Here4Beer Brewing Company: Accounting Information System Report

This report presents an Accounting Information System (AIS) analysis for Here4Beer Brewing Company, focusing on its expansion plan within the Northern Territory market. The report, developed by a group of three students, outlines the development, documentation, and analysis of a new AIS, including subsystems for inventory, production, and payroll management. The company aims to expand its distribution network and introduce a new beer, German Marzen, to the market. The report details the organization's structure, the purpose and key features of each subsystem, and addresses e-business system issues. It includes system flow narratives, data flow diagrams (DFDs), and flowcharts for each subsystem, along with internal control analyses and recommendations. The report emphasizes the importance of the sales sub-system for order confirmation and customer validation, the production sub-system for efficient resource utilization, and the payroll sub-system for employee compensation. The analysis also covers managerial decisions supported by each sub-system and addresses e-commerce security issues. The report concludes with recommendations to ensure the successful expansion of the company, providing a project plan and proposal for market expansion.

Executive Summary
This is the report of the assignment on Accounting information system (AIS) in which a
group is needed to complete a given task of development, documentation and analysis of a
system for an organization called Here4Beer Brewing company that manufactures and sells
beers in Northern Territory. In the group of three people, we have researched the market and
the industry for understanding and come up with a plan for the development of a new AIS
system which includes subsystems for inventory, production, and payroll management.
The company has a plan to expand by taking its distribution to new selected towns and
introduce a new beer, German Marzen to the territory market. The company has plans to
succeed in the expansion by establishing strong relationships with the local distributors of
beer, maintaining tight control over costs during expansion, and ensuring that products are of
high quality.
Keeping in mind these objectives, the group has analysed the case together and have come up
with recommendations for subsystems identified. They have gathered all AIS requirements
and have documented them along with the evaluation based recommendations given to ensure
successful expansion of the company.
This report contains a project plan and proposal for the expansion of the market and
recommends an AIS system as a solution to manage the expansion successfully. Thus, it is
divided into three parts that include presentation of the plan for project, requirements and
features of the AIS solution and lastly the recommendations to follow for the company during
its expansion. The report has covered three subsystems in the AIS solution that include
inventory, payroll and production.

Table of Contents
System Documentation and Analysis.................................................................................3
Organization and industry description......................................................................................3
Taghg Red......................................................................................................................................................3
Pilsner.............................................................................................................................................................3
Lager...............................................................................................................................................................3
Organizational Structure.................................................................................................................................3
Purpose and key features of each relevant part of the AIS.................................................5
Sales sub-system..........................................................................................................................5
Production sub-system................................................................................................................5
Payroll sub-system......................................................................................................................6
AIS and the main issues specific to e-business systems......................................................8
AIS sub-systems for managerial decisions.........................................................................8
Sales sub-system..........................................................................................................................8
Production sub-system..............................................................................................................10
Payroll sub-system....................................................................................................................11
System flow......................................................................................................................12
Narrative, DFD and Flow chart of the sales sub-system..........................................................12
Narrative, DFD and Flow chart of the production sub-system................................................16
Narrative, DFD and Flow chart of the payroll sub-system......................................................19
Internal Controls Analysis and Documentation, and Recommendations..........................22
Control Matrix Explanation for Production Sub-System........................................................22
Control Matrix Explanation......................................................................................................................23
Control Analysis.........................................................................................................................................24
Control Matrix Explanation for Payroll Sub-System..............................................................25
Control Matrix Explanation......................................................................................................................26
Control Analysis.........................................................................................................................................28
Control Matrix Explanation for Sales Sub-System..................................................................28
Control Matrix Explanation......................................................................................................................29
Control Analysis.........................................................................................................................................31
References.......................................................................................................................32

System Documentation and Analysis
Organization and industry description
Taghg Red
Red ale sold by the company is an Irish style ale which is produced using traditional ways
including roasted speciality malts. These malts give the beer distinguished taste and ruby-
colour blue appearance.
Pilsner
Pilsner is a clear, light and crisp beer that comes with a white foamy head. It is created as a
blend of fine malts including domestic and those imported, hops, and lager yeast with
bottom-fragmentation. The content of malts, hops, and yeast are balanced in delicate
proportions.
Lager
Lager is a relatively new product and is brewed in German Marzen style. It is a full-bodied
malted beer that combines hops imported from New Zealand, yeast strain from Europe, and
two row malted barleys from Australia. This combination has given the beer a unique warm
light amber colour and a distinguished taste. The company does not have much competition
in this category of beer as it is relatively less in availability but has demand. Thus, company
would promote this beer in new regions to increase its sales (Wang & Zeng, 2013).
Organizational Structure
The company has three people working at the managerial levels who are taking care of major
operations. These include
 Thuc Luc who would be managing bottling and shipping operations.
 Eliza Maddox and Viresh Verughese who manage the process of brewing in the
company
 Marketing and sales are managed by Tala Green

Besides these, the company had people on following profiles (Jerry, 2000):
 One bottling and shipping manager
 2 brewing managers
 Sales and marketing manager to assist Tala Green
 3 sales representative reporting to sales manager
 Bookkeeper
 Admin Clerk
 3 bottling staff and the company would hire 2 more in next 3 years
 3 shipping staff and the company would hire 2 more in next 3 years

Purpose and key features of each relevant part of the AIS
Sales sub-system
The sales sub-system plays an important role in the beer business. It accounts for total sales
made by the company in a particular month. The key feature of the sub-system is to ensure
that the order is processed appropriately and the new lead is converted into a confirmed order
and customers are provided with the order as per their taste. The sales sub-system is also
responsible to validate the existing customers and add new customers. Also, it is charges with
the responsibility of validating and maintain the stock. The sales also focuses on the proper
coordination with the brewers to ensure that every time the fresh and handcrafted beer is
supplied to the customers. Following are key purpose of the sales sub-system:
 To confirm the order of the customer.
 To identify the existing customers so that they can be given a discounted price or
loyal points.
 To ensure that payment are received from customers before confirming the order to
the brewer.
 To document the months of the highest and lowest sales which will help in grabbing
the best sales season.
 To document the highest and lowest selling beer type.
 To validate that orders are dispatched only after receiving the payment.
Production sub-system
The subsystem of production is the significant part of the brewery business as the company
makes profits through the selling of its goods. The key feature of just the sub-system of
production would be to use the appropriate raw materials to turn them into such an actual
usable product. The emphasis is on the effectiveness of maximizing its use of existing
resources with minimal waste. The manufacturing system is to blame for selecting the right
material for the commodity and choosing the right procedure (recipe). However, the

production system emphasizes on proper preparation with other divisions such as
procurement and sales to optimize the overall organizational work.
Purpose of the production subsystem
 Provide a variety of appealing liquor options for customers.
 Identify the materials needed by the buyer for the required product-To plan the
manufacturing processes in order to process the orders on time.
 Find an efficient and effective way of reducing the price of the product by diligent
equipment maintenance.
 Ensure that buyers ' food meets their standards about quality, flavor and safety.
 Document the hourly wages on the timesheet by each employee and to pass the report
to the payroll division.
 Provide employees with the requisite expertise to help them leverage the best possible
market opportunity.
Payroll sub-system
The sub-system of payroll plays a key role in a firm's overall economic growth. Employees
will be perceived being a firm's most valuable asset, and that becomes quite possible to pay
employees for their overall efforts. The payroll goal is to ensure that employees receive in
accordance with their classification and hours worked (Gracen.d). Upon receiving the
timesheet from those in the production department, the sub system will start and the
information is then checked and accepted by the supervisor for any further processing.
Employee compensation is measured using the up-to-date database information. Workplace
payroll information is also constantly updated in the workplace registry to provide a
consistent record of employee's benefits. Employee compensation slips for their fulfillment
and financial reporting are issued and passed to workers. Every week, payroll transfers are
reported as the compensation to the workers is made on the basis of the weekly hours they

make. An effective payroll department reflects an organization's commitment to its human
resources and helping build a good social image. Therefore, ensuring consistency becomes
very critical and so does clearing the dues.
Purpose of payroll Sub-system:
 Checking and checking payroll with supporting documentation such as the staff's
timetable. ensure fair payment for workers, such as salaries, rewards and bonuses.
 Management of payroll reports and additional details such as taxes, compensation
levels and absence.
 Answer director and government officials ' internal as well as external inquiries. Prop
coverage
 Answer director and state officials ' internal and external inquiries.
 Proper credit guarantee offered to people with the work and skill they have acquired.
payroll cost data to plan the funding budget.
 Filing as well as recording payroll taxes and providing legal enforcement
information.

AIS and the main issues specific to e-business systems
Besides the advantages, the use of e-commerce could lead to different challenges and
difficulties. The most common problem when using e-commerce is the security and privacy
violation issue, and there are several instances where an unknown hacker has compromised
personal details. As per the Cambridge research survey conducted by Forrester, it was
observed that 41 % of customers demanded that their data be excluded from the firm's
database because they thought that their information was being used recklessly by the
company (Fisher 2001). Viruses including Trojan codes could harm business operations and
the entire commercial system, allowing the hacker to harvest private information (Smith,
2004).
E-commerce will be here to continue and has become an effective method of operating a
business for most organizations and individuals. It should be available 24 hours per day, 7
days per week, to make most of e-commerce-based benefits. But people should use it, and by
offering them a feeling of security, this could be achieved. Therefore, when developing a
framework for the brewery business, the above issues would be ensured. In ensure that the
latest features are applied to the framework, the code will be modified from time to time.
Secure Sockets Layer (SSL) as well as Secure (SHTML) will be used to enforce
authentication to protect data by encoding the network connecting buyer as well as seller.
(Zwass 2017). To detect and defend against viruses as well as trojans, anti-virus anti-malware
technologies would be used.
AIS sub-systems for managerial decisions
Sales sub-system
Sales sub-system is very crucial for effective management of the business because It depicts
the total income of the organization coming from the purchase of the purchase of the beers. It

helps the management in making decisions related to the finance part like that of payroll.
Because payroll includes the expenses part and sales consists of the income or earning part. It
helps management in framing the earnings coming from which type of beer, type of
customers, type of location etc. Sales helps in eliminating those area where sales is below the
average level. With the increase in sales, new equipment can be purchased to lower down the
production cost and increasing the company’s revenues. Sales sub-system can eliminate
issues with respect to the payment by the customer by verifying it before sending it to the
gateway. The sub-system will eliminate the duplicacy of customer in system by verifying it
before processing the order. Also, it eliminates wastage by ensuring that only those many
beers are produced and handed over which are required by the customer. This will help in
keeping the taste intact and thereby increasing the sales of the company. It ensures that all
sales are recorded from offline or online medium and catered accordingly so that profits can
be used to reaching out to more customers.

Production sub-system
The management's position is crucial for any company as the director is also the one who
determines the business's daily decision. To make such decision makers collect information
of every business department wherein development is also one of them. Throughout most of
the companies, quality of service is one of the main goals and the output sub-system is
directly linked to customer satisfaction. The sub-system of production plays a key role in
supplying the director with data about customer requirements and needs, allowing them to
determine what to produce and how much? The director will also collect data from the
production department about either the quality and quantity of products required to make the
order. This will help the supervisor determine how many to order and which to order?
Additionally, the sub-system of output provides supervisors with details about the time it
takes, an amount of resources required and resources lost when producing the order. Using
this information, managers can optimize the manufacturing process by rostering the correct
number of employees and motivating employees to use the right quantity of goods, which can
minimize production costs.

Payroll sub-system
Payroll subs-system plays an important role in managing the salaries expenses of the
company. It represents the amount of funds which are to be allocated to the employee’s
salary. It helps in deciding bonus and other incentives of the company. The management is
able to make decisions related to the outflow of the funds. The payroll sub-system consists of
base pay and overtime pay. It can play a crucial role in finding which employee has taken
how much overtime and whether it was required. Hence, management can take a decision in
eliminating the unrequired overtime hours. Also, the company will be able to apply correct
tax deduction thereby eliminating any discrepancy in the IT returns. With the help of this sub-
system, the management will be able to estimate the working time of the employee on the
basis of number of leaves taken by the respective employee. Along with the IT returns, the
payroll sub-system ensures that all the deducted tax are submitted to the government on time.
If any discrepancy arises, then the company will have to pay for the legal irregularities. In the
given scenario, the payroll sub-system will ensure that all employees get their respective
salaries won time and credited in the account to avoid any cash fraud.

System flow
Narrative, DFD and Flow chart of the sales sub-system
In the sales diagram, the customer logs in first. The details of the customer, formatted and is
passed to the backend where it is processed and validated. The customer then proceeds to
make a purchase. Once the customer purchases a product, the system begins with verifying