ACCT10003 Lecture Notes - Lecture 7: Remittance
19 Jun 2018
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Accounting Processes and Analysis
Lecture 7- Conversion Business Process & Payroll Process
Conversion Process
From the business perspective, it includes:
- Manufacturing process – ongoing and special order
- Purchase of raw materials for production
- Organisation and usage of inventory in process
- Finished goods timing and availability
- Allocation resources and therefore costs (‘purchase of resources’ from the organisation)
Underlying economic events:
External supplies: Raw materials, finished goods, machinery
In-house supplies: Labour, Utilities, Intellectual Property, Quality Control, Tools / Machinery
Accounting effect:
How Conversion Happens
Modelling a Conversion Process
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Document Summary
Lecture 7- conversion business process & payroll process. Manufacturing process ongoing and special order. Organisation and usage of inventory in process. Allocation resources and therefore costs ( purchase of resources" from the organisation) In-house supplies: labour, utilities, intellectual property, quality control, tools / machinery. Partner with proper authority authorizes production to ensure finished goods are available to meet expected demand. Issues from raw material according to bill of material recorded accurately. Partner issuing material must not be same partner who authorized production. Partner recording issue of material cannot modify bill of material. System must provide authorization order number control, default values, and range and limit checks; must also create audit trail. System must only allow partner to enter the number of items issued based on bill of material, subject to range and limit checks on quantities; date defaults to current date. Inspection ensures that only products meeting quality standards are allowed. Finished product inventory must be updated promptly and accurately.
