Strategic Information for Business and Enterprise

The report consists of the case study of the Bell Studio who are the whole sale dealer of the art supplies. The report details of weakness of the system and the risks that the organization might face with the weakness of the system.

Running head: STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
Strategic Information for Business and Enterprise
Name of Student-
Name of University-
Author’s Note

1STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
Executive Summary
The report consists of the case study of the Bell Studio who are the whole sale dealer of
the art supplies. The business consists of many working process and the working is
done through central accounting system. The organization uses a centralized working
system that deals with all the working process of the system. The Bell Studio includes
the transaction process, the management system and the reporting system that
includes purchasing of materials from different countries, the paying procedure of the
Bell Studio stating how the transaction process is carried out and the vendors are paid,
and the their procedure that is included in the system is the payroll system stating how
the payroll system of Bell Studio works and payment is made to the employees of the
Bell Studio and the management of report is done. This report details of weakness of
the system and the risks that the organization might face with the weakness of the
system.

2STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
Table of Contents
Introduction........................................................................................................................3
D F D diagram of Purchasing system and system of Cash Disbursements.....................4
D F D Diagram of Payroll System of Bell Studio...............................................................5
System Flowchart of the Purchasing System of Bell Studio.............................................6
System Flowchart of the Cash Disbursements of Bell Studio...........................................7
System Flowchart of the Payroll System in Bell Studio.....................................................8
Internal Control Weakness of the three systems and Related Risk..................................8
Conclusion.........................................................................................................................9
References.......................................................................................................................11

3STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
Introduction
As a business analyst, it is the duty to look at all the procedures that are carried
out in the organization and to improve the working process of the organization
(Korableva and Kalimullina 2016). The business analyst of Bell Studio wants to improve
the working procedure of the business and this report consists of the details of the
working procedure of the organization. The business analyst of the Bell Studio wants to
describe the working of the company to the Chief Operating Officer including the
expenditure cycle, the risks and the internal weakness of the working procedure and to
evaluate the processes of the system.
For reporting to the Chief Executing Officer, the business analyst of the Bell
Studio describes the data flow diagram of all the processes in the organization and the
system flowchart of all the procedures of the organization in this report. The report
consists of DFD of the purchasing system about how goods are purchased in this
organization, the DFD showing the cash disbursement method to pay to the suppliers
associated with the company and the DFD of the payroll system about how the
employees are salaried in the organization.
As per the business analyst of the organization, there are weakness that the
system has in the organization. As the working process is carried out through
centralized payroll system, the business analyst states many weaknesses of the
system. The weakness of the system might lead to system risks in the operations of the
system (Safari, Faraji and Majidian 2016). All the above mentioned details are stated in
this report.

4STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
D F D diagram of Purchasing system and system of Cash
Disbursements
Figure 1: D F D diagram of Purchasing system and system of Cash Disbursements
(Source: Created By author)
Description: The above diagram shows the processes and the input/output of
the processes that are carried out in the working process of the purchasing system and
the cash payment system to the suppliers. The above chart shows how order is place in
the system and after receiving the order, how the working process of the system is
carried out till the payment system of the Bell Studio. The vendors of the organization
are paid through cheques that are sent to them via email. The clerk of the cash
disbursement department then updates the total expenditure of the company in the
cheque payment register, accounts subsidiary ledger and the accounts payable
accounts. The final updates are done in the payroll central system of the company.

5STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
D F D Diagram of Payroll System of Bell Studio
Figure 2: D F D Diagram of Payroll System of Bell Studio
(Source: Created By author)
Description: The diagrams above shows the payroll system of the organization.
The payroll system including the report of managing the payment system of the
company that is paid to the employees. The employees of the company are paid
through cheques and the cheques are given by the payroll clerk of the payroll
department. The duty of the payroll department is to update the employee record in the
database and pay cheques to the employees. The files are then forwarded to the
department of accounts and the clerk there reviews the disbursement voucher. The
ledger of the system looks at the payroll register and the clerk of the payroll system
write the cheques for the entire payroll and submits to their bank account.

6STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
System Flowchart of the Purchasing System of Bell Studio
Figure 3: System Flowchart of the Purchasing System of Bell Studio
(Source: Created By author)
Description: The above diagram shows the flowchart of the purchasing of goods
system in the Bell Studio. The flowchart starts with checking of the inventory of the
company and if the quantity of the materials are low, then the clerk of the purchasing
department proceeds with other activities. The sequence of activities ate shown in the
diagram above.

7STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
System Flowchart of the Cash Disbursements of Bell Studio
Figure 4: System Flowchart of the Cash Disbursements of Bell Studio
(Source: Created By author)
Description: The above diagram shows how cash disbursement is done to pay
the vendors of the company. The cash disbursement is done by the cash disbursement
department of the company and the cheques that are paid to the vendors are sign by
the treasurer of the cash department. The cheque is given to the vendor via mail. The
central accounting system is then updated by the clerk of the cash department. After all
updates are done by the cash disbursement department, the files related to cash
disbursement are stored by the receiving clerk in the purchasing department.

8STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
System Flowchart of the Payroll System in Bell Studio
Figure 5: System Flowchart of the Payroll System in Bell Studio
(Source: Created By author)
Description: The above flowchart shows the details of the payroll system in the
Bell Studio. The Bell Studio conducts the payroll system by depositing the cheque to the
imprest account to their associated bank account. The employees of the Bell studio are
paid according to their total time of working in the office and the time is entered in the
time cards by the employees. The supervisor of the system, under whom the employees
work; reviews the time cards and forwards the time card to the payroll system. The
department of payroll system checks the time cards and update the data on the system
consisting of central payroll. The clerk of payroll department also prints cheques for the
employees and send the cheques to the supervisor for distributing them to the
employees.
The payroll register is then updated and is forwarded to the accounts department
to prepare a disbursement cheque for the total payroll. Then the cheque is submitted to
the bank.
Internal Control Weakness of the three systems and Related Risk
System Internal Control Weakness Risk Related
1. The
Purchasing
System
1. The purchasing is totally
dependent on the clerk
associated with the
1.1 The risk associated is slow
down the working process of Bell
Studio (Chen et al. 2016). If the

9STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
purchasing department
(Chalmers, Hay and Khlif
2019).
purchasing clerk is not operating,
the purchasing system will be
stopped totally.
2. Accounting system is
carried out in the system
and this includes computer
based systems in Bell
Studio (Duncan and
Whittington 2016).
2.1 System failure risk might
occur because of the power loss
or accounting information used in
the company (Ji, Lu and Qu
2017).
3. Many of the documents
are handled in file and files
are transferred from one
department to another.
3.1 Risk of staff dishonesty and
fraud risk might occur in the
system. These risks comes under
fraud risks that are expected to
occur in the system because of
internal weakness (Heeks 2017).
2. Cash
Disbursement
System
1. The cheques written for
the paying the vendor may
be wrongly written.
1.1 Human error risk is
associated with this particular
internal weakness.
2. The vendors needs to
encash the cheques from
the bank which is a long
time process (Gallemore
and Labro 2015).
2.1 The vendor might not be
satisfied as the process is a long
term process and there is a risk
of fraud in this particular system
(Kim, Lee and Park 2016).
3. Misplacing the files
containing important
documents is one of the
most common weakness
that the company might face
(Feeney and Pierce 2016).
3.1 Risk of human error with this
weakness might occur with
incorrect processing of data, or
placing the files carelessly.
3. Payroll System 1. Extra burden of
submitting a cheque of the
total payroll amount of
money and includes extra
time along with extra effort
and man power.
1.1 Risk of wasting man power
and time for conducting the
business process (Thompson
2017).
2. Mistake might occur while
making copies of document
and updating the data on
the central system from the
hard copies.
2.1 Human error risks addressed
this particular internal weakness
of the system.
3. Employees might wrongly
enter their time on the time
card and or might do it
deliberately (Hockerts
2015).
3.1 Risk of human error or staff
dishonesty.

10STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
Conclusion
Carrying out central accounting system in an organization brings many
advantages along with many disadvantages in the system. The advantages that are
related with a centralized system is that it provides the business analyst to have a clear
command chain because the process is very clear to the staffs working in the system.
The centralized system aims at having a centralized and focussed vision in the
organization. The helps to reduce the cost in an organization. But along with the
advantages, it brings a lot of disadvantages in the system. It includes a bureaucratic
leadership where only the top level managers or the clerks associated with the system
are only allowed to take decisions. The executive of an organization also comes under
high pressure for taking decision for the company. As works are done manually, there is
a chance of delaying the work and also lacks in employee loyalty.
All the internal weakness of the system and the risks associated with the internal
weakness are described in this report. The working procedure of the system are shown
in this report describing their data flow diagram and the system flowchart diagram. This
report consists of detailed working of the system.

11STRATEGIC INFORMATION FOR BUSINESS AND ENTERPRISE
References
Chalmers, K., Hay, D. and Khlif, H., 2019. Internal control in accounting research: A
review. Journal of Accounting Literature, 42, pp.80-103.
Chen, Y., Knechel, W.R., Marisetty, V.B., Truong, C. and Veeraraghavan, M., 2016.
Board independence and internal control weakness: Evidence from SOX 404
disclosures. Auditing: A Journal of Practice & Theory, 36(2), pp.45-62.
Duncan, R.A.K. and Whittington, M., 2016. Enhancing cloud security and privacy: the
power and the weakness of the audit trail. CLOUD COMPUTING 2016.
Feeney, O. and Pierce, B., 2016. Strong structuration theory and accounting
information: an empirical study. Accounting, auditing & accountability journal, 29(7),
pp.1152-1176.
Gallemore, J. and Labro, E., 2015. The importance of the internal information
environment for tax avoidance. Journal of Accounting and Economics, 60(1), pp.149-
167.
Heeks, R., 2017. Information technology, information systems and public sector
accountability. In Information Technology in Context: Studies from the Perspective of
Developing Countries (pp. 201-219). Routledge.
Hockerts, K., 2015. How hybrid organizations turn antagonistic assets into
complementarities. California Management Review, 57(3), pp.83-106.
Ji, X.D., Lu, W. and Qu, W., 2017. Voluntary disclosure of internal control weakness and
earnings quality: Evidence from China. The International Journal of Accounting, 52(1),
pp.27-44.
Kim, J.B., Lee, J.J. and Park, J.C., 2016. Internal control weakness and the
asymmetrical behavior of selling, general, and administrative costs. General, and
Administrative Costs (December 3, 2016).
Korableva, O.N. and Kalimullina, O.V., 2016, September. Strategic approach to the
optimization of organization based on BSC-SWOT matrix. In 2016 IEEE International
Conference on Knowledge Engineering and Applications (ICKEA) (pp. 212-215). IEEE.
Safari, H., Faraji, Z. and Majidian, S., 2016. Identifying and evaluating enterprise
architecture risks using FMEA and fuzzy VIKOR. Journal of Intelligent
Manufacturing, 27(2), pp.475-486.7
Thompson, J.D., 2017. Organizations in action: Social science bases of administrative
theory. Routledge.