Chapter 2 Accountants as Business Analysts.docx

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Accounting & Financial Management
AFM 341
Jee Hae- Lim

Chapter 2 Accountants as Business Analysts Changing Roles of Accountants in Business - Past; accountants focused on stewardship and reporting functions: kept financial records, prepared financial reports and audits - Now: business intelligence and enterprise resources planning systems have increased the availability of data throughout the organization -> Business Management Support o Act as Business Partners: Strategic planning, process improvement, compliance  To perform new roles, accountants must first understand the business as well as the various ways that the business collects data Business Process Documentation Definitions - Business process: defined sequence of business activities that use resources to transform specific inputs into outputs to achieve a business goal - Business analysis: process of defining business process requirements and evaluating potential improvements, involves ascertaining, documenting, and communicating - Business model: simple, abstract representation of one or more business processes - Documentation: explains how business processes and business systems work Purposes of Documentation - Sarbanes Oxley Act of 2002 made documentation essential for businesses o Assess and attest to the business’s internal control structure and procedures o Annually evaluate whether ICFR is effective at providing reasonable assurance and to disclose its assessment to investors o Requires external auditors to audit management’s assessment of effectiveness - Documentation important for: o Training: user guides, employee manuals, operating instructions o Describing current processes and systems: supports internal and external audit requirements, establishes accountability and standardizes communication o Auditing: documentation provides audit trails, helps determine effectiveness o Accountability: checklists, delegations of authority, similar assignments of responsibility o Standardized interactions: describes the inputs and outputs of business processes o Facilitating process improvement:  Effectiveness  Efficiency  Internal control  Compliance Value of Business Models - Allow us to depict the important features of business processes and systems clearly and concisely o Suited for planning business transformations because it allow managers to assess what needs to be changed  Mergers, acquisitions, offshoring, product innovation, and continuous process improvement  Manage complexity, elicit requirement, reconcile viewpoints and specifies requirements Types of Business Models - Business process models need to describe process activity, data structure, and business rules that constrain and guide process operations - Activity Models o Describes the sequence of workflow in a business process  Ie. flowcharts used to analyze business processes and design changes - Structure Models o Create a blueprint for the development of a relational database to support the collection, aggregation and communication of process information - Regardless of modeling, specific workflow models must be able to describe: o Events that start, change or stop flow in the process o Activities and tasks within the process o Sequence of flow between tasks o Decision points that affect the flow o Division of activity depending on organizational roles Business Process Modeling Notation - Employed for activity models - Method of illustrating business processes in the form of a diagram similar to a flow chart Building Blocks for BPMN Diagrams - Events include start, intermediate and end events o Intermediate events affect flow of process but do not start or end it o Basic events are modeled as small circles o Start events have a single thin line circle o End events have a single thick line circle o Intermediate events have double thin line circle - Activities represent specific steps in the business process o Basic are modeled as rounded rectangles o Each activity is described with a short verb phrase o Can depict a single action or some logical combination of actions depending on the required level of detail to achieve the objectives of the business process analysis - Sequence flows are represented by arrows to indicate the progression of activity within the process - Gateway shows process branching and merging as the result of decisions o Basic gateways are depicted as diamonds (usually appear as pairs) - Annotations allow the modeler to add additional descriptive information to the model Example of a Business Process Diagram - Figure 2.3 illustrates a simple business process activity diagram showing the checkout process at a retail store o Customer presents items for checkout o Clerk scans items and identifies payment method o Payment is accepted and process branches merge o Clerk bags items for customer and process ends Identifying Participants in Business Process Diagrams - Participants include people, systems, organizations and machines - BPMN provides notation to identify both the organizations and the department or individual actors participating in a process o Organization is identified by a pool and department is identified by swimlanes within the pool o Every diagram contains at least one pool but if there is only one pool, the pool may be presented without a
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