Accounting Information Systems, 10e 21
Supp
IPP accounts
payable/ cash
disbursements
process
Payment
notice
Total of
payments
made
Total of
payments
made
ACH
FIGURE SM-13.7 Problem 1, Part b Solution—Context Diagram for Internet Payment
Platform (Accounts Payable and Cash Disbursements Processes)
22 Solutions for Chapter 13
FIGURE SM-13.8 Problem 1, Part c Solution—Physical DFD for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
Accounting Information Systems, 10e 23
P 13-1 ANS. d. Table of Entities and Activities (Annotated) for Internet Payment
Platform (Accounts Payable and Cash Disbursements Processes)
Entities
Para
Activities
Process
Supplier
2
1. Log on to IPP.
2
2. Flip PO to invoice.
IPP server
2
3. Post invoice to appreciating database.
2
4. Encrypt invoices.
IPP server
3
15. Post invoice changes to appreciating database.
AP accountant
4
16. Trigger payment process.
BEPMIS
4
20. Extract and format payments.
4
21. Generate PIF file.
Enterprise adapter
4
25. Convert PIF from IDMS to XML.
4
IPP server
4
28. Post PIF to appreciating database.
4
30. Approve PIF.
Disbursing officer
4
31. Log on to IPP.
4
32. Approve PIF.
BEPMIS
4
17. Read and display invoices due for payment
(assumed).
AP accountant
4
18. Review invoices.
4
19. Select invoices for payment.
IPP server
5
33. Generate ACH-formatted file from PIF.
3.0 Settle payments.
5
34. Encrypt ACH-formatted file.
Enterprise adapter
2
6. Translate invoices into XML.
3
9. Perform three-way match of invoice, PO, receipt.
3
10. Extract and format invoice changes.
3
12. Convert changes from IDMS to XML.
3
14. Transmit invoice changes to IPP server.
24 Solutions for Chapter 13
Entities
Para
Activities
Process
Boston Fed
5
38. Transfer ACH file to FedACH system.
Accounting Information Systems, 10e 25
FIGURE SM-13.9 Problem 1, Part e Solution—Logical DFD for Internet Payment Platform (Accounts Payable and Cash
Disbursements Processes)
26 Solutions for Chapter 13
FIGURE SM-13.10 Problem 2, Part a Solution—Systems Flowchart for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
Accounting Information Systems, 10e 27
FIGURE SM-13.10 Problem 2, Part a Solution—Systems Flowchart (continued)
28 Solutions for Chapter 13
Supplier‘s Bank
Federal Reserve Bank
FedACH System
Federal Reserve Bank of Boston
P. 1,
C
P. 1,
B
Read e-mail
Number of
payments
and dollars
in ACH file
ACH-Formatted
file
P. 1,
A
Read e-mail
Number of
payments
and dollars
in PIF
FIGURE SM-13.10 Problem 2, Part a Solution—Systems Flowchart (continued)
Accounting Information Systems, 10e 29
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Control Goals of the Information Process
Ensure
effectiveness
of
operations
Ensure
efficient
employment
of resources
(people and
computers)
Ensure
security of
resources
(cash, AP
master
data)
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
For payment inputs,
ensure:
For AP
master data,
ensure:
Recommended
control plans
A
B
IV
IC
IA
UC
UA
IV
IC
IA
UC
UA
Present controls
P-1: Match PO and
invoice
(independent
validation of
vendor invoice)
at IPP
P-1
P-1
P-1
30 Solutions for Chapter 13
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Control Goals of the Information Process
Ensure
effectiveness
of
operations
Ensure
efficient
employment
of resources
(people and
computers)
Ensure
security of
resources
(cash, AP
master
data)
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
For payment inputs,
ensure:
For AP
master data,
ensure:
Recommended
control plans
A
B
IV
IC
IA
UC
UA
IV
IC
IA
UC
UA
P-8: Select invoices
for payment
based on due
dates
P-8
P-9: Pay only open
invoices and
close invoices
upon payment
P-9
P-9
P-9
open POs and
P-7
Accounting Information Systems, 10e 31
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Control Goals of the Information Process
Ensure
effectiveness
of
operations
Ensure
efficient
employment
of resources
(people and
computers)
Ensure
security of
resources
(cash, AP
master
data)
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
For payment inputs,
ensure:
For AP
master data,
ensure:
Recommended
control plans
A
B
IV
IC
IA
UC
UA
IV
IC
IA
UC
UA
P- 10: Follow up on
open invoices at
BEPMIS
P-10
P-10
P-10
P-13: CO and DO
approval
required for
payment
P-13
P-13
P-13
Missing controls
report
P-11: Digitally sign
electronic
payments
32 Solutions for Chapter 13
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Control Goals of the Information Process
Ensure
effectiveness
of
operations
Ensure
efficient
employment
of resources
(people and
computers)
Ensure
security of
resources
(cash, AP
master
data)
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
For payment inputs,
ensure:
For AP
master data,
ensure:
Recommended
control plans
A
B
IV
IC
IA
UC
UA
IV
IC
IA
UC
UA
M-4: Programmed
edits for
formatted and
translated
payment data
M-4
M-4
M-5: Reconcile
payments made
by BEPMIS to
PIF totals
M-5
M-5
M-5
M-5
M-5
M-5
M-5
totals for
Accounting Information Systems, 10e 33
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Control Goals of the Information Process
Ensure
effectiveness
of
operations
Ensure
efficient
employment
of resources
(people and
computers)
Ensure
security of
resources
(cash, AP
master
data)
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
For payment inputs,
ensure:
For AP
master data,
ensure:
Recommended
control plans
A
B
IV
IC
IA
UC
UA
IV
IC
IA
UC
UA
M-7: Reconcile ACH
totals to PIF
totals and
approved PIF
totals
M-7
M-7
M-7
M-7
M-7
M-7
M-7
See Exhibit SM-13.2 for a complete explanation of control plans and cell entries.
FIGURE SM-13.11 Problem 2, Part b Solution (Partial)—Control Matrix for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
34 Solutions for Chapter 13
Exhibit SM-13.2 Problem 2, Part b Solution (Partial)—Explanation of Cell Entries for
Control Matrix in Figure SM-13.11
P-1: Match PO and invoice (independent validation of vendor invoice) at IPP.
Vendor invoice input validity, vendor invoice input accuracy, and vendor invoice
P-2: Cancel PO when invoice recorded at IPP.
Security of resources and vendor invoice input validity. The PO flip feature
P-3: Record invoice due dates and payment terms.
Effectiveness goals A and B: Recording of terms and due dates allows cash
discounts as appropriate (goal A) and ensures that there is sufficient cash on hand
to make those payments (goal B).
P-4: Match PO and receiving report to invoice (independent validation of vendor
invoice) at BEPMIS.
P-5: Cancel PO and receiving report when invoice is recorded at BEPMIS.
Security of resources, vendor invoice input validity, and input completeness: The
P-6: Follow up on open POs at IPP.
Effectiveness goal A, vendor invoice input completeness, and vendor invoice
update completeness: By following up on open POs (i.e., those with no matching
invoice), we can ensure that invoices are received in time to take advantage of
discounts (goal A) and are input in a timely manner (input completeness). We