document, and he gives
them an invoice at that time. He brings those confirmed delivery documents back to the warehouse
and again gives them to Chad.
Summary of interview with Cameron Cody, Vice President
Cameron is an old friend of Mr. Z. He was recently hired to run the business while Mr. Z pursued
expansion plans. While familiarizing himself with the business, he became concerned about
inadequate systems and lax internal controls. So, his focus is on selecting a new system and
improving controls.





























































































































































































































































































































































学霸联盟