Which type of documentation technique depicts the flow of data through a system?

Accounting Information Systems, 13e (Romney/Steinbart) Chapter 3 Systems Documentation Techniques

3 Prepare and use data flow diagrams to understand, evaluate, and document information systems.

1. Graphical representations of information are often supplemented by A) narrative descriptions. B) relevant e-mail communications. C) logic charts. D) oral descriptions from management. Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

2. All of the following are guidelines for preparing data flow diagrams except A) show the most detail in the highest-level DFD. B) include all storage files, even if they are only temporary. C) uniquely name all data flows. D) sequentially number process bubbles. Answer: A Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

3. The Sarbanes-Oxley Act requires independent auditors to A) create flowcharts to document business processes. B) understand a client's system of internal controls. C) establish effective internal controls. D) prepare and understand all types of system documentation. Answer: B Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

4. The passage of the Sarbanes Oxley Act A) made documentation skills even more important. B) requires public companies to prepare an annual internal control report. C) mandates that auditors must be able to prepare, evaluate and read documentation tools such as flowcharts. D) all of the above Answer: D Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

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1. Which of the following is not a true statement? A) Documentation tools save an organization both time and money. B) Documentation tools are used extensively in the systems development process. C) Data flow diagrams and flowcharts are the two most frequently used systems development documentation tools. D) Data flow diagrams and flowcharts are difficult to prepare and revise using software packages. Answer: D Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

2. A data flow diagram A) is a graphical description of the source and destination of data that shows how data flow within an organization. B) is a graphical description of the flow of documents and information between departments or areas of responsibility. C) is a graphical description of the relationship among the input, processing, and output in an information system. D) is a graphical description of the sequence of logical operations that a computer performs as it executes a program. Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

3. In a DFD, a "data sink" is also known as a A) data store. B) transformation process. C) data flow. D) data destination. Answer: D Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

4. In preparing a DFD, when data are transformed through a process, the symbol used should be A) a circle. B) an arrow. C) a square. D) two horizontal lines. Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

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1. Most processes on a DFD can be identified by A) data in-flows only. B) data out-flows only. C) data flows both into or out of a process. D) always being followed by a data store. Answer: C Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

2. More than one arrow is needed between symbols on a DFD if A) data elements always flow together. B) data elements flow at different times. C) data elements flow to different locations. D) there is no guideline on use of single or multiple arrows. Answer: B Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

3. A DFD created at the highest-level or summary view is referred to as a A) process diagram. B) overview diagram. C) content diagram. D) context diagram. Answer: D Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

4. In a payroll processing DFD, the "prepare reports" activity will be represented by ________, the "employee payroll file" will be represented by ________, and the "management" will be represented by ________. A) a circle; two horizontal lines; a square B) a circle; two horizontal lines; two horizontal lines C) a rectangle; a square; a circle D) a square; two horizontal lines; a circle Answer: A Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. The American Bread Company is a small restaurant that collects, stores, prepares and provides meals to customers in Miami, Florida. When food is received, it is recorded in a database and a receiving ticket is provided to the vendor. When food is used, the database is updated so that it always reflects the amount and type of food available to customers. In a data flow diagram, which type of symbol would be used to represent vendors? A)

B)

C)

D)

Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

1. The American Bread Company is a small restaurant that collects, stores, prepares and provides meals to customers in Miami, Florida. When food is received, it is recorded in a database and a receiving ticket is provided to the vendor. When food is used, the database is updated so that it always reflects the amount and type of food available to customers. In a data flow diagram, which type of symbol would be used to represent the system processing food received from the vendor? A)

B)

C)

D)

Answer: B Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

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1. The American Bread Company is a small restaurant that collects, stores, prepares and provides meals to customers in Miami, Florida. When food is received, it is recorded in a database and a receiving ticket is provided to the vendor. When food is used, the database is updated so that it always reflects the amount and type of food available to customers. In a data flow diagram, which type of symbol would be used to represent the flow of data provided by the vendors into the system? A)

B)

C)

D)

Answer: C Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

1. Terrell and Monique Anderson run an antique store in their hometown of Dayton, Ohio. To find items to sell in their shop, they travel around the United States and Europe buying unique artifacts. Within an hour of making a purchase, they use their smartphone to take a picture of the item and post a short tweet about the item on Twitter. Then, they ship the item back to Dayton for sale in their shop. Which symbol should be used to represent Twitter in a context diagram of this process? A)

B)

C)

D)

Answer: A Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. Terrell and Monique Anderson run an antique store in their hometown of Dayton, Ohio. To find items to sell in their shop, they travel around the United States and Europe buying unique artifacts. Within an hour of making a purchase, they use their smartphone to take a picture of the item and post a short tweet about the item on Twitter. Which symbol should be used to represent the preparation of data for their tweet in a context diagram of this process? A)

B)

C)

D)

Answer: B Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

1. Terrell and Monique Anderson run an antique store in their hometown of Dayton, Ohio. To find items to sell in their shop, they travel around the United States and Europe buying unique artifacts. Within an hour of making a purchase, they use their smartphone to take a picture of the item and post a short tweet about the item on Twitter. Which symbol should be used to represent the transfer of data to Twitter in a context diagram of this process? A)

B)

C)

D)

Answer: C Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

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1. A well-planned and drawn context data flow diagram will include how many processes? A) one B) between 5 and 7 C) between 2 and 7, but no more than 7 D) as many as are needed to accurately depict the process being documented Answer: A Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

2. Data flow diagrams depict A) processes, but not who is performing the processes. B) processes, but not the data that flows between processes. C) who is performing processes, but not how they perform the process. D) who is performing processes, but not the data that flows between processes. Answer: A Objective: Learning Objective 1 Difficulty: Difficult AACSB: Reflective Thinking

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1. Which is the correct label for the blank transformation process circle in the data flow diagram below?

A) 1 Check Credit B) 1 Enter Order in Sales Journal C) 1 Does Customer Have Credit? D) 1 Salesperson Approves Answer: A Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. Explain two reasons why it is important to have a working knowledge of DFDs and flowcharting. Answer: First, SOX requires auditors to evaluate internal control systems. Data flow diagrams and flowcharts are the two most frequently used development and documentation tools used in practice. Second, since systems development is extremely complex, DFDs and flowcharts are tools that are used to create order from chaos and complexity. Third, documentation tools and concepts are covered on the CPA exam. Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

2. What does the Sarbanes-Oxley Act require that is relevant to documentation tools? Answer: The Sarbanes-Oxley Act requires that independent auditors understand the automated and manual procedures an entity uses. One of the best ways to gain this understanding is to use the flowcharts to document the internal control system, as weaknesses and strengths are more easily spotted from such graphic portrayals. Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

3. Describe a situation in which data flow should be shown with two data flow lines instead of one. Answer: A data flow may consist of one or more pieces of datum. The determining factor is whether the data elements always flow together at the same time. For example, "customer payment" have both payment and remittance data. Since these elements always flow together, only one data flow line is required. However, data flows between the customer and the payment processes have customer inquiries and cash receipts; these data items do not always flow together at the same time. In such a case, two data flow lines will be shown. Objective: Learning Objective 1 Difficulty: Moderate AACSB: Reflective Thinking

4. Describe the different levels of DFDs. Answer: The highest-level or summary view DFD, which shows major inputs/outputs and a single process is called a context diagram. The DFD itself shows inputs, major processes, and outputs; each process in the DFD can be "exploded" or shown in greater level of detail with the sub-processes and related data flows. Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. How is a DFD different from a flowchart? Answer: The purpose of a DFD is to diagram the origins, flow, transformation, storage, and destination of data. The purpose a flowchart is to present a graphical description of the flow of documents, relationships among input, processing, and output, or the sequence of logical operations in an information system or program. A DFD is limited to basic symbols and lines, and focuses on the flow and use of data. A flowchart will generally be more complex, and more focused on the managerial, AIS, or IS aspects of the organization. Objective: Learning Objective 1 Difficulty: Difficult AACSB: Reflective Thinking

2. Explain the relevance of the Sarbanes Oxley Act to the documentation tools presented in this chapter. Answer: The Sarbanes Oxley Act of 2002 requires executives of public companies to document and evaluate internal controls. External auditors must evaluate management's assessment of internal control and attest to its accuracy. Therefore, company executives and the auditors must document and test the internal controls — documentation tools, such as flowcharts, are used to do this. Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

3. Discuss the idea of a data flow. Answer: A data flow is a graphic representation of the flow of data between processes, data stores, and data sources and destinations. A data flow is really a form of communication. When the analyst draws a curved or straight line with an arrow at one end, what is represented is a form of communication among the other elements of the data flow process. Consider for example a data source being depicted by a box. The box represents a data source. Data then is sent from the source to a circle, which represents a transformation process. The source of data sends the flow to the transformation process, which will process the data and somehow use the data or turn it into useful information. Note that data flows can represent one or more pieces of datum. Because data flows may have more than one data element, the analyst must determine whether to show one or more lines. Good DFDs and data flow lines in such diagrams eliminate the need for users and analysts to "infer" what type of information is flowing. Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. Following is a context diagram for a current Payroll Processing System. a) Identify the data sources and destinations, data flows, and transformation process marked by question marks. b) What would you need to do to explode this diagram?

Answer: 1 - Human resources, 2 - Time cards, 3 - Payroll processing system, 4 - Employee paychecks or pay-stubs, 5- Payroll report, 6 - Government agencies, 7- Banks. To explode this diagram, additional information is needed to identify detailed procedures within the payroll processing activity as well as additional inputs and outputs. It would be useful to obtain a comprehensive narrative of the payroll processing procedures for review and identification of these items. If there is no narrative available, interviews are another source of information. Objective: Learning Objective 1 Difficulty: Difficult AACSB: Reflective Thinking

1. True or False: The Sarbanes-Oxley Act requires auditors to create flowcharts to document business processes. Answer: FALSE Objective: Learning Objective 1 Difficulty: Moderate AACSB: Reflective Thinking

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1. In the data flow diagram below, Shipping is a

A) data store. B) data flow. C) data source. D) data destination. Answer: D Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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1. True or False: In the data flow diagram below, a customer order must be approved before the company checks to make sure the inventory is available.

Answer: FALSE Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

1. In a data flow diagram of the vendor payment process, what symbol would most appropriately reflect an update of the payables account? A) a square B) a circle C) two horizontal lines D) none of the above Answer: B Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

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1. In a data flow diagram of the vendor payment process, "Vendor" will appear above or in A) a square. B) a circle. C) two horizontal lines. D) none of the above Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

2. In a data flow diagram, an inverted triangle represents A) an internal control. B) document filing. C) on page connection. D) document processing. Answer: A Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic

3. In a data flow diagram that depicts a company's internal controls, where is each internal control typically explained in detail? A) in an annotation on the same page as the internal control B) inside the symbol used to represent the internal control C) on a table that accompanies the internal control data flow diagram D) Internal controls are not typically explained in detail in an internal control data flow diagram. Answer: C Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

4. Which documentation technique would not depict the type of storage medium used (such as a flash drive or a hard drive) to physically store data? A) system flowchart B) data flow diagram C) business process diagram D) internal control flowchart Answer: B Objective: Learning Objective 1 Difficulty: Moderate AACSB: Analytic

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What shows the flow of data through a system?

What is data flow documentation?

What are some of the different techniques for documenting data flows?

What is data flow technique?