Management information and control system question and answer

XYZ Ltd., in the business of manufacturing and sales of Packaged Edible Oil, is contemplating conversion to computerized system from present manual system for recording of production, sales, inventory and accounting transactions. Your company has been hired XYZ Ltd. for development of computerized system. Answer the following questions assuming that you have been assigned for system analysis.
Describe any five functional areas of a system which needs to be analyzed system analyst for detailed investigation of the present manual system of the organization.
Based on the functional area of XYZ Ltd., design a template of report to show summary of the production, sales and inventory information of the Edible Oil products produced the company.

Answer
Analysis of the Present System – Detailed investigation of the present system involves collecting, organizing and evaluating facts about the system and the environment in which it operates. Survey of existing methods, procedures, data flow, outputs, files, input and internal controls should be intensive in order to fully understand the present system and its related problems. There are several functional areas, which should be studied in depth. We have discussed the following five major functional areas:

(i) Analyze Inputs – Source documents are used to capture the originating data for any type of the system. The system analyst should be aware of the various sources from where the data are initially captured. He must keep in view the fact that outputs for one area may serve as an input for another area. He must understand the nature of each form, what is contained in it, who prepared it, from where the form is initiated, where it is completed, the distribution of the form and other similar considerations to determine how these inputs fit into the framework of the present system.

(ii) Review data files – The analyst should investigate the data files maintained each department noting their number and size, where they are located, who uses them and the number of times per given time interval these are used. This information may be contained in the system and procedures manuals. He should also review all online and off-line files which are maintained in the organization as it will reveal information about data that are not contained in any output. The related cost of retrieving and processing the data is another important feature to be considered the system analyst.

(iii) Review methods, procedures and data communication – Methods and procedures transform input data into useful output. A procedure review is an intensive survey of the methods which each job is accomplished, the equipment utilized and the actual location of the operations. Its basic objective is to eliminate unnecessary tasks or to perceive improvement opportunities in the present information system. The analyst must review the types of data communication equipment including data interface, data link, modems, dial-up and leased lines and multiplexers. He must understand how the data communication network is used in the present system so as to identify the need to revamp the network when the new system is installed.

(iv) Analyze Outputs – The outputs or reports should be scrutinized carefully the system analyst in order to determine how well they will meet the organization‘s need. The analyst must understand what information is needed and why, who needs it and when and where it is needed. Additional questions concerning the sequence of the data, how often the form reporting it is used, how long it is kept on file etc. must be investigated. Often many reports are a carry-over from earlier days and have little relevance to current operations. Attempts should be made to eliminate all such reports in the new systems.

(v) Review internal controls – A detailed investigation of the present information system is not complete until internal controls are reviewed. Locating the control points helps the analyst to visualize the essential parts and framework of a system. An examination of internal controls may indicate weaknesses that should be removed in the new system. The adoption of advanced methods, procedures and equipment‘s might allow much greater control over the data.

b.
Based on the functional area of XYZ Co., design a template of report to show summary of the production, sales and inventory information of the Edible Oil products produced the company.
A sample template can be as shown below (the answer need not be exactly similar to this but should show relevant information)

ABC Company Ltd.
Address 1, Address 2, City, Country
 

 

Production, Sales and Inventory Summary Report
 
Date:  
Report of Month:  
 
All quantity in thousands of jars.
 

 

SN

 

 

Item

Qty.

Produc ed

 

Previous

Stock

 

This Month’s Sale

 

Closing

Stock

 

 

Remarks

1 Oil 1 100 40 120 20  
2 Oil 2 200 50 190 60  
3 Oil 3 150 80 200 30  
4 Oil 4 90 100 180 10  
5 Oil 5 30 200 230 0 Zero stock
6 Oil 5 280 30 300 10  
 
Note:
1 Check sales report for detailed sales record.
2 Check inventory report for detailed inventory record including batches, dates and age.

 



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