Designing Financial Information System Using Structured System Analysis and Design Method
Upcoming SlideShare
Loading in...5
×
 

Designing Financial Information System Using Structured System Analysis and Design Method

on

  • 208 views

In the following research, the financial information system for the studied company ...

In the following research, the financial information system for the studied company
which had various sub-systems of accounting, payment, storage, properties, salary and
wages systems were analyzed properties system is developed as one of the sub-systems
subsequent to sub-systems problems identification. In both stages of analysis and
designing, Structured System Analysis and Design Method methodology, which has a
Top-Down approach, is used. Based on the studied methodology in analysis stage, system
requirements including needs (determined through studying present system problems)
and obligations (determined by the designer and according to experiences obtained from
similar systems) were identified and considering such requirements, the proper
information system concept model was designed. Some suggestions are represented for
organizations use and information systems development fans, in the final part to the
article.

Statistics

Views

Total Views
208
Views on SlideShare
208
Embed Views
0

Actions

Likes
0
Downloads
3
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Designing Financial Information System Using Structured System Analysis and Design Method Designing Financial Information System Using Structured System Analysis and Design Method Document Transcript

    • International journal of Computer Networking and Communication (IJCNAC)Vol. 1, No. 2(November 2013) 23 Designing Financial Information System Using Structured System Analysis and Design Method Shohrehosadat Karimi Jahromi 1, Nikzad. Manteghi 2 1 Department of Management, Shiraz Branch , Islamic Azad University, Shiraz, Iran 1 2 karimish8@yahoo.com Department of Management, Shiraz Branch , Islamic Azad University, Shiraz ,Iran 2 nik163r@yahoo.com Abstract In the following research, the financial information system for the studied company which had various sub-systems of accounting, payment, storage, properties, salary and wages systems were analyzed properties system is developed as one of the sub-systems subsequent to sub-systems problems identification. In both stages of analysis and designing, Structured System Analysis and Design Method methodology, which has a Top-Down approach, is used. Based on the studied methodology in analysis stage, system requirements including needs (determined through studying present system problems) and obligations (determined by the designer and according to experiences obtained from similar systems) were identified and considering such requirements, the proper information system concept model was designed. Some suggestions are represented for organizations use and information systems development fans, in the final part to the article. Keywords: Accounting Information System, Information System, Structured System Analysis and Design Method 1. INTRODUCTION Development in information technology has led to increase in information in organizations and institutes life and movement. Ordinary individuals could not make decisions in reaching their goals, without being influenced by information [1]. An information system includes a set of individuals, data/information, methods, software, hardware and communications which are active in a company to provide useful information to accelerate and ease the activities, create coordination and control, assist with problems analysis, support decision making and reduce uncertainty in decision-making [2]. Management information system is only considered as a part to authenticate the organization in organizational charts in organizations. Moreover, organizations don’t train their human resources in accordance with such technology [3]. Another point to consider is the organizations structural problems. The organization structure and individuals must be prepared for information circulation and absorption [4]. Also, the culture for demanding decision-making should be changed and substituted with information based management [2]. Appropriate situation should be present to establish an appropriate information system and using that optimally. Among such situations are clear explanations of the problem and objectives, formulating appropriate strategies for system development and support changes, monitoring and managing development processes, professional and scientific efficiency for the system users and training them, appropriate position for information system, defining information systems www.arpublication.org
    • 24 employers’, consulters’, supervisors and commissioners’ roles and duties, and finally the cultural problems [5]. 1.1 Accounting Information Systems Kieso and Weygandt define accounting information systems as an element of the organization which offers decision-making biases for users and fans through processing financial events, warning information and other information [6]. Accounting information system could be considered as a logical intersection between two broader issues of accounting and information systems [7]. The thing which both majors of accounting and management information system share in common is their regards on information. Accounting tends to the information while management information system covers systems which create information. These three environments are presented in Fig. 1[8]. MIS Information Systems AIS Designing and Establishing ,Usage and Management Accounting Providing Information for Financial DecisionMakings Fig. 1 Relation between Accounting, Management Information Systems and Accounting Information Systems 2. Practical Method in Executing This Research SSADM is one of the most popular and complete structured methods in Britain which includes the superior ideas of other methods with the following characteristics [10]: 1It chops the system into smaller pieces and determines the order and the interaction between activities. 2The method uses modeling techniques and diagrams to present a more accurate (structured) and comprehensible definition to users and developers. 2.1 Why is SSADM fit for this project? Among SSADM superiorities on other present methods is that the method defines and combines techniques in a certain framework. Beside analysis techniques, it also provides guidelines for analyzing time and usage of each one. SSADM separates the logical design from physical design and the logical design is carried out independent of hardware/software. TopDown method approach is used in this method, since the Top - Down approach leads to the following problems [11]: 12- Information systems could be in no coordination with organization strategic objectives when they are carried out in lower levels. Political ideas may be applied. www.arpublication.org
    • International journal of Computer Networking and Communication (IJCNAC)Vol. 1, No. 2(November 2013) 25 Although SSADM uses a prescriptive method, this method has a great flexibility and the method should be prepared for certain projects situations. SSADM is used to develop the system, but it doesn’t apply to whole system lifecycle. This method includes the following stages: 1. Present System Operation Analysis 2. Determining the Requirements 3. Data Logical Designing 2.2 Advantages & Disadvantages of SSADM One advantage of SSADM is its use of 3 techniques to determine information system viability. Logical data modeling determines the entities--and relationships between them--in the system. Data flow modeling determines the ways in which data changes from one form to another, the holding areas for the data, the entities that send data into the system and the routes through which the data flows. Entity event modeling documents how events within the business affect the entities of the information system. When these 3 methodologies and viewpoints are provided, the model is more accurate and complete[10]. 2.2.1 Complex Understanding By undertaking such a deep and through analysis of a system, there is a greatly reduced chance of any information being misunderstood at the beginning stages of the project. This can occur in systems that have inadequate analysis and poorly thought out design. Using a familiar process prevents the need to train new staff and saves both money and time [11]. 2.2.2 Control The SSADM is a very structured method of creating information systems. It exercises control over every aspect of the creation process [10]. 2.2.3 Rigidity This rigidity, however, can also lead to some difficulties. It is inevitable that the requirements for the system will change at some point during development. SSADM is built on the analysis of data. If this data changes after the SSADM analysis has already taken place, the system recommended by the data may be incorrect [10]. 2.2.4 Time and Money The biggest problem with the SSADM system is that it takes a great deal of time. When a business takes so much time to analyze the project, it may make it difficult to create the information system by a desired end date. There is a large delay between the inception of the project and the delivery of the system. If any employees of a company are not trained in the SSADM techniques, the company will need to spend even more time and money training them in this difficult system [10]. 2.3 Related Work Appropriate decision making as a way of capturing attractive opportunities is the most important issue for success of a business. Most companies aim to acquire a worthwhile and sustainable advantage in the market and also pass their competitors through diversification; www.arpublication.org
    • 26 therefore cutting costs and improving efficiency are considered as important elements of achieving more advantages in the competing environment. These features of a business become realized when the business can obtain a comprehensive, integrated, and capable Information System (IS) and utilize it. Furthermore implementing customer-oriented strategy requires applying IS in different fields and divisions of work in organization such as marketing [12]. In similar study they analyzed Marketing Information System (MIS) of Sugar Cane and ByProduct Co. as a holding company. In the process of analysis, after identifying subsystems of MIS, Sale Information System is developed as a one of subsystems. In both analyzing and developing steps, Structured System Analysis and Design Method (SSADM) were applied. According to SSADM in the analyzing step, contingencies of system (include needs and requirements) wrer identified and then considering them, conceptual model of information system was designed. 3. Case Study In this section we use the SSADM method to analysis and design financial information system for Fars Power Generation Management Company that is a subset of Tavanir holding company. The headquarters for this company is located in Shiraz and its power plants are in Kazerun, Bushehr, Kangan and Jahrom. 3. 1. Analysis and Design Financial Information System In this phase the following stages will be closely scrutinized. 3.1.1 Identification Systems Problems Reviewing reporting model, lack of access for users, lack of appropriate relation between systems and considering changes created in commercial world show that this model has not been able to keep its pace with these fast changes. Hence, considering the need for fast access to information, and users and decision-makers expectations who like to have access to up to date information, a review in relation between systems seems to be of essence. 3.1.2. Identified Problems in Financial Information System in S.F.P.G.M.C: 1. Lack of access for the users (power plants managers) to the present integrated system in headquarters (Shiraz) which has led to failure for the company informatics section to reach the integrated systems creation objective. Hence, the company is sufficed with island systems. 2. Lack of bilateral relation between present sub-systems. As an instance, there is a lateral relation between accounting sub-system and wages and salary, storage, liquidities and properties. 3. Company various parts geographical communicative and information networks. dispersion and difficulties in creating 4. Duplications in registering personnel, product and services sales persons’ information due to lack of integrity in sub-systems. 5. Lack of appropriate usage of resources and time due to the duplication. 3.2. Determining System Requirements For each of information requirements a set of systems which should provide the information is listed in Table 1. www.arpublication.org
    • International journal of Computer Networking and Communication (IJCNAC)Vol. 1, No. 2(November 2013) Information Providing Systems 27 Information Requirements Accounting System - Bank Bills - Bank Statements - Temporary, Monthly and Annual Balance Sheets - Accounts Turnover - Opening and Closing Documents - Financial Documents - Related Reports on Financial Year Wages and Salary System - Salary and Net Income Payroll - Wages and Salary Financial Documents Draft - Banks, Insurance, Taxes and Overtimes Working Lists - Loan Installments Information and Other Country Separate Units - Reports based on Specific Information Items - Statistical Reports and Diagrams Payment System - Related Documents to Organization Payments - Financial Documents - Issued Checks - Bank Accounts Reports - Check Information - Issued, Missing, Reserved and Canceled Checks Reports - Cash and Non-Cash Payments Reports Property System - Organization Properties Change Report - Organization Cars - Properties and Assets Status - Properties Value ( Categorizing Based on Properties Value) - Delivered Properties Profile - Present Properties and Assets Report - Non-Consumable/ Ruined Properties Report - Properties Depreciation Report - Financial Reports Related to Properties and Assets - Properties Physical Displacement and Deployment Storage System - Warehouses, Inventories, Storage Charge, Goods Enter and Exist Condition - Issued Drafts of Warehouse Report Stock Report - Incoming Receipts to the Warehouse - Table1. Systems- Information Requirements Matrix 3.3. Ideal Situation Entities List In Table 2, organization entities are introduced in contrast with systems in ideal situation. This list is determined in accordance with organization information requirements and used in suggested Entity Relation Diagram. www.arpublication.org
    • 28 System Storage Entity Organizational Unit Properties Payment Wages and Salary Accounting Financial Documents Accounts Wages and Salary Function Personnel Provisions Personnel Warehouse Properties and Equipment Regulations and Instructions Units Performance Report Welfare Payment Table2. Systems-Entity Matrix 3.4. Suggested DFD (Data Flow Diagram) He revised DFD for systems ideal situation (which could meet the determined requirements as possible) is presented. The relation between identified functions in organization and macroentities is shown in Fig. 2 and Fig. 3. Property Information 1 property Product Property D1 Depreciation Documents Property Information various Reports 2 Accounting D2 Financial Eepert Accounting Information Fig. 2 S.F.P.G.M.C Accounting System DFD (Level One) (Suggested) www.arpublication.org
    • International journal of Computer Networking and Communication (IJCNAC)Vol. 1, No. 2(November 2013) 29 4 Details of Vehicle 3 Sale of Property View property vehicles Sales Summary 1 Property Information property Product Property Depreciation Documents D1 Property Information Financial Expert Various Reports 2 Accounting D2 Accounting Information Fig. 3 S.F.P.G.M.C Property System DFD (Level One) (Suggested) 3.5. Suggested ERD (Entity Relation Diagram) ERD is the most significant diagram in an information system data model. There are some places for Data Store in DFDs. While most system analyzers consider ERDs as an image of such places and a dependent to DFDs, ERD models are more than a graphical image of a DFD Data Store. They are independent of processes which are done on Data Stores.The main concept on ERDs which should be considered is that such diagrams neither explain information fellows nor the process fellow. Hence, they are not to be studied like DFDs or fellow charts. ERDs show the data which is stored in a static manner. Such diagrams don’t have any details on data usage, creation, updating or omission. ERDs are used in various phases in systems improvement cycle in SSADM. (Fig. 4) [ ]. 21 Fig. 4 S.F.P.G.M.C Financial of Systems ERD (Suggested) www.arpublication.org
    • 30 4. Results or Conclusions In general, the results of any practical work based on measurable goals are Usually the design of information systems in each suite, same results conceivable. Speed of decision-making, the accuracy of the exercise, increase efficiency and improve effectiveness to do the main part of the results is possible for an information system [13]. This paper uses structured systems design methodology for analyzing and understanding the information needs of managers of Fars Power Generation Management Company of Financial Information discussed in the context of information systems. In the design phase, it is tried to the needs of the management company must match exactly with the information. In this context, inputs, outputs, data, processes and system documentation such as data flow diagrams and entity relationship diagrams provide information in a manner and form of the financial information system of case study. Results to this research are represented in the following Table 3. Subject S.F.P.G.M.C Information Deficiencies Results Review Present Condition Accounting Presence of Parallel Activities System Desired or Suggested Condition Omitting Parallel Activities by DFD in Desirable Condition (Fig. 4) Presence of Redundant Information Omitting Redundant Information Forming a Database (Fig. 2) by Low Speed in Information Fellow Designing Desirable Condition by DFD (Fig. 3) Existing Administrative Dispersion and Inconsistency Systems Creating Common Entity for Sub-systems ( Organizational Unit Entity) Managers Lack of Access to the Financial Creating Entity of Performance and Reports and Information Connection with Organizational Unit for Quick Access S.F.P.G.M.C Accounting Lack of Interaction between Property Creating Interaction by EDR in Desirable Information Sub-systems System and Accounting System Condition(Fig. 4)and Level One DFD in Relation Desirable Condition (Figure2, 3) Lack of Interaction between Payment As Suggestions For Further Research are Discussed System and Accounting System Lack of Interaction between Storage As Suggestions For Further Research are Discussed System and Accounting System Lack of Interaction between Wages and As Suggestions For Further Research are Discussed Salary System and Accounting System Table3. Results. In order to make optimal use of financial information systems and the results of this research and integrating financial systems desirable design and consider the required outputs, files and www.arpublication.org
    • International journal of Computer Networking and Communication (IJCNAC)Vol. 1, No. 2(November 2013) 31 data from the database via the network, and the outputs of the financial system administrators need to be prepared to be online. It is suggested to run the web so that managers and employees in any place without the physical constraints of the network through an Internet connection and password information, to make needed reports. REFERENCES [1] Papatsoutsos Dimitrios,“Information Systems Development Methodologies in the Age of Digital Economy”,University of Athens Department of Informatics University Campus TYPA Buildings, 2005. [2] Ed o’Donnel, Julie Smith David, “How information systems influence user decisions: a 5research framework and literature review ”,International Journal of Accounting Information systems, 1, pp 178-203 , 2000. [3] Winter, M.C., Brown, D.H. and Checkland, P.B. A role for soft systems methodology in nformation systems development. European Journal of Information Systems; Vol. 4, No. 3, pp. 130-142 (1995). [4] Aydin Mehmet Naflz; Harmsen Frank; Slooten Kees Van;Stegwee Robert A,”An Agile Information Systems Development Method in Use”,Turk J Elec,Vol.12,No.2, 2004. [5] Mcleod, Raymond Jr., “Management Information Systems”, 4th . ed. Maxwell MacMillan, (1990). [6] E. Mack , Implementing a Secure Accounting Information System ,Bridgewater State University (2007). [7] Romney ,Marshall. B. Accounting information systems , 8th Ed , Prentice Hall ( 2008). [8] Cushgin, Barry E., “ Accounting Information Systems and Business Organizations” , 3 rd ed, Addison Wesley, (1982). [9] Wu, Fredrick H., “Teaching Accounting Information Systems: A Synthesis”, Issues In Accounting Education, pp. 132-142 (1983). [10] Hall, J, How is SSADM4.2 different from SSADMV4?, SSADM4+ for academics, CCTA & International SSADM User Group Workshop, Leeds Metropolitan University (1995). [11] Jayaratna, N, Understanding and evaluating methodologies, McGraw- Hill (1994). [12] Dellinger, A. B. & Leech, N. L. Toward a Unified Validation Framework in Mixed Methods Research. Journal of Mixed Methods Research; Vol. 1, No. 4, pp. 309-332 (2007). [13] Carton, Fergal & Adam, Frederic. Understanding the Impact of Enterprise Systems on Management Decision Making. Electronic Journal of Information Systems; Volume 8 Issue.p99106 ( 2005). www.arpublication.org