Chapter 3
DOCUMENTING
ACCOUNTING
SYSTEMS
The UML Activity
Diagram
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A “map” for
understanding business
processes
Shows the sequence of
activities in the process
Two types of activity
diagrams:
 Overview
 Detailed
Two Types of
Activity Diagrams

Overview diagram
 Presents a high-level
view of the business
process
 Documents the key
events, the sequence of
these events, and the
information flows
among these events
Two Types of
Activity Diagrams

Detailed diagram
 Provides a more
detailed representation
of the activities
associated with one or
two events shown on
the overview diagram
Understanding
Overview
Activity Diagrams
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Reading an overview activity
diagram
Swimlanes – represent
agents outside the
organization and the
computer system used to
record and process AIS data.
Solid circle - represents the
start of the process. It
appears in the swimlane of
the agent (inside or outside
the organization) who
initiates the process.
Understanding
Overview
Activity Diagrams
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Reading an overview
activity diagram
Rounded rectangles –
indicate events. (Some
events were triggered by
other events earlier in the
business process rather
than by agents outside the
organization No additional
rounded rectangle was
needed to represent this
trigger.)
Continuous lines with
arrows - show the sequence
of events.
Understanding
Overview
Activity Diagrams
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
Reading an overview
activity diagram
Document symbol represents source
documents and reports.
Capital letter(s) followed
by a colon before the name
of the document represents reference to a
typical document created
during the process.
(Indicate the status of the
object below its name.)
Understanding
Overview
Activity Diagrams
Reading an overview
activity diagram
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Dotted lines with arrows -
represent the flow of
information between
events.
Dotted lines - connect
events and tables to show
how table data are created
or used by events. For
example, the dotted line to
the Sale table represents
the sale being recorded.
Bull’s-eye - represents the
end of the process.
Preparing Overview
Activity Diagrams
Preliminary Steps:
Step 1: Read the narrative
and identify key events.
Step 2: Annotate the
narrative to clearly show
event boundaries and event
names.
Preparing Overview
Activity Diagrams
Guidelines on naming
events:
a. Use broad names that
reflect the purpose of the
event .
b. Avoid names that focus on
detailed steps in the event.
Preparing Overview
Activity Diagrams
Guidelines on naming
events:
c. Be specific. Avoid names
such as “Process
information.”
Information is a general
word and does not
convey much content to
your reader. Use more
precise event names.
Preparing Overview
Activity Diagrams
Guidelines on naming
events:
d. Start event names with a
verb.
e. Do not include employee
or department names in
event names.
Preparing Overview
Activity Diagrams
Steps for Preparing the
Activity Diagram:
Step 3: Represent agents
participating in the
business process using
swimlanes.
Preparing Overview
Activity Diagrams
Guidelines for
representing people or
devices:
a. Create a swimlane for
each person or
department responsible
for various events in the
narrative.
b. Create a swimlane for
entities outside the
organization that initiate
events in the process.
Preparing Overview
Activity Diagrams
Guidelines for
representing people or
devices:
c. Create a swimlane for
the computer system.
d. Write the name of the
appropriate person or
department in the
swimlane.
Preparing Overview
Activity Diagrams
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Common errors in
representing people or
devices:
Computer systems should
be represented as a
swimlane since the
computer can perform
actions.
Documents, files, ledgers,
and binders cannot
perform any activity. Do
not set up swimlanes for
such objects.
Preparing Overview
Activity Diagrams
Steps for Preparing the
Activity Diagram:
Step 4: Diagram each
event. Show the
sequence of these
events.
Preparing Overview
Activity Diagrams
Guidelines for
documenting events and
the sequence of events:
a. Draw a solid circle to
represent the start of the
process. The solid circle is
shown in the swimlane for
the agent (inside or
outside the organization)
who initiates the process.
Preparing Overview
Activity Diagrams
Guidelines for
documenting events and
the sequence of events:
Start with the first event.
b. If the event is triggered
by an agent outside the
organization, show a
rounded rectangle for
the trigger.
Preparing Overview
Activity Diagrams
Guidelines for
documenting events and
the sequence of events:
c. Set up a rounded rectangle
for the event in the
swimlane of the person or
department within the
organization who is
responsible for the event.
Preparing Overview
Activity Diagrams
Guidelines for
documenting events and
the sequence of events:
d. If the event is triggered by
an agent outside the
organization, connect the
trigger (see Step b) to the
event with a continuous
line.
e. Otherwise, connect the
previous event to the
current event with a
continuous line.
Preparing Overview
Activity Diagrams
Guidelines for
documenting events and
the sequence of events:
Repeat Steps b through e for
each subsequent event.
f. Draw a bull’s-eye to
represent the end of the
process. Set up the bull’seye in the swimlane for the
agent performing the last
event. Connect the last
event to the bull’s-eye with
a continuous line.
Preparing Overview
Activity Diagrams
Common errors in
documenting events and
sequences of events:
a. All the events identified in
Steps 1 and 2 are not
shown on the activity
diagram.
b. Additional events not
identified in Steps 1 and 2
are shown on the activity
diagram.
c. Continuous lines connecting
events are not shown.
Preparing Overview
Activity Diagrams
Common errors in
documenting events and
sequences of events:
d. Events are labeled with
agent names. Agent
names should not be
included in event names
since agent names are
represented in swimlanes.
e. Event names are not
consistent with the names
identified in Step 2.
Preparing Overview
Activity Diagrams
Steps for Preparing the
Activity Diagram:
Step 5: Draw documents
created and used in the
business process. Show
the flow of information
from events to
documents and vice
versa.
Preparing Overview
Activity Diagrams
Guidelines for representing
documents and document
flows:
a. Draw a document symbol
below the event that
creates or modifies a
document.
Preparing Overview
Activity Diagrams
Guidelines for
representing documents
and document flows:
b. Draw dotted lines to
connect events and
documents:
 Draw a flow from an
event to a document to
show that a document is
being prepared or
modified by the event.
Preparing Overview
Activity Diagrams
Guidelines for
representing documents
and document flows:
b. Draw dotted lines to
connect events and
documents:
 Draw a dotted line from
a document to an event
to show that information
on a document is being
reviewed or used by the
event or activity.
Preparing Overview
Activity Diagrams
Guidelines for representing
documents and document
flows:
b. Draw dotted lines to connect
events and documents:
 If a document appears
multiple times in the
process, add status
information showing how
the object changes during
the process. There’s
usually no need to show a
document symbol again
unless it’s modified or
updated.
Preparing Overview
Activity Diagrams
Guidelines for
representing documents
and document flows:
c. Note that we focus on
events that use, create,
or modify documents. We
do not show the physical
transfer of objects.
Preparing Overview
Activity Diagrams
Common errors in
representing documents
and document flows:
a. Verbs are mistakenly
used in naming
documents. The dotted
lines represent
information flows. Do not
need verbs in the
document names.
Preparing Overview
Activity Diagrams
Common errors in
representing documents
and document flows:
b. Documents are not
connected to events. Make
sure all important flows
are shown. One of the
major benefits of an
activity diagram is that it
helps you understand the
flow of information in an
AIS, which is very
important in analyzing
internal control.
Preparing Overview
Activity Diagrams
Steps for Preparing the
Activity Diagram:
Step 6: Draw tables (files)
created and used in the
business process. Show
the flow of information
from events to tables
and vice versa.
Preparing Overview
Activity Diagrams
Guidelines for representing
tables and flow of
information to and from
tables:
a. Show computer tables in
the Computer column. Only
the computer system can
read or write information
from or to these tables.
b. Draw a flow from a table to
an event to represent the
fact that information in a
table is being reviewed or
used by the event.
Preparing Overview
Activity Diagrams
Guidelines for
representing tables and
flow of information to
and from tables:
c. Draw a flow from an
event to a table to show
that a record is being
created or updated by
the event or activity.
d. Include status
information to show how
the object changes
during the business
process.
Preparing Overview
Activity Diagrams
Common errors in
representing tables and
flow of information to and
from tables:
a. Tables are named with
verbs. Use nouns to label
tables.
b. Table attributes are listed
instead of table names.
Table names are a more
compact way of
representing tables on
activity diagrams. Labeling
individual attributes makes
the diagram harder to
understand.
Preparing Overview
Activity Diagrams
Common errors in
representing tables and
flow of information to and
from tables:
c. All flows between events
and tables are not
shown. As with
documents, flow of
information to and from
tables is important in
understanding accounting
systems and controls.
Include all important
flows.
Understanding Detailed
Activity Diagrams
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The symbols used in the
detailed and overview
diagrams are the same.
The major difference rounded rectangles in the
detailed diagrams
represent activities, not
events.
Understanding Detailed
Activity Diagrams

Two additional symbols
in detailed diagrams:
 a branch (diamond)
symbol - a point where
processing splits into
two or more paths.
 a UML note symbol enables reference to
more detailed
information available in
another diagram or
document.
Preparing Detailed
Activity Diagrams
Step 1: Annotate narrative
to show activities.
Highlight the verbs in the
narrative that represent
activities.
Step 2: Prepare a workflow
table. Set up a table
using a two-column
format. Identify the
business events with
which the activities are
associated.
Preparing Detailed
Activity Diagrams
Step 3: Identify necessary
detailed diagrams.
 Construct a separate
detailed diagram for each
event in the business
process
Or
 Include more than one
event in the detailed
diagram.
Preparing Detailed
Activity Diagrams
Step 4: For each detailed diagram,
perform the following substeps:
4a. Set up swimlanes for the
agents participating in the
event or events represented in
the detailed diagram.
4b. Add a rounded rectangle for
each activity in the event(s)
being documented in that
detailed diagram.
4c. Use continuous lines to show
the sequence of the activities.
Preparing Detailed
Activity Diagrams
Step 4: For each detailed
diagram, perform the
following substeps:
4d. Set up any documents
created or used by the
activities in that diagram.
4e. Use dotted lines to connect
activities and documents.
4f. Document any tables
created, modified, or used by
the activities in the diagram
in the computer column.
4g. Use dotted lines to connect
activities and tables.
KEYTERMS
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Branch
Detailed diagram
Note
Overview diagram
Swimlane
Trigger
Unified modeling
language (UML)
UML activity diagram
Workflow table