Midterm Examination

Question 1 (30 Marks)

The Happy Valley Utility Company uses turnaround documents, in its computerized customer accounting system. Meter readers are provided with preprinted computer forms, each containing the account number, name, address, and previous meter readings. Each form also contains a formatted area in which the customer's current meter reading can be marked in pencil. After making their rounds, meter readers turn in batches of these documents; to, the Computer Data Preparation Department, where they are processed by a mark‑sense document reader that transfers their contents to magnetic tape.

This magnetic tape file is then sent to the computer center, where it is used as input for two computer runs. The first run sorts the transaction records on the tape into sequential order by customer account number. On the second run, the sorted transaction tape is processed against the customer master file, which is stored on a magnetic disk. Second‑run outputs are (1) a printed report listing summary information and any erroneous transactions detected by the computer and (2) customer bills printed in a special OCR‑readable font. Bills are mailed and customers are requested to return the stub portion along with payment.

Customer payments are received in the mail room and checked for consistency against the returned stubs. Checks are then sent to the cashier's office. The mail room provides the Computer Data Preparation Department with three sets of records: (1) stubs with agreeing amounts, (2) stubs with differing amounts, and (3) a list of amounts received from customers without stubs. For the latter two types of records, data preparation personnel use a special typewriter to prepare corrected stubs. An OCR document reader then processes all the stubs and transfers their contents, onto magnetic: tape.

The magnetic tape containing the payment records is then sent to the computer center, where it is sorted on the computer into sequential order by customer account number and processed against the customer master file to post the payment amounts. Two printed outputs from this second process are reports listing erroneous transactions and summary information and past‑due customer balances.

REQUIRED

a. Draw a systems flowchart of the billing operations, commencing with the computer preparation of the meter reading forms, and ending with the mailing of customer bills.

b. Draw a systems flowchart depicting customer payments processing, starting with the mail room operations and ending with the computer run that posts the payment amounts to the customer master file.

c. Draw a computer configuration flowchart showing the hardware required to accomplish all the operations described.

Question 1 (16 Marks

Part a

Discuss the importance of involving accountants in the detailed design and implementation phases. What tasks should they perform?

Part b

A good structure diagram should be loosely coupled yet strongly cohesive. (like Accpac Plus) These sound incompatible; how can you achieve both characterics simultaneously? What implications do these characterics have on error prone problems during maintenance?

Question 3 (18 Marks)

Systems Planning

A new systems development project is being planned for the Redon Toy Manufacturing Company. The invoicing, cash receipts, and accounts payable modules are all going to be updated. The controller, Mark Bloom, is a little anxious about this project. The last Systems development project that affected his department was not very successful, and the employees in the accounting department did not accept the new system very well at first. He feels that the systems personnel did not interact sufficiently with the users of the systems in the accounting department. Prepare a memo from Bloom to the head of the information systems department, Frank Kennedy. In this memo, provide some suggestions for including the accounting personnel in the systems development project.

Give some very persuasive arguments why prototyping would be helpful to the workers in the accounting department.

Question 4 (20 Marks)

S. Systems Design

Robert Hamilton was hired six months, ago as the controller of a small oil and gas exploration and development company, Gusher Inc., headquartered in Beaumont, Texas. Before working at Gusher, Hamilton was the controller of a larger petroleum company, Eureka Oil Company, based in Dallas. The joint interest billing and fixed asset accounting systems of Gusher are outdated, and many processing problems; and errors, have been occurring quite frequently. Hamilton immediately realized these problems and informed the president, Mr. Barton, that it was crucial to install a new system. Barton concurred and called a meeting between himself, Hamilton and Sally Jeffries, the information systems, senior manager. Barton instructed Jeffries to make the new system that Hamilton wished to have a top priority in her department. Basically, he told Jeffries to deliver the system to meet Hamilton's needs as soon as possible.

Jeffries left the meeting feeling overwhelmed since the IS department is currently working on two other very big projects, one for the production department and the other for the geological department. The next day, Hamilton sent a memo to Jeffries, indicating the name of a system he had 100% confidence in-Amarillo Soft-ware and he also indicated that he would very much like this system to be purchased as soon as possible. He stated that the system had been used with much success, during the past four years; in his previous job.

When commercial software is purchased, Jeffries typically sends out requests for proposals to at least 6 different vendors only after a careful analysis of the needed requirements, is conducted. However, due to the air of urgency demonstrated in the meeting with the president and the overworked systems staff, she decided to go along with Hamilton's wishes, and sent out only one RFP out, which went to Amarillo Software. Amarillo promptly returned the completed questionnaire. The purchase price ($75,000) was within the budgeted amount. Jeffries, contacted the four references provided and was satisfied with their comments. Further, she felt comfortable since the system was for Hamilton, and he had used the system for four years.

The plan was, to install the system during the month of July and try it for the August transaction cycle. Problems, were encountered, however, during the installation phase. The system processed extremely slowly on the hardware platform owned by Gusher. When Jeffries asked Hamilton how they had dealt with the problem at Eureka, he replied that he did not remember having such a problem. He called the systems manager from Eureka and discovered that they have a much more powerful mainframe than Gusher does. Further investigation revealed that Gusher has more applications running on its mainframe than Eureka does, since Eureka uses a two-mainframe distributed processing platform.

Further, the data transfer did not go smoothly. A few data elements being stored in the system were not available as an option in the Amarillo system. Jeffries found that the staff at Amarillo was, very friendly when she called, but they could not always identify the problem over the phone. They really needed to come out to their site and investigate. Hamilton was surprised at the delays between requesting an Amarillo consultant to come out and the time in which he or she actually arrived. Amarillo explained that it had to fly a staff member from Dallas to Beaumont for each trip. The system finally began to work somewhat smoothly in January, after a grueling fiscal year-end close in October. Hamilton's staff views the project as an unnecessary inconvenience. At one point, two staff accountants threatened to quit. The extra consulting fees amounted to $35,000. Further, the systems department at Gusher spent 500 more hours during the implementation process than it had expected. These additional hours caused other projects to fall behind schedule.

Required

Discuss what could have been done differently during the design phase. Why were most of the problems encountered? How might a detailed feasibility study have helped?

Question 5 (16 Marks)

Systems Analysis

Consider the following dialogue between a systems professional, Mike Smith, and a manager of a department targeted for a new information system, John Clark:

Smith: The way to go about the analysis is to examine the old system, such as reviewing documents and observing the workers per-their tasks. Then we can determine what aspects are working well and what should be preserved Clark We have been through these types of projects before and what always ends up happening is that we do not get the new system we are promised; we get a modified version of the old system.

Smith: Well, I can assure you that will not happen this time. We just want a thorough understanding of what is working well and what is not.

Clark: I would feel much more comfortable if we first started with a list of our requirements. We should spend some time up front determining exactly what we want the system to do for my department. Then you systems people can come in and determine what portions to salvage if you wish. Just don't constrain us to the old system!

a. Obviously these two workers have different views on how the systems analysis phase should be conducted. Comment on whose position you sympathize with most.

b. What method would you propose they take? Why?