Context Diagram: Existing System

Figure 1: Context Diagram of the Existing Accounts Receivable System

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 Figure 2: Diagram 0 of the Existing Accounts Receivable System

Narrative for Existing Accounts Receivable System’s DFD

Process 1: Process Customer Orders
This process starts when the customer has placed his or her order through
telephone call or email. It includes information such as quantity and cost of the items as
well as the mode of payment and credit terms. The accepted orders will be kept in the
pending orders data store.
Note: The company lists down the accepted orders in logbook.
The company usually wait for 3 to 5 days until they proceed to the next process.

Process 2: Process Purchase Orders

When the order information has been received, this process commences. The
company communicates with supplier to order the desired air-conditioning unit parts. The
company may either access LG Electronics System online or call through telephone.
Note: The supplier will notify the company if they have acknowledged its purchase
order through LG Electronics System, email, or call.

Process 3: Process Company Orders

The supplier will then deliver the air-conditioning unit parts along with the company
bill which usually takes 3 days. The company also inspects the supplies received for

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defects. Whereas the rejected supplies will be sent back to the supplier. Moreover, the
delivered products will be stored in the inventory data store and the company bill will be
used for the next process.

Process 4: Process Company Payment

Upon being informed of the amount to be paid from the received company bill, the
company will now pay it through bank.

Process 5: Process Order Delivery

The customer order will now be processed for packaging and will be delivered to
the customer along with an invoice which will also be used for accounting purposes.
Note: The company has its own invoice template. It includes information such as
company name, amount, quantity, unit price, and the description of the item ordered.

Process 6: Record Credit Transaction

The invoice copy produced in the prior process will be the basis for recording the
credit transactions and will be accumulated in the accounts receivable data store which
acts as the accounting records of the company such as general journal and general
ledger.

Process 7: Process Customer Payment

The customer may apply full or partial payment in their credit balances either
through bank or over the counter.
If the payment is made through bank, the customer will pay according to the invoice
received and will be given a deposit slip. The customer will take a photo of this deposit
slip which will be sent through email to the company as a proof of payment.

On the other hand, the payment may also be made over the counter, it can be by
check or by cash. If it is by check, it will be forwarded by the company to the bank for
encashment then the bank will issue a deposit slip that will be used for the next process.
If it is by cash, the company can directly issue an official receipt which will also be used
for the next process.

Note: There are instances where the customer hands over the cash to the deliveryman.
It usually happens when there is a little amount involved.

Process 8: Update Accounts Receivable

The information gathered from process 7 (which are the deposit slip and official
receipt) will be used as a basis to update the accounts receivable which will then be stored
in the accounts receivable data store.

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Context Diagram: Proposed System

Figure 3: Context Diagram of the Proposed Accounts Receivable System

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 Figure 4: Diagram 0 of Proposed Accounts Receivable System

Narrative for Proposed Accounts Receivable System’s DFD

Process 1: Process Customer Orders
This process starts when the customer has placed his or her order through
telephone call or email. It includes information such as quantity and cost of the items as
well as the mode of payment and credit terms. The accepted orders will be kept in the
pending orders data store.
Note: The company lists down the accepted orders in logbook.
The company usually wait for 3 to 5 days until they proceed to the next process.

Process 2: Process Purchase Orders

When the order information has been received, this process commences. The
company communicates with supplier to order the desired air-conditioning unit parts. The
company may either access LG Electronics System online or call through telephone.
Note: The supplier will notify the company if they have acknowledged its purchase
order through LG Electronics System, email, or call.

5
Process 3: Process Company Orders
The supplier will then deliver the air-conditioning unit parts along with the company
bill which usually takes 3 days. The company also inspects the supplies received for
defects. Whereas the rejected supplies will be sent back to the supplier. Moreover, the
delivered products will be stored in the inventory data store and the company bill will be
used for the next process.

Process 4: Process Company Payment

Upon being informed of the amount to be paid from the received company bill, the
company will now pay it through bank.

Process 5: Process Order Delivery

The customer order will now be processed for packaging and will be delivered to
the customer along with an invoice which will also be used for accounting purposes.
Note: The company has its own invoice template. It includes information such as
company name, amount, quantity, unit price, and the description of the item ordered.

Process 6: Record Credit Transaction

The invoice copy produced in the prior process will be the basis for recording the
credit transactions and will be accumulated in the accounts receivable data store which
acts as the accounting records of the company such as general journal and general
ledger.

Process 7: Encode Accounts Information

The gathered data from the accounts receivable datastore will be used in this process. It
will be encoded to the proposed software that the IT personnel will create namely ‘Pay-On-Time
Software’ (POTS).

Process 8: Determine Due Accounts

The list of encoded accounts will be automatically arranged according to its credit term. If
an account is due in 7 days, the software will automatically create a copy of these accounts to a
‘due accounts folder’.

Process 9: Process Customer Communication

In this process, the system will use the company’s provided email to send messages to
the customers with due accounts. The message will contain information such as the amount due,
the due date and a note encouraging the customer to send a feedback. In return, the customer
may send a reply if they can or cannot conform to their obligation. If the customer defaults on his
payment, the company will give a corresponding grace period on a case-to-case basis (minimum
of 3 days and maximum of 28 days).

Process 10: Process Customer Payment

The customer may apply full or partial payment in their credit balances either
through bank or over the counter.
If the payment is made through bank, the customer will pay according to the invoice
received and will be given a deposit slip. The customer will take a photo of this deposit
slip which will be sent through email to the company as a proof of payment.

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 On the other hand, the payment may also be made over the counter, it can be by
check or by cash. If it is by check, it will be forwarded by the company to the bank for
encashment then the bank will issue a deposit slip that will be used for the next process.
If it is by cash, the company can directly issue an official receipt which will also be used
for the next process.
Note: There are instances where the customer hands over the cash to the delivery man.
It usually happens when there is a little amount involved.

Process 11: Update Accounts Receivable

The information gathered from process 7 (which are the deposit slip and official
receipt) will be used as a basis to update the accounts receivable which will then be stored
in the accounts receivable data store.