Accounting Information Systems, 7e
Internet Payment Platform (Accounts Payable and Cash Disbursements Processes)
Solutions (see the Note on pg. 13-5)
P13-1 ANS.
a. Table of Entities and Activities for Internet Payment Platform (Accounts
Payable and Cash Disbursements Processes)
Entities
Para
Activities
Supplier
2
1. Log on to IPP.
2
2. Flip PO to invoice.
2
3. Post invoice to appreciating database.
2
4. Send invoices to the enterprise adapter.
2
5. Translate invoices into XML.
2
6. Send translated invoices to BEPMIS (assumed).
2
7. Post invoices to accounts payable database.
3
8. Perform three-way match of invoice, PO, receipt.
3
9. Extract and format invoice changes.
3
10. Send invoice changes to enterprise adapter.
3
11. Convert changes from IDMS to XML.
3
12. Transmit invoice changes to IPP server.
IPP Server
3
13. Post invoice changes to appreciating database.
Accounts payable accountant
4
14. Trigger payment process.
BEPMIS
4
15. Read and display invoices due for payment (assumed).
Accounts payable accountant
4
16. Review invoices.
4
17. Select invoices for payment.
4
18. Extract and format payments.
4
19. Generate and digitally sign PIF file.
4
20. Transmit PIF to enterprise adapter.
4
21. Notify AP accountant of number and dollar amount of
payments.
4
22. E-mail CO, DO, and Boston Fed with PIF totals.
4
23. Convert PIF from IDMS to XML.
4
24. Transmit PIF to IPP server.
IPP Server
4
25. Post PIF to appreciating database.
Contracting officer (CO)
4
26. Log on to IPP.
IPP server
Enterprise adapter
BEPMIS
Enterprise adapter
BEPMIS
Enterprise adapter
1
Accounting Information Systems, 7e
Entities
Para
Activities
4
27. Approve PIF.
4
28. Log on to IPP.
4
29. Approve PIF.
5
30. Generate ACH-formatted file from PIF.
5
31. Send ACH-formatted file to Boston Fed.
5
32. E-mail AP accountant, CO, DO, and Boston Fed with ACH
totals (number and dollar amount of payments).
5
33. E-mail supplier that a payment is coming.
Boston Fed
5
34. Transfer ACH file to FedACH system.
FedACH system
5
35. Settle payment (debit Treasury’s account and credit supplier’s
bank’s account).
5
36. Notify supplier’s bank of credits.
5
37. Send Bulk Data Acknowledgement (number and dollar amount
of payments) to AP accountant, CO, DO, Boston Fed.
5
38. Credit supplier’s account.
Disbursing officer (DO)
IPP server
Supplier’s bank
Payment
notice
Supplier
Total of
payments
made
IPP accounts
payable/ cash
disbursements
process
ACH
totals
Total of
payments
made
ACH
totals
Accounts
payable
accountant
FIGURE SM-13.7
ACH
totals
Total of
payments
made
ACH
Total of totals
payments
made
Disbursing
officer
Boston Fed
Contracting
officer
Problem 1, part b solution—context diagram for Internet Payment
Platform (Accounts Payable and Cash Disbursements Processes)
2
Accounting Information Systems, 7e
Appreciating
database
Extracted and formatted
invoice changes
Invoice changes
in XML
Logon
PO data
1.0
Supplier
PIF file
in XML
Payment
notice
PIF file
4.0
BEPMIS
PIF
totals
PIF
approval
PO flip
Invoices
in XML
3.0
Enterprise
adapter
Invoices
2.0
IPP
server
PIF in
ACH format
PIF
approval
BEPMIS/IDMS
database
PIF
totals
7.0
Disbursing
officer
Open
invoices
ACH ACH
totals totals
ACH
totals
8.0
Boston
Fed
PIF in
ACH format
6.0
Contracting
officer
PIF totals
Total of
payments
made
Invoices
to be
paid
PIF
totals
Supplier
ACH
totals
Trigger
payment
process
5.0
Accounts
payable
accountant
9.0
FedACH
System
Treasury and
bank accounts
Boston Fed
Accounts
payable
accountant
Contracting
officer
Disbursing
officer
Total of
payments
made
Total of
payments
made
Total of payments made
FIGURE SM-13.8
Credit
notice
10.0
Supplier's
Bank
NOTE: Only one flow into and out
of the appreciating and IDMS databases
are shown to represent all interactions.
Problem 1, part c solution—physical DFD for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
Supplier
accounts
3
Accounting Information Systems, 7e
P13-1 ANS.
d. Table of Entities and Activities (Annotated) for Internet Payment
Platform (Accounts Payable and Cash Disbursements Processes)
Entities
Para
Activities
Supplier
2
1. Log on to IPP.
2
2. Flip PO to invoice.
IPP server
2
3. Post invoice to appreciating database.
Enterprise adapter
2
5. Translate invoices into XML.
BEPMIS
2
7. Post invoices to accounts payable database.
3
8. Perform three-way match of invoice, PO, receipt.
3
9. Extract and format invoice changes.
3
11. Convert changes from IDMS to XML.
3
12. Transmit invoice changes to IPP server.
IPP Server
3
13. Post invoice changes to appreciating database.
AP accountant
4
14. Trigger payment process.
BEPMIS
4
15. Read and display invoices due for payment
(assumed).
AP accountant
4
16. Review invoices.
4
17. Select invoices for payment.
4
18. Extract and format payments.
4
19. Generate and digitally sign PIF file.
Enterprise adapter
4
23. Convert PIF from IDMS to XML.
IPP Server
4
25. Post PIF to appreciating database.
Contracting officer
(CO)
4
26. Log on to IPP.
4
27. Approve PIF.
4
28. Log on to IPP.
4
29. Approve PIF.
IPP server
5
30. Generate ACH-formatted file from PIF.
Boston Fed
5
34. Transfer ACH file to FedACH system.
FedACH system
5
35. Settle payment (debit Treasury’s account and
credit supplier’s bank’s account).
Supplier’s bank
5
38. Credit supplier’s account.
Enterprise adapter
BEPMIS
Disbursing officer
(DO)
Process
1.0 Record Invoices
and invoice changes
2.0 Select and
approve payments
3.0 Settle payments
4
Accounting Information Systems, 7e
Supplier
Payment
notice
Treasury and
bank accounts
ACH totals
Total of
payments made
Appreciating
database
1.0
Record
invoices and
invoice
changes
Accounts
payable
accountant
ACH total
3.0
Settle
payments
Total of
payments made
Boston Fed
ACH total
Total of
payments made
Accounts payable
database
2.0
Select and
approve
payments
ACH total
Total of
payments made
Supplier
accounts
FIGURE SM-13.9
Disbursing
officer
Problem 1, part e solution—logical DFD for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
Contracting
officer
5
Accounting Information Systems, 7e
Supplier
Start
Log onto IPP,
request PO flip
Bureau of Engraving and Printing (BEP)
IPP Server at Xign
Enterprise Adapter
(Intel Server)
BEPM IS/CAS (IBM M ainframe)
Flip PO (create and
record invoice),
send invoice to BEP
Translate invoice
data from XM L,
transmit to BEPM IS
Perform three-way
match with PO and
receipt, record
invoice
IPP
Appreciating
database
Translate invoice
status change into
XM L, transmit to IPP
server
Extract and format
invoice status
change, transmit to
IPP
Once goods (or
services) have
been delivered)
PO flip
display
Record invoice
status changes
FIGURE SM-13.10 Problem 2, part a solution—systems flowchart for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
IDM S
database
6
Accounting Information Systems, 7e
Disbursing officer
(DO) at FM S RFC
Bureau of Engraving and Printing (BEP)
AP
Accountant
Contracting
officer (CO)
BEPM IS/CAS
(IBM M ainframe)
Record
payments
Start
Trigger
payment
process
IPP Server at Xign
Enterprise Adapter
(Intel Server)
Record
payments
Includes display of
invoices due and
selection of those to
be paid
A
Record CO
approval
IDM S
database
Record DO
approval
Extract IPP payments,
format, digitally sign,
transmit PIF to IPP
Number of
payments
and dollars
in PIF
Number of
payments
and dollars
in PIF
B
Daily batch
job
Payments
made
Enter
E-mail to CO,
DO, and Fed
Send E-mail to
CO, DO, and Fed
Number of
payments
and dollars
in PIF
Generate
ACH-formatted file,
send to Boston Fed
Only after DO and
CO approvals
Translate payment
data to XM L, transmit
to IPP server
Number of
payments
and dollars
in PIF
P. 2,
A
Log on
to IPP,
approve PIF
Approval
display
A
Optional auditor
approval
Log on
to IPP,
approve PIF
Approval
display
Number of
payments
and dollars
in ACH file
C
P.2,
B
Send E-mail to AP,
CO, DO, Boston
Fed, and supplier
P.2,
C
Supplier
B
C
Number of
payments
and dollars
in ACH file
IPP
Appreciating
database
C
Number of
payments
and dollars
in ACH file
FIGURE SM-13.10 Problem 2, part a solution—systems flowchart (continued)
E-mail notice
that payment
is coming
7
Accounting Information Systems, 7e
Federal Reserve Bank
Supplier's Bank
FedACH System
Federal Reserve Bank of Boston
P. 1,
A
P. 1,
C
Read e-mail
Read e-mail
P. 1,
B
ACH-Form atted
file
Number of
payments
and dollars
in PIF
Number of
payments
and dollars
in ACH file
Initiate
transfer of
ACH file
Transfer
ACH-formatted
file to FedACH
Credit
supplier's
account
Settle the
payment
Send Bulk Data
Acknowledgement to
AP, CO, DO, Boston
Fed
Manual intervention is
needed to send ACH file
through several servers
and links to FedACH
Bulk Data
Acknow ledgem ent
includes num ber of
paym ents and dollars
paid
Number of
payments
and dollars
paid
AP
FIGURE SM-13.10 Problem 2, part a solution—systems flowchart (continued)
CO
DO
8
Accounting Information Systems, 7e
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Ensure
effectiveness
of
operations:
Recommended
control plans
A
Ensure
efficient
employment
of resources
(people,
computers)
Ensure
security of
resources
(cash, AP
master
data)
B
Control Goals of the Information Process
For vendor invoice
inputs, ensure:
IV
IC
IA
For AP master
data, ensure:
UC
UA
Present Controls
P-1: Match PO and
invoice
(independent
validation of
vendor invoice)
at IPP
P-1
P-1
P-2: Cancel PO when
invoice recorded
at IPP
P-2
P-2
P-4
P-4
P-3: Record invoice
due dates and
payment terms
P-4: Match PO and
receiving report
to invoice
(independent
validation of
vendor invoice)
at BEPMIS
P-3
P-1
P-1
P-4
P-4
P-3
For payment inputs,
ensure:
IV
IC
IA
For AP
master data,
ensure:
UC
UA
9
Accounting Information Systems, 7e
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Ensure
effectiveness
of
operations:
Recommended
control plans
A
P-5: Cancel PO and
receiving report
when invoice
recorded at
BEPMIS
Ensure
efficient
employment
of resources
(people,
computers)
Ensure
security of
resources
(cash, AP
master
data)
B
Control Goals of the Information Process
For vendor invoice
inputs, ensure:
IV
P-5
IC
IA
For AP master
data, ensure:
UC
P-6
P-6
P-6
P-7: Follow up on
open POs and
receiving reports
at BEPMIS
P-7
P-7
P-7
P-8: Select invoices
for payment
based on due
dates
P-8
P-9
IV
P-5
P-6: Follow-up on
open POs at IPP
P-9: Pay only open
invoices and
close invoices on
payment
(independent
authorization to
make payment)
at BEPMIS
UA
For payment inputs,
ensure:
P-9
IC
IA
For AP
master data,
ensure:
UC
UA
10
Accounting Information Systems, 7e
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Ensure
effectiveness
of
operations:
Recommended
control plans
P- 10: Follow-up on
open invoices at
BEPMIS
A
P-13: CO and DO
approval
required for
payment
Ensure
security of
resources
(cash, AP
master
data)
B
For vendor invoice
inputs, ensure:
IV
IC
IA
For AP master
data, ensure:
UC
UA
IV
IC
IA
P-10
P-11
P-11
P-12
P-11
P-13
P-13
M-1
M-1
M-1
M-1
For AP
master data,
ensure:
UC
UA
P-10
P-11
P-12
Missing Controls
M-1: Independent
validation of
vendor invoice
at IPP does not
include match
to receiving
report
For payment inputs,
ensure:
P-10
P-11: Digitally sign
electronic
payments
P-12: Follow-up on
open invoices at
IPP
Ensure
efficient
employment
of resources
(people,
computers)
Control Goals of the Information Process
P-11
P-12
P-13
P-11
11
Accounting Information Systems, 7e
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Ensure
effectiveness
of
operations:
Recommended
control plans
M-2: Reconcile batch
totals for
invoices and
changes
A
Ensure
efficient
employment
of resources
(people,
computers)
Ensure
security of
resources
(cash, AP
master
data)
B
M-2
M-2
M-3: Programmed
edits for
translated and
formatted
invoice (and
invoice change)
data
Control Goals of the Information Process
For vendor invoice
inputs, ensure:
For AP master
data, ensure:
IV
IC
IA
UC
UA
M-2
M-2
M-2
M-2
M-2
M-3
For payment inputs,
ensure:
IV
IC
IA
For AP
master data,
ensure:
UC
UA
M-3
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
M-6: Reconcile
approved
payments to PIF
totals
M-6
M-6
M-6
M-6
M-6
M-6
M-6
12
Accounting Information Systems, 7e
Control Goals of the IPP Accounts Payable and Cash Disbursements Processes
Control Goals of the Operations Process
Ensure
effectiveness
of
operations:
Recommended
control plans
A
Ensure
efficient
employment
of resources
(people,
computers)
Ensure
security of
resources
(cash, AP
master
data)
B
Control Goals of the Information Process
For vendor invoice
inputs, ensure:
IV
IC
IA
For AP master
data, ensure:
UC
UA
For payment inputs,
ensure:
For AP
master data,
ensure:
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
M-8: Reconcile
payments made
by ACH to
ACH file (and
PIF totals and
BEPMIS
payment totals)
M-8
M-8
M-8
M-8
M-8
M-8
M-8
Possible effectiveness goals include the following:
A = Optimize cash discounts.
B = Ensure that the amount of cash maintained in demand deposit accounts is sufficient
(but not excessive) to satisfy expected cash disbursements).
IV = input validity
IC = input completeness
IA = input accuracy
UC = update completeness
UA = update accuracy
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)
13
Accounting Information Systems, 7e
Exhibit SM-13.2
P-1:
14
Problem 2, part b solution (partial)—explanation of cell entries for control
matrix in Figure SM-13.11
Match PO and invoice (independent validation of vendor invoice) at IPP.
Security of resources: Because cash cannot be expended in the absence of a
validated vendor invoice, security over the cash asset is also enhanced.
Vendor invoice input validity, vendor invoice input accuracy, and vendor invoice
update accuracy: By comparing the invoice to the PO, we ensure that the
recorded invoice reflects goods actually ordered. We assume that the AP master
data is updated simultaneously with the input of the invoice data.
P-2:
Cancel PO when invoice recorded at IPP.
Security of resources and vendor invoice input validity. The PO flip feature
prevents the matching of more than one invoice for each PO, thus ensuring that
funds are not expended inappropriately (security of cash) and that invalid invoices
are not recorded.
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.
Security of resources: Because cash cannot be expended in the absence of a
validated vendor invoice, security over the cash asset is also enhanced.
Vendor invoice input validity, vendor invoice input accuracy, and vendor invoice
update accuracy: By comparing the invoice to the PO and receiving report, we
ensure that the recorded invoice reflects goods actually ordered and received. We
assume that the AP master data is updated simultaneously with the input of the
invoice data.
P-5:
Cancel PO and receiving report when invoice is recorded at BEPMIS.
Security of resources and vendor invoice input validity: The PO and receiving
report are canceled upon performing the three-way match, thus preventing the
matching of more than one invoice for each PO and receiving report. This ensures
that funds are not expended inappropriately (security of cash) and that invalid
invoices are not recorded.
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
Accounting Information Systems, 7e
15
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
assume that the PO master data is updated simultaneously with the input of the
receipt data.
P-7:
Follow up on open POs and receiving reports at BEPMIS.
Effectiveness goal A, vendor invoice input completeness, and vendor invoice
update completeness: By following up on open POs and receiving reports (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 assume that the PO master data is updated simultaneously with
the input of the receipt data.
P-8:
Select invoices for payment based on due dates.
Effectiveness goal A: Ensures that payments are made in a timely manner, not too
early and not too late (i.e., to optimize cash discounts).
P-9:
Pay only open invoices and close invoices upon payment (independent
authorization to make payment) at BEPMIS.
Security of resources: Because cash cannot be expended in the absence of a
validated, open vendor invoice (and this invoice was recorded after matching it to
the PO and receiving report), security over the cash asset is also enhanced.
Payment input validity: The accounts payable computer program approves vendor
invoices for payment. Because the invoice was recorded after matching it to the
PO and receiving report, the validity of the payment input is ensured.
P-10:
Follow up on open invoices at BEPMIS.
Effectiveness goal A, payment input completeness, and payment update
completeness: By following up on open invoices (i.e., those due for payment), we
can ensure that payments are made in time to take advantage of discounts (Goal
A) and are input in a timely manner (input completeness). We assume that the AP
master data is updated simultaneously with the input of the payment data.
P-11:
Digitally sign electronic payments.
Security of resources, payment input validity, payment input completeness,
payment input accuracy, payment update completeness, and payment update
accuracy: When the digital signatures are authenticated at IPP, they will know that
the sender has the authority to send the PIF, which prevents the unauthorized
diversion of resources (security of resources). This also determines that the PIF
itself is genuine (validity), has not been altered in transit, and thus is complete and
accurate. We assume that the AP master data is updated simultaneously with the
input of the payment data.
Accounting Information Systems, 7e
P-12:
16
Follow up on open invoices (at IPP).
Effectiveness goal A, payment input completeness, and payment update
completeness: By following up on open invoices (i.e., those due for payment), we
can ensure that payments are made in time to take advantage of discounts (Goal
A) and are input in a timely manner (input completeness). We assume that the AP
master data is updated simultaneously with the input of the payment data.
P-13:
CO and DO approval required for payment.
Security of resources, payment input validity, and payment input accuracy: A
contracting officer and a disbursing officer reviews each PIF to ensure that each
payment is authorized (validity), accurate, and is not a misuse of resources.
M-1:
Independent validation of vendor invoices at IPP does not include a match to the
receiving report.
Security of resources: Because cash cannot be expended in the absence of a
validated vendor invoice, security over the cash asset would be enhanced by
matching the invoice to goods actually received.
Vendor invoice input validity, vendor invoice input accuracy, and vendor invoice
update accuracy: By comparing the invoice to the receiving report (in addition to
the PO), we could ensure that the recorded invoice reflects goods actually
received (and ordered). We assume that the AP master data is updated
simultaneously with the input of the invoice data.
M-2:
Reconcile batch totals for invoices and invoice changes.
Efficient employment of resources: Using batch totals to reconcile the invoice data
is more efficient than reviewing each invoice.
Security of resources and vendor invoice input validity: Determining that invoice
inputs (and changes) reflect only those sent from IPP (or BEPMIS) ensures that
cash will not subsequently be disbursed inappropriately (security of resources)
and ensures the validity of the vendor invoice inputs (and changes).
Vendor invoice input completeness, vendor invoice input accuracy, vendor invoice
update completeness, and vendor invoice update accuracy: By comparing totals
received from IPP (or BEPMIS) to those produced after the update, we ensure that
all vendor invoices (or changes) were input (input completeness) and that all
vendor invoices (or changes) were input correctly (input accuracy). We assume
that the AP master data is updated simultaneously with the input of the invoice
data.
M-3:
Programmed edits for formatted and translated invoice data.
Vendor invoice input accuracy and vendor invoice update accuracy: Edits at
BEPMIS and the Enterprise Adapter would identify erroneous or suspect data and
Accounting Information Systems, 7e
17
reduce input errors at the IPP server. We assume that the AP master data is
updated simultaneously with the input of the receipt data.
M-4:
Programmed edits for formatted and translated payment data.
Payment input accuracy and payment update accuracy: Edits at BEPMIS and the
Enterprise Adapter would identify erroneous or suspect data and reduce input
errors at the IPP Server. We assume that the AP master data is updated
simultaneously with the input of the payment data.
M-5:
Reconcile payments made by BEPMIS to PIF totals.
Efficient employment of resources: Using batch totals to reconcile the payment
data is more efficient than reviewing each payment.
Security of resources, payment input validity, payment input completeness,
payment input accuracy, payment update completeness, and payment update
accuracy: By reconciling batch totals, the AP accountant can ensure that
payments sent to IPP reflect only those authorized, that cash is not disbursed
inappropriately (security of resources), that only legitimate payments are sent to
the IPP (input validity), that all data are sent (input completeness), and that all
data are input accurately. We assume that the AP master data is updated
simultaneously with the input of the payment data.
M-6:
Reconcile approved payments to PIF totals.
Efficient employment of resources: Using batch totals to reconcile the payment
data is more efficient than reviewing each payment.
Security of resources, payment input validity, payment input completeness,
payment input accuracy, payment update completeness, and payment update
accuracy: By reconciling batch totals, the CO and DO can ensure that payments
approved at IPP reflect only those authorized, that cash is not disbursed
inappropriately (security of resources), that only legitimate payments are
approved at IPP (input validity), that all data are input (input completeness), and
that all data are input accurately. We assume that the AP master data is updated
simultaneously with the input of the payment data.
M-7:
Reconcile ACH totals to PIF totals.
Efficient employment of resources: Using batch totals to reconcile the payment
data is more efficient than reviewing each payment.
Security of resources, payment input validity, payment input completeness,
payment input accuracy, payment update completeness, and payment update
accuracy: By reconciling batch totals, the AP accountant, DO, CO, and Fed can
ensure that payments sent to the Fed reflect only those authorized, that cash is not
disbursed inappropriately (security of resources), that only legitimate payments
are sent to the Fed (input validity), that all data are sent (input completeness), and
Accounting Information Systems, 7e
18
that all data are input accurately. We assume that the AP master data is updated
simultaneously with the input of the payment data.
M-8:
Reconcile payments made by ACH to ACH file (and PIF totals and BEPMIS
payments).
Efficient employment of resources: Using batch totals to reconcile the payment
data is more efficient than reviewing each payment.
Security of resources, payment input validity, payment input completeness,
payment input accuracy, payment update completeness, and payment update
accuracy: By reconciling batch totals, the AP accountant, DO, CO, and the Fed
can ensure that settled payments reflect only those authorized, that cash is not
disbursed inappropriately (security of resources), that only legitimate payments
are made (input validity), that all payments are made (input completeness), and
that all payments are made accurately. We assume that the AP master data is
updated simultaneously with the input of the payment data.
Solution Note: Several controls not described in the previous list could be
included in the solution to this problem, as present or missing, depending on
assumptions made. For example:

At each data entry location, we could include automated data entry,
preformatted screens, online prompting, and confirm input acceptance.

As data is entered into the system, we might find programmed edit checks,
populate input screens with master data, and compare input data with master
data.

When there are programmed edit checks, manual comparisons, and
reconciliation of batch totals, we might find procedures for rejected inputs.

Where paper documents are employed, we might find document design,
written approvals, and turnaround documents.
Accounting Information Systems, 7e
Supplier
Start
IPP Server at Xign
Enterprise Adapter
(Intel Server)
M -2, M -3
P-1, P-2, P-3
Flip PO (record
invoice) and send
invoice to BEP
Log on to IPP and
flip invoice
Bureau of Engraving and Printing (BEP)
Translate invoice
data from XM L and
transmit to BEPM IS
BEPM IS/CAS (IBM M ainframe)
P-4, P-5
Perform three-way
match and record
invoice
IDM S
database
M -1
P-6
P-7
M -2, M -3
M -2, M -3
IPP
PO/Invoice
flip display
IPP
Appreciating
database
Translate status
change into XM L and
transmit to IPP server
Transmit status
change to IPP
M -2, M -3
Record invoice
status changes
FIGURE SM-13.12 Problem 2, part c solution—annotated systems flowchart for Internet Payment Platform
(Accounts Payable and Cash Disbursements Processes)
19
Accounting Information Systems, 7e
Disbursing officer
(DO) at FM S RFC
Bureau of Engraving and Printing (BEP)
AP
Accountant
Contracting
officer (CO)
BEPM IS/CAS
(IBM M ainframe)
Record
payments
Start
P-8, P-9
Trigger
payment
process
IPP Server at Xign
Enterprise Adapter
(Intel Server)
Record
payments
Includes display of
invoices due and
selection of those to
be paid
A
P-10
Record CO
approval
IDM S
database
B
Record DO
approval
M-4, P-11
Extract IPP payments,
format, digitally sign,
transmit PIF to IPP
M-5
Number of
payments
and dollars
in PIF
Number of
payments
and dollars
in PIF
P-13
Send E-mail to
CO, DO, and Fed
Number of
payments
and dollars
in PIF
Approval
display
Number of
payments
and dollars
in PIF
P. 2,
A
Log on
to IPP,
approve PIF
Only after DO and
CO approvals
Translate payment
data to XM L, transmit
to IPP server
A
Log on
to IPP,
approve PIF
Optional auditor
approval
B
Approval
display
M-7
M-7
Number of
payments
and dollars
in ACH file
C
C
P.2,
B
Send E-mail to AP,
CO, DO, Boston
Fed, and supplier
P.2,
C
Supplier
M-6
C
Number of
payments
and dollars
in ACH file
Generate
ACH-formatted file,
send to Boston Fed
M-4
M-6
M-7
IPP
Appreciating
database
Daily batch
job
Payments
made
Enter
E-mail to CO,
DO, and Fed
P-12
M-4, P-11
Number of
payments
and dollars
in ACH file
FIGURE SM-13.12 Problem 2, part c solution—annotated systems flowchart (continued)
E-mail notice
that payment
is coming
20
Accounting Information Systems, 7e
21
Federal Reserve Bank
Supplier's Bank
FedACH System
Federal Reserve Bank of Boston
P. 1,
A
P. 1,
C
Read e-mail
Read e-mail
P. 1,
B
ACH-Form atted
file
Number of
payments
and dollars
in PIF
Number of
payments
and dollars
in ACH file
M-7
Transfer
ACH-formatted
file to FedACH
Initiate
transfer of
ACH file
Send Bulk Data
Acknowledgement to
AP, CO, DO, Boston
Fed
Manual intervention is
needed to send ACH file
through several servers
and links to FedACH
M-8
Credit
supplier's
account
Settle the
payment
Number of
payments
and dollars
paid
Bulk Data
Acknow ledgem ent
includes num ber of
paym ents and dollars
paid
M-8
AP
M-8
CO
FIGURE SM-13.12 Problem 2, part c solution—annotated systems flowchart
(continued)
M-8
DO