Accounting information system an overview 9e bodnar hopwood chapter 07

Customer Order and Account Management Business Processes Chapter  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–1 Learning Objective Describe the customer order management business process  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–2 Customer Order Management Business Process Inquiry (optional) Contract creation (optional) Order entry Shipping Billing  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–3 Customer Order Management Business Process Optional Steps Order entry Inquiry Shipping Contract creation Billing  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–4 Enterprise Resource Planning ERPs are information systems capable of storing and processing information pertaining to the customer order management business process It is a registered trademark (http://www.sap.com)  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–5 Enterprise Resource Planning SAP R/3 stores and processes data related to the customer order management business process The customer order management business process is part of SAP’s sales and distribution module  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–6 Customer Master Records These records have to be created before processing sales orders SAP R/3 requires four types of master records: Sold-to customer Ship-to customer Bill-to customer Payee customer  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–7 Customer Master Records When a new sold-to-customer master record is created, the other three master records are automatically created Customer master records should be unique SAP R/3 requires that a customer has been approved for sales prior to the creation of master records  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–8 Data Fields Customer master records are created by inputting information into R/3 R/3 guides the input process by displaying a series of customer screens on a video monitor Each screen collects a category of data What are these Create Customer screens?  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7–9 Data Fields Initial screen  Customer address  Control data  Marketing  Payment transactions  Unloading points   2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Customer Account Management Business Process There are two basic approaches to an accounts receivable application What are these approaches? Open-item processing Balance-forward processing  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Learning Objective Illustrate controls that apply to accounts receivable processing  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Controls in the Accounts Receivable Business Process Customer Receiving Returned goods Cash Receipts Accounts Receivable Remittance advices Remittance advices Control total Post  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood General Ledger Control total 7– Controls in the Accounts Receivable Business Process Receiving Credit Independent Approve count sales return Sales return Sales return memo memo Billing Invoices Accounts Receivable General Ledger Control totals Control totals Journal voucher Journal voucher Sales return memo  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Controls in the Accounts Receivable Business Process Customer Credit Aged trial balance Billing Periodic processing Credit memo Statements Accounts Receivable Aged trial balance Credit memo Post Statements  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Write-Off Accounts Receivable The basic feature in a write-off process is an analysis of past-due accounts This is usually done with an aged trial balance report  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Write-Off Accounts Receivable Treasurer Write-off memo Credit Accounts Receivable General Ledger Internal Audit Aged trial balance Aged trial balance Control total of write-offs Control total of write-offs Write-off memo Write-off memo Write-off memo Worthless account list Worthless account list File Confirmation of write-off sent to customer  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash-Received-On-Account Business Process A cash-received-on-account business process is used when there is an existing customer account balance Cash received on account typically comes into a business through the mail or is paid in person to a central cashier or a cash window  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash-Received-On-Account Business Process Customer payments should always be acknowledged The recorded receivable that exists prior to the payment enhances control over payments received  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash-Received-On-Account Business Process The major control feature of cash-receivedon-account business process is the separation of the following functions: Mailroom Cash receipts Accounts receivable General ledger Bank Internal audit  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Lock-Box Collection Systems It is the time between the signing of the payment check by the customer and the moment the firm has use of the funds A lock-box system reduces the float by having the checks deposited to a firm’s account before the firm processes them  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash Sales Business Process The significant difference between a cash sales business process and a cash-receivedon-account business process is that there is no previous asset record in a cash sales business process Cash sales are recorded in a cash register or other secure device to provide documentation  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash Sales Business Process It is a general term used to describe procedures in which the customer acts as a control over the initial documentation of a transaction  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– Cash Sales Business Process What are some of these procedures? Pricing in such a way that the customer expects change Awarding a customer free items if the receipt has a mark  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 7– End of Chapter  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood – 39 ... Business Publishing, Accounting Information Systems, 9/e, by Bodnar/ Hopwood 7–4 Enterprise Resource Planning ERPs are information systems capable of storing and processing information pertaining... process is an analysis of past-due accounts This is usually done with an aged trial balance report  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/ Hopwood. .. Business Publishing, Accounting Information Systems, 9/e, by Bodnar/ Hopwood 7– Standard Order Processing in SAP R/3 Standard order processing describes the customer order management business process