Accounting Information Systems: Platinum Manufacturing Group Information System

This report covers the expenditure process of Platinum Manufacturing Group, including a level 0 data flow diagram and internal control weaknesses. Recommendations include installing a record management system.

Running head: ACCOUNTING INFORMATION SYSTEMS 1
Accounting Information Systems:
Platinum Manufacturing Group Information System
[Student Name]
[University Name]

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ACCOUNTING INFORMATION SYSTEMS
Table of Contents
Executive summary.....................................................................................................................................3
Overview of the expenditure process...........................................................................................................4
Level 0 data flow diagram...........................................................................................................................4
Internal control weaknesses.........................................................................................................................5
Conclusion...................................................................................................................................................6
Recommendation.........................................................................................................................................6
Reference....................................................................................................................................................7

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ACCOUNTING INFORMATION SYSTEMS
Executive summary
This is a report about the platinum manufacturing company that is medium in size and mainly
deals with the manufacturing of the various electrical devices and the company has the storeroom
where they store their raw materials which is managed by the supervisor who keep track of the
stock level and when the storeroom has low stock he is able to prepare the items requisition and
send it to the purchase team, the purchase team then prepares the purchase order and sends to the
suppliers through the email, upon receiving the purchase order the suppliers prepares the order
packages and deliver them to the store where they are received by the store staffs after
recounting the items and comparing them with the packaging slip, then the storeroom staffs
sends the slip to the purchase team for reviewing and reconciliation of stock, after the delivery of
the items the supplier team send the invoice to the purchase team which makes the payments at
the end of the month. The report also covers the level 0 diagram that shows the events that takes
place in the company and the various people or entities that are involved, however it is
recommended that the company to install a record management system to facilitate good records
management , easy storage and retrieval of the desired information.

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LEVEL 0 DATA FLOW
DIAGRAM
Platinum manufacturing company
Store supervisor
Suppliers Purchase team
Store staff
Prepare requisition
Authorize items issuance
Receive payments
Deliver items
Send invoice
Receive requisition
Prepare purchase order
Email purchase order
Count items
Receive ordered items
Stamp, scan and
email packaging slip
ACCOUNTING INFORMATION SYSTEMS
Overview of the expenditure process
This is a report about the platinum company which deals with the manufacturing of electrical
equipments and it has been able to grow financially over 2 years from $1million to $3.5 million,
the company has a storeroom that is managed by the supervisor and keep record of the available
materials, to purchase the materials the purchase team receive a requisition from storeroom
supervisor who prepares items purchase order and emails to the supplier, the supplier then
supplies the items to the storeroom where they are confirmed by storeroom staffs against
packaging slip which is then stamped and emailed to purchase team for filling together with
purchase orders for reviewing of problems and to make the payments to the suppliers, the
received materials are then stored in the storeroom and then the storeroom staffs counts the items
for reconciliation with the receipts monthly, the storeroom items are then issued or removed after
the storeroom supervisor had authorized.
Level 0 data flow diagram
(O’Brien, 2010).

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ACCOUNTING INFORMATION SYSTEMS
Internal control weaknesses
Internal control weakness Impact of the
weakness
Control to mitigate the
weakness
Latest IT
developments
Lack of order receipt
system
Loss of orders
records
Implement the receipt system Implementation of
company management
system
Poor storage of packaging
slips details
Loss of important
receipts records
Implement packaging slip
system
Implementation of
company management
system
Poor analysis of
purchases by purchase
team
Loss of company
items
Implement purchase system Implementation of
company management
system
Poor reconciliation of the
purchase order and
packaging slip
Loss of money due
to wrong payments
Implement purchase system Implementation of
company management
system
Lack of inventory system Loss of inventory
records
Implement inventory system Implementation of
company management
system
Poor reconciliation of
inventories.
Loss of storeroom
items
Implement inventory system Implementation of
company management
system
Poor preparation of
purchase requisition list.
Requesting low or
more items than
required
Implement purchases system Implementation of
company management
system
Poor preparation and
storage of purchase
orders.
Loss of the purchase
orders records
Implement purchases system
(Jawadekar, 2012).

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ACCOUNTING INFORMATION SYSTEMS
Conclusion
The platinum manufacturing company is one of the major electrical manufacturing company that
deals with manufacturing of the electrical items, this company relies on the supply of items from
various suppliers where they receive items according to the purchase order that is prepared by
the purchase team, however the purchase team places the purchase order after the storeroom
supervisor prepares the requisition list for the various store items. The payment of the supplied
items is made after the items suppliers send the invoice to the purchase team.
Recommendation
Currently the company has no good means of record keeping and therefore I recommend the
installation of computerized system that will enhance better record management, including
record saving and retrieval processes.

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ACCOUNTING INFORMATION SYSTEMS
Reference
O’Brien,A.(2010).Management Information Systems,U.S.A:
McGraw-Hill Education
Jawadekar,W.(2012). Management Information System,New York:
McGraw-Hill