edp first draft
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Balberona, Mary Cris
Catera, Rhea May
Chiu, William Emmanuel
Edang, Erick
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I. Introduction
A. BackgroundBrief History
The Sage Group PLC (Public Limited Company) is one of the leading global suppliers of
business management software and related products and services, principally for small to
medium-sized enterprises. The company was formed in 1981 and was floated on the London
Stock Exchange (LSE) in 1989. Sage operates in over 24 countries covering the UK, Europe,
North America, South Africa, Australia, India and China; and has more than 6 million
customers and more than 13,500 employees worldwide
With the growth in demand, Sage Pastel, Pastels international division, was formed in
the mid-1990s in order to provide world-class accounting product and services in the
international market. In 2003, The Sage Group acquired Softline, which was founded by
Ivan Epstein and Alan Osrin in 1988. Although Softlines heritage involves the SME market,
the company also has enough experience and expertise to cater to the requirements of
specific industries and larger organizations. Softline's core solutions cover accounting,
ERP, Payroll and HR, Business Intelligence, customer relationship management and retail
software solutions to small, medium and larger sized companies in South
Africa and Australia.With Pastels availability in eight languages including English,
Afrikaans, Dutch, Danish, German, Icelandic, Italic and Portuguese, its products are now
used in running many businesses. Today, Pastel products are actively sold in over 52
countries.
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As a leading provider of accounting software packages, ERP software solutions and
business management software solutions, Softline Pastels accounting software solutions
equip businesses in streamlining their accounting and management processes. With its
philosophy and practice of continuous innovation, the company has guided many customers
through a constantly changing technology landscape. As such, it is the preferred choice of
many clients especially in South African businesses. Pastels reputation as the trusted name
in accounting and payroll software is reaffirmed by the fact that 9 out of 10 accountants
recommend Pastel (www.sagepastel.com).
Pastel Product range Family Tree
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Key Statistics and Popular Personalities
The Sage Group PLC is the worlds third-largest supplier of enterprise resource planning
software (behind Oracle and SAP), and the largest supplier to small businesses. An Analysis
by IDC in October 2006 showed that Sages estimated market share of the small business
market is 21%, compared to Microsofts 12%, Oracles 9%, Intuits 6%, and SAPs 3%.The
remaining 49% served by other providers. Moreover, its Softline Pastel currently has
approximately 80% market share in South Africa and has been awarded the Independent
Software Vendor (ISV) Software Partner of the Year by Microsoft.
Sages was founded by David Goldman, Paul Muller, and Graham Wylle. Currently, the
companys key people consists ofTony Hobson (Chairman), and Guy Berruyer (CEO).
II. Objectives of the studyThe following are the objectives of this study:
1. To gain understanding of the software history/background and its reputation in themarket;
2. To identify and describe general features and modules and how they relate to thefunctioning of the software;
3. To comprehend the audit implications of the general features, modules and controlsidentified;
4. To asses the sufficiency and effectiveness of the general features, modules and controlsidentified;
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5. To gauge the impact of implementing the software within the organization;6. To enumerate the requirements for the software to function efficiently and effectively;
and,
7. To give comments after the each discussion and formulate recommendations/conclusionsat the studys end.
Scope and limitations of the study
The study aims to understand and discuss the software Pastel My Business, particularly in
the reliability, completeness and appropriateness of the general features, modules and controls
and the impact of the latter to business operations, preparation of annual financial statements,
and more importantly to the audit process. Discussions will involve matters enumerated in the
objectives coupled with comments deemed appropriate by the proponents to enable deeper
understanding of the logic of the software.
For this matter, the discussion will be constricted only to the software named and shall
not extend to the organization beyond the said software. General controls shall be included only
in the occasion that they are provided in the software. Consequently, application controls shall be
the focus of the study for they are inherent in the software and are required for the latter to
produce acceptable results. Insufficiencies of controls, if determined, shall be discussed together
with comments of the proponents, if necessary.
The study shall include also comparisons of the software named with an ideal software.
For this matter, the proponents shall be make use of the book Auditing EDP Systems by Watne
and Turney (1999) as a guide in formulating the characteristics of an ideal software to facilitate
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comparison. As a main reference, much of the discussions and comments shall be based on the
book stated.
Definition of terms
(a)Accountants Areais used exclusively by the accountant to process journal entries,prepare tax payments and refunds, prepare tax adjustments, and generate reports.
(b)Allocateis the matching each receipt, payment and write-off to a customer or supplierinvoice/account. (n. Allocation)
(c)Average Costingan inventory valuation method in which assigned values toinventories are adjusted/averaged every time purchased items are received
(d)Comma-Separated Values (CSV) file formatis used in importing/exporting bank,credit card statements or transactions to/from the software; consists of any number of
records, separated by line breaks of some kind; each record consists of fields, separated
by some other character or string, most commonly a literal comma or tab; all records
have an identical sequence of fields.
(e)Dashboard (My Business Dashboard)is an easy to read, often single page, real-timeuser interface, showing a graphical presentation of the current status (snapshot) and
historical trends of an organizations Key Performance Indicators (KPIs) to enable
instantaneous and informed decisions to be made at a glance.
(f) Databaseis an organized collection of data in digital form; sometimes known asdatabase management system (DBMS)
(g)Drill Downis a feature that lets the user click on a graph or a total and see thetransactions that make up the total value; is a multi-level that takes the user right down
into the original transaction
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(h)Item/sare the inventory being sold/used by the company(i) Navigation Baris a section of user interface intended to aide users in travelling
through the the software and its modules
(j) Open Financial Exchange (OFX) formatused as an open format for transferring databetween vendors, consumers, and financial systems; may be sent to individual users as
credit card or banking statements from a financial institution; can contain transactions,
statements, and other financial information;
(k)Startup and Small Businessesequivalent to small and medium-sized entities (SMEs);are companies whose personnel numbers fall below certain limits
(l) User Interfacein the industrial design field of humanmachine interaction, is the spacewhere interaction between humans and machines occurs. The goal of interaction between
a human and a machine at the user interface is effective operation and control of the
machine, and feedback from the machine which aids the operator in making operational
decisions.
(m)Widgetis a generic type of software application comprising portable code intended forone or more different software platforms. The term often implies that either the
application, user interface, or both, are light, meaning relatively simple and easy to use,
as exemplified by a desk accessory or applet, as opposed to a more complete software
package such as a spreadsheet or word processor.
(n)Wizardsis a user interface type that presents a user with a sequence of dialogboxes that lead the user through a series of well-defined steps
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III. Software Features:
A. Overview
Pastel My Business is very applicable for start-up and small businesses. This software is
not difficult to use and it helps the business prepare accounts and statements easily. It manages
the whole business cycle. With the functionality of the My Business dashboard, at just a glance,
one has important information available. One can track item quantities, costs, purchases and
manage bank accounts, credit cards and general company expenses. The philosophy of Pastel is
to let the customers go beyond accounting. The software allows simple and effortless daily
financial management so that the customers can focus on their core business and therefore, go
beyond accounting.
B. Features
General Features
Single user, multiple companies Manage customer invoices, payments, outstanding balances, bad debts and customer
statements
Manage supplier invoices, returns, orders and payments due Manage stock purchased, sold and returned, as well as the costs and quantities Report on the top selling stock, as well as the most purchased stock Enter bank account transactions and track the company expense payments Reconcile bank accounts and report on total cash received and paid out Use the profit and loss report to show the profitability of the business Use the VAT report for the VAT submissions
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Record all assets in the business and view an Asset Register Report The accountant can use the Accountants Area to process journal entries, view tax reports
and process tax payments or refunds
Specific Features
These are some of the things the user can do with the software:
Create one or more companies in which to work
Create items to sell
Create suppliers where items are purchased
Create customers where items are sold
Create bank accounts, so that you can pay suppliers and process receipts from customers,
optionally with discounts, and allocate the receipts to invoices.
Create accounts for sundry payments and receipts. This would include items such as rent,
telephone, stationery, bank charges, and so on.
Process journal entries and tax adjustments
Reconcile bank accounts to ensure they coincide with the bank statements
Produce powerful and sophisticated reports, including a Profit and Loss Report and a
Statement of Assets and Liabilities
More Specific Features
Managing Customers and Suppliers
The system keeps statistics of sales per customer and sales per item, purchases per supplier, and
purchases per item. One can create customer categories, supplier categories, and item categories,
and analyse the sales and purchases by these categories.
The system features a powerful Dashboard that shows:
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Due and Overdue invoices
Expired quotes
Overdue notes
Top customers by sales / suppliers by purchases
Top customers / suppliers by balance due
Top selling items
Sales / Purchases history graphs with full drill down to the invoice level
Customer and supplier ageing totals graphs with full drill down to the invoice level
Customer, Supplier, and Item Notes
One can create notes that can be attached to customers, suppliers, and/or items. These notes can
contain text or links to documents. One can specify an action date for each note, and then track
overdue notes via the Dashboard. For example, a customer may promise payment by a date. The
note will show on the Dashboard after that date as requiring action.
Printing, Viewing, and Emailing Reports
One can produce quotes, invoices, credit notes, receipts, and statements. One can print these,
and/or one can email them to customers or suppliers. One can also email any report to anyone.
Access to Company Data
The system gives one unparalleled access to the customer, supplier, item, and transaction
databases. One can list all these records, and one can then sort, group, and filter them to the
heart's content. This makes it easy to find any information one is looking for.
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User Defined Fields
A feature usually only found in far more expensive products is the ability to name and use
custom fields for customers, suppliers, and items. For example, one can track where one obtained
a customer's lead.
Modern Interface
The system features a modern, easy-to-use, and powerful interface that places all the system's
functionality right at ones fingertips:
The Navigation Bar to access frequently used functions with one click
Database entry fields allows one to pick customers and items very simply and even add new
records on the fly as one is working
Date entry to pick dates from a calendar
Wizards to guide one through the processes
Record tables to sort, group, and filter customers, items, invoices, receipts, and so on
Drill down is a feature that lets one click a graphic or a total and see the transactions that make
up the total value. Drill down is multi-level, and takes one right down into the original
transaction.
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SYSTEM REQUIREMENTS
Hardware Single User
Recommended Pentium IV 2GHz or Higher
Operating System
Recommended Windows XP with Service Pack 3, Windows Vista,
Windows 7
RAM
Recommended 1GB or higher
Screen Resolution
Minimum 1024 x 768
Requirements for all Users: DVD-Rom
D. Modules
1. Starting My Business
To start Pastel My Business, My Business icon in the desktop is located. Then, one can
open a specific company or create a company. Each company is a separate entity with its own
customers and transactions. Once a company is opened, the system can be registered.
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One can also convert data from previous version of My Business to My Business Version
3. Data can be converted from two places: on the Open Company screen and within the system
by selecting My Business button, followed by the Data Conversion. I f one converts on the Open
Company screen, the first step is to select the Convert button on the Open Company Screen. A
new screen will appear but just select the next button to continue. Another new screen will
appear to ensure that the current data is backed up before starting the conversion. Then, select
Pastel Invoicing, Pastel My Business Version 1 or Pastel My Business Version 2. After that,
enter a new company name for Pastel My Business Version 3 in the company name, then select
next to continue. If one wants to auto allocate transactions to the oldest invoices in the Version 3,
check the Set all customers and suppliers to use auto allocate to oldest invoice check box. Then,
select the Next button to continue and a screen is displayed. Then, click the Next button and
when the conversion is completed, select the Finish button.
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2. Working with Companies
Opening and Maintaining Companies
Once the system is started, a company is opened; therefore, one needs to select the
company and enter its password if there is one. When a new company is created, there is no
password. A company can be created from two places: In the Open Company window by
clicking the New button or in the home screen by choosing the My Business button and Create
Company menu option. If a companys data is no longer needed, it can be deleted. Once the
companys data is deleted, its information is irretrievably lost.
Company Details
Upon creating a new company, the system invokes the Company Details wizard. The first
step is to select the Company Details option. Then, enter information that prints on documents
such as invoices in the Company information Screen. If a new company is being created, the
Financial Year and Tax Systems screen will appear and one should set up the tax processing
rules in accordance with the rules of the country. In the Rounding Settings section, one can set
the system to round customer invoices. In the Regional Settings section, one can set how many
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decimals the system should use. In the Document Setup section, one can choose whether the
system should warn the user if item quantities and costs fall below zero. The system calculates
and displays the ageing balances when statements are printed. In the Document Message Settings
screen, enter messages to display on documents and statements.
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Backup and Restore Companies
It is essential to make secure copies of the company data because the database which is
stored in the hard disk is subject to failures, physical damage and theft. To access this function,
select the My Business button and then select Back up/Restore Company.
Change Passwords
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When a new company is created, the system sets the password to be blank so that one can
enter the database easily. One of the first things to be done is to create a password for the
company by selecting the My Business button and Change Password.
User Defined Fields
When maintaining customers, suppliers, items and assets, one may want to store
additional information about each record over and above the information the system requires. To
do this, the system allows one to name 12 additional fields for each of the record types.
To access this function, select the My Business button and then select User Defined Fields.
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Four types of fields:
Field Type What You can Enter
Text You can enter an
alphanumeric description,
of up to 30 characters.
Numeric You can enter numbers.
Date You can enter dates.
Yes/No This is a check box, which
you can check or uncheck
Export/Import Company Data
Master file elements of the company data can be imported or exported. To access this
function, select the My Business button and Import/Export. Take note that prior to importing
data, the company must be backed up.
3. Working in My Business
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There are various elements in the system. Menus can be used to choose program function.
The working area displays a list of existing records, such as customers, items, and so on. The
screen displays best at 1024 x 768 but other sizes can be used.
Program Functions
Program functions are in logical positions within the menu system. By clicking on the
Home menu item, the company Dashboard is shown. In the Quick View Menu, customer,
supplier, item, account and bank account information can be viewed. In the Customer menu,
there is an access to any function that has to do with customers. In the Suppliers menu, there is
an access to any function that has to do with suppliers. In the items menu, any function regarding
items can be accessed. In the Banking menu, bank and credit card accounts can be maintained. In
the Accounts menu, expense accounts can be entered and monitored. In the Accountants Area,
reports and functions which are part of an accounting function are found. In the Asset menu,
assets can be maintained. In the reports menu, variety of reports can be selected to be printed or
to be emailed. The Help menu option is an access to the User Guide.
Processing Transactions
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Transactions are processed through document screens and grids in My Business. Data
such as numbers and texts are entered into the system in standard ways. The data entry elements
include selecting records from a list, entering dates and working in data entry grids. Master
records or static records can be created in the system. Record selection fields have a drop-down
arrow which can be clicked. This is how it works: Click an item to select it, then to add new item
click on the Add New Item option to open the applicable maintenance screen which is to be
completed with Customer, Supplier, Item, Bank or Account details. Finally, click the Save
button. The sequence can be set in which My Business places the day, month and year in the Edit
Company screen. When entering the date, one can choose a date from a calendar called a date
picker or enter the day, month and year as separate fields. Data entry grids are tables used to
enter invoices lines. The Tab key can be used to move to the next column. To move to a new
line, press Tab on the keyboard. To delete a line, click on the x button at the end of the line that
should be deleted. To edit lines, click on any fields.
Record Tables and Drill Down
The system displays lists of records in a table. Record tables are powerful tools to sort
records and select the columns to be viewed. The tables work in the same way irrespective of the
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information they are displaying. To open the records, double click the records. By clicking on the
arrow to the right of each of the headings, a customer can be selected to be viewed.
Drill down is a feature that lets the user click on a graph or a total and see the transactions
that make up the total value. Drill down is a multi-level that takes the user right down into the
original transaction. The user can click a days value and see the transactions that make up that
value. By clicking the magnifying glass on a transaction line, the original invoice can be seen.
The user can drill down just anywhere where a graph or balance can be seen.
Maintaining Master File Records
Master file records contain static information like customers, suppliers, items and their
respective categories. The user can maintain these records via their respective menus. To edit a
customer account, List of Customers from the Customer menu is selected. Then, a list of existing
records is displayed. These are record tables, which allow sorting, grouping and filtering. To add
a new record, click the Add button. To edit an existing record, double click on the line desired to
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be edited. To delete a record, select the x button on the line desired to be deleted. There are four
tabs that can be edited: Contact Details, Additional Contacts, Notes and User Defined Fields.
The other three tabs are completed by My Business using transactions that were processed:
Activity, Quotes and Unpaid Invoices.
Notes, Messages, Descriptions, Comments
Notes can be created for Customers, Suppliers, Items, Accounts and Banks and Credit
Cards. These notes can be open ended. When the Note tab is clicked, a note line is automatically
added. The note can be edited by clicking the fields. However, the Entry Date cannot be edited.
When documents or transactions are entered, additional text for the document or with
each transaction can be entered. For documents such as quotes, purchase orders and invoices,
these are called messages. For supplier payments, customer receipts, and write-offs, they are
called descriptions. If standard messages are set up in the documents, the message field can be
used to enter a message specifically for the document that one is working on. To add the
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message, select the Add Message button. To add standard messages, select . In the Code
field, enter the message to be displayed in the Message field. Then select the OK button and
select the message to be displayed followed by the Select button.
Filter and Searches; printing, Viewing, and Emailing Reports
On all the maintenance screens, there are Search and View fields. They allow one to
search for specific master files and documents. The View field contains specific system default
filters that can be used for more advanced searches.
Reports are printouts from the system. They can be exported into many different formats.
In addition, they can be emailed to anyone as long as there is an e-mail software running on the
workstation and the recipients email address is known. Each report window has the following
elements: (a) The Report Filter which displays options specific to each report. (b) The Report
Options section which gives options common to all reports. (c) The Print button which prints
report. (d) The Preview button which allows the report to be viewed in the screen. (e) And, the
Email button which lets the user quickly e-mail the report.
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4. Editing Master Files
Customers
Customer categories can be created and then analyzed per category. To create new
category, click on the Add Customer Category button. Customer records are maintained in order
to sell items to customers. This function can be accessed by selecting Customers, then List of
Customers. To edit a customer account, double click on the customer record line. In order for the
system to automatically allocate the customers receipts to the oldest invoices, the following tabs
can be edited: Contact Details, Additional Contacts, Notes and User Defined Fields. The other
three tabs which are Activity, Quotes and Unpaid Invoices can be completed by using
transactions that have been processed. The Activity tab summarizes the financial activity with
the customer. The Additional Contacts tab lets one enter contact details for persons in the
customers company. In the Notes tab, notes for the customer can be entered. In the User
Defined Fields tab, additional fields can be entered. In the Quotes tab, the quotes for the client
can be seen. In the Unpaid Invoices tab, unpaid invoices for the customer can be seen.
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Suppliers
Supplier categories can be created to be analyzed. To access this function, select
Suppliers and then select Suppliers Categories. Supplier records can also be maintained and the
records can be accessed by selecting Suppliers, then List of Suppliers. When one adds or edits a
supplier, the Edit Supplier window opens. In the Contact Details tab, postal and physical
addresses as well as contact details are entered. The Activity tab summarizes the financial
activity with the supplier. The additional Contacts tab allows the user to enter contact details for
persons in the suppliers company. In the Notes tab, notes are entered for the supplier. In the
User Defined Fields tab, additional fields can be entered. In the Purchase Orders tab, purchase
orders that have been processed for the suppliers can be seen. One can also drill down to see
details. In the Unpaid invoices tab, the unpaid invoices for the supplier can be seen.
Items
Item categories can be created and then analyzed. This function can be accessed via
Items, then Items Categories. To create another category, click on the Add Item Category button.
In this function, one can maintain records for goods and services. Sales and purchases statistics
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can be viewed. This function can be accessed by selecting Items and then List of Items
(Inventory). When an item is added or edited, the Edit item window opens. One can use service
items to sell maintenance contracts, consulting hours and so on. For new items, opening cost and
quantity values can be entered. In the Activity tab, one can drill down to the original document
by clicking on the magnifying glass. In the Price fields, exclusive and inclusive selling price is
entered. In the Notes tab, notes are entered for the item. In the User Defined Fields, additional
fields can be entered.
Bank and Credit Card Accounts and Accounts
Bank and credit card categories can be created. This function can be accessed via
Banking then Bank and Credit Card Categories. To create a new category for bank accounts,
click on Add Bank Account Category and enter the name of the new category. Bank and credit
card accounts can be used to: (a) receive payments from the customers, (b) pay suppliers, (c)
make incidental payments, (d) receive cash from other sources, and (e) process tax payments.
This function can be accessed by selecting Banking and then List of Banks and Credit Cards
menu. Details are then entered in the Bank and Credit Card Account. In the Notes Tab, notes for
the account are entered. In the Activity tab, the summary of the bank accounts activity can be
seen.
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Accounts can be used to analyze transactions entered in the Bank and Credit Cards
function as well as Journal Entries captured in the Accountants Area. This function can be
accessed by selecting Accounts and then List of Accounts. One can also edit or add an account
item. If a new account is created, there are several financial categories to choose from. They
include Cost of Sales, Expenses, Non-Current Assets, Current Assets, Non-Current Liabilities,
Current Liabilities, Owners Equity, Income Tax and Other Income. Once transactions are
recorded against an account, the category cannot be changed. Assets can be created separately
using the Assets menu option.
5. Processing Transactions
Selling and Purchasing Items
When selling to customers the following documents are involved: Quote, Invoice and
Customer Return. When purchasing from suppliers these documents are needed: Purchase Order,
Supplier Invoice and Supplier Return. These functions can be accessed in the menus. To setup
recurring invoices, select Customers then Customer Recurring Invoices. Customer Statement
Run option is used to generate customer statements and deliver it to customers using distribution
methods. The typical invoice window has four sections; the header section where customer and
supplier account is chosen, the lines section where items are entered, the footer section where
messages are entered, and the options section at the bottom of the screen which are Process
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Receipt, Process, Process and New and Print. Once the document is already printed or emailed, it
cannot be edited anymore.
Receiving and Making Payments
After purchasing from the suppliers and then selling to customers, payments must be
received and made. These are the processes: pay a supplier, receive money from a customer,
write-off amounts if customer cannot pay and process receipts and payments from and to
customers and suppliers via the bank and credit card transactions option. If a customer returns
items or the business returns items to the supplier, Customer Return or Return Items to a
Supplier is created to reverse the invoice, adjust the inventory quantities and update the balance.
These functions can be accessed by selecting Customer Receipts or Supplier Payments options,
or use the Process Banks and Credit Cards, or process account receipts and payments.
Bank and Credit Card Transactions
Account payments and receipts, customer receipts, supplier payments or refunds can be
processed using this function. In order to process customer and/or supplier receipts and/ or
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payments using this function, there is a need to allocate the receipts and payments under the
customer and supplier menu options unless one has selected to auto allocate receipts or
payments. This function can be accessed by selecting Banking and then Process Banks and
Credit Cards. In the Payments tab, account supplier and tax payments are processed. In the
Receipts tab; account, customer receipts and tax refunds are processed. If the user shows
previous transactions and the user edits an existing Customer Receipt or Supplier Payment, any
allocations made on the receipt or payment will be removed and there is a need to re-allocate
transactions. My business automatically remembers which Account, Customer or Supplier to use
based on the description entered while processing the bank and credit card transactions. If the
user enters a description that My Business recognizes, the system will automatically complete
the type of transaction and account, customer or suppliers selection for the user. The mapped or
completed transactions display in light grey and the new transactions display in black.
Import and map Bank and Credit Card Statements
My business allows the user to import bank and credit card statements that were
downloaded from the Internet, either in OFX or CSV format. The mapped or completed
transactions display in light grey and the new transactions display in black.
Reconcile Bank and Credit Cards
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Payments and receipts may be processed via one or more bank accounts. These bank
accounts can be reconciled against the bank statement. The reconciliation process does not affect
any values on the system and its use is optional. This function can be accessed by selecting
Banking and then Reconcile Banks and Credit Cards.
Allocations
The business sells to customers via invoices, and the customers pay via receipts. In
addition; discounts, returns and write-offs can be processed. There is a need to match each
receipt, payment and write-off to a customer or supplier invoice. The best time to do the
allocation is when actual payment is entered. When the transaction is entered, one can allocate it
to the correct invoice. To allocate a receipt as it is processed, the line for the document record
which is to be allocated is clicked. To allocate receipts and payments after processing them, the
Allocate Receipts and Allocate Payments menu options are used.
Item Adjustments
When a new item is created, the opening cost price and quantity on hand is entered.
Thereafter, the quantity adjusts as the items are purchased and sold. The cost price also adjusts as
the items are purchased. The system calculates a new cost price using average costing each time
an item is purchased. Item Adjustments can be used to correct errors as well as to make
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percentage adjustments to selling prices for a range of items. To access this function, select Items
and then Item Adjustments.
Adjust Opening Balances
When creating a customer, a supplier, bank or credit card accounts and an account, the
opening balance and date are entered. Once any transactions for the record are processed, the
opening balance fields cannot be changed. To access this function, select the Adjust Opening
Balances option from the Customers, Suppliers, Banking and Accounts menu options.
Accountants Area
Accountants Area is exclusive for accountant processing such as Journal entries and Tax
Adjustments. These functions can be accessed by selecting the Accountants Area menu option.
In the Process Journal Entries, accounts can be increased or decreased and select to add an
affecting account.
My Business calculates the tax. The input tax is calculated by working out the tax
included on all the supplier invoices that were processed. The output tax is calculated by working
out the tax included in all of the customer invoices that were processed. The difference of the
two is the amount of tax owed by the company. In the Detail screen, the date for the transaction
and the bank account that will be affected as well as the amount are edited. In the Tax adjustment
screen, the input tax and the output tax can be adjusted.
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Accountants reports are available. They include tax reports, tax audit reports, trial
balance, opening balances and tax adjustment report, audit trail and tax payments and refunds
report. In My Business, the trial balance can be exported to a CSV file. To export the trial
balance, the date range and viewing options can be specified. Then the Export data button is
clicked. To assign account numbers, the Assign Account Numbers button is clicked. The system
will return to the Trial Balance Export screen, then, the Export data button is clicked.
6. Enquiries and Reports
The Company Dashboard
The Company Dashboard shows some key facts about the business. The To Do List
shows due and overdue customer and supplier invoices, expired quotes and overdue notes. The
Banking widget summarizes the bank account activity and gives the user an option to import the
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bank statement. The Sales History shows a graph of total sales for this year and per month. The
Top Customers by Sales shows the top value customers. This function can be accessed by
selecting the Home menu option. Each element of the Company Dashboard can be drilled down
and the user can customize some of the elements for more information. To add more graphs to
the Dashboard, the Manage Widgets and then Views are clicked.
Quick Views
Quick View menu lists the different types of information which can be viewed. First, the
master file should be selected from the menu and then the Quick View screen details the latest
transactional activity on the selected master file record. The running balance displayed represents
either an outstanding balance and/or current balance for the selected master file record. The
documents can be printed or emailed by clicking on the Select All button. But if only selective
documents are to be printed, there is a check box to be checked next to any document or
transaction.
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Reports
There are several reports available in the Reports menu. The Customer Reports include
List of Customers, Sales by Customer, Customer BalancesDays Outstanding, Customer
Statements and Customer Transactions. The Supplier Reports include the List of Suppliers,
Purchases by Suppliers, Supplier BalancesDays Outstanding, Supplier Statements and
Supplier Transactions. The Item Reports include the List of Items, Sales by Item, Purchases by
Item, Item Movements and Item Valuation. The Bank and Credit Card Reports include List of
Bank Accounts, Bank Account Transactions, Cash Movements and Cash Flow Report. The
Account Reports include the List of Accounts and Account Transactions. The Tax Reports
include the Tax Report, Tax Payment and Refunds and Tax Audit Report. The Financial
Statement Reports include the Profit and Loss Report, Statement of Assets and Liabilities Report
and Trial Balance Reports. The Asser Reports include the Asset Register Reports. Finally, the
Other Reports include To Do List Reports and Audit Trail Reports.
My Business allows the user to customize the following: Customer Documents and
Statements and Supplier Documents and Statements. On the report screen, the Layout tab is
selected. The user can select layout. Using the Standard Controls, Report Explorer and Field List,
the fields on the layout can be added, moved or edited. The report can be viewed by clicking the
Preview button.
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IV. Internal Control Structure
As an accounting software for small and medium-sized companies, Pastel My Business
caters to the need of businesses for reliability of data processed and information reported. This
reliability is very important for a business entity in order that management can make proper
decisions to meet its ultimate goal of maximizing profits. With this, Pastel My Business is
integrated with internal controls that help achieve specific company objectives.
The primary purpose of this section is to describe application controls which meet the
following control objective: preventive objective, detective objective, and corrective objective,
possibly from the preparation and input of data to the processing, correcting and finally, delivery
of output in the form of reports.
Application controls, however, are influenced by the strength of general controls. As
general controls are not entirely captured and provided by the accounting software, the general
controls shall only be referenced alongside the discussion of application controls.
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A. Preventive Controls
Preventive controls are those which prevent the occurrence of errors and discourage the
commitment of fraud. In Pastel, the following preventive controls are found:
User Procedures Manual
The software has a thorough, simple and clear step-by-step User Guide complete with
definitions, functions, screen shots and lists which teaches and explains to the user how the
system is utilized. The User Guide has six main chapters, namely: Getting Started, Working with
Companies, Working with My Business, Editing Master Files, Processing Transactions, and
Enquiries and Reports. The contents of this guide are the basics in using Pastel, and do not
include the so much details. The processes undertaken, the fields to be filled up, and the purpose
or use of reports and functions.
This User Guide can also be viewed instead as a Navigation Guide in the computer as a
presentation rather than reading it in hardcopy.
Source Document Design
The source documents of the software are editable. Therefore, the user can adjust and
design a better document format which corresponds to greater internal control. For instance,
additional fields for footing and cross-footing purposes can be added to the document design.
The company logo, header and other details can also be edited.
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In the Invoices printed, the software automatically includes in the documents the details
and information about the parties related in the transactions. Example of these information are
addresses, contact numbers and tax numbers.
Prenumbering
Each processed transaction has a document number which is automatic but can be
changed. The automatic prenumbering follows the last previous number assigned to a
transaction. Thisprenumbering feature is present in the Purchase Order, Suppliers Invoice, and
Tax Invoices as well as in the Supplier Return and Payments, and Customer Returns and
Payments.
These document numbers appear in the reports printed by the system as references.
Actually, these same document numbers can serve as batch numbers for every batch input.
Forms Security
In the records for Supplier, Customers, Items and transactions, it is reflected when such
record has been printed already by having a check in the column Printed. This is a security in the
forms and documents since it signals to the user and keeps track of the documents that have been
transformed into hardcopy. The record can again be printed.
Identification of Preparer
A username and password is required in order to enter the system. However, once a user
has entered the system. No other identification of preparer is required.
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Evidence of Approval
In the records of Customers, Suppliers, Items and Account, these records cannot be
deleted unless all activities are settled, including payment of invoices and receipt of payments
from customers, or if the balance remains zero.
The system will warn you that a Customer, Supplier, Item or Account has an activity,
which means that is part of an unsettled transaction. Unless all these activities are settled, the
system will never allow you to delete a Customer, Supplier, Item or Account.
In other transactions which go beyond set limits, example in the Credit Limit, the system
will warn the user if he wants to proceed with the transaction. By confirming the question, the
user can then go on.
B. Detective Controls
Detection controls are designed to detect those errors that inevitably occur despite
preventive controls. These controls ensure that unreliable, improper, unauthorized, invalid, or
lost data and transactions are detected.
Batch Controls
Batch identification numbers
For every batch of transactions processed, a batch number is assigned through the
document number. Also, a reference number is assigned for the batch. This number can come
from the Invoice or source document numbers before data entry.
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Control totals
Totals are provided for each category of amounts. For instance, in a report Purchases by
Supplier, there are totals for a document number, for a supplier, and finally a grand total. This
allows an easier review and footing of totals.
Sign tests
Sign test does not exist for Quantity and Price exclusive of tax. For Discount Amount, if
a negative number is entered, the entry is invalidated and the discount goes back to zero.
In some fields for amounts, negative numbers can be entered as correction to an error in a prior
transaction. This is the correcting mechanism of the system.
Alphanumeric condition tests
Alphabets cannot be entered in the fields for amounts. The value goes back to zero if
there is an attempt to enter a non-digit number. In some fields, the system just does not read the
attempt to enter, meaning the value does not change at all.
Limit test
If a customer exceeds the credit limit, the system will require a confirmation but one can
easily proceed by selecting YES.
The number of decimal places for a particular amount can also be set by the user in the
very beginning. Upon setting up, the system asks the user what will be done to the excess
decimal places. One can choose to round up or round down.
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Batch Input
The system does not allow the user to proceed with the processing and to enter data in the
other fields unless a principal required field is filled up.
In Adding a new Customer, Supplier, or Item, the user must first fill up the name of the
Customer or Supplier and the description of the Item, only then can the user proceed to fill up the
other fields.
In processing an Invoice, the user cannot enter the Quantity and Prices without putting an
item description.
Sequence test and Anticipation Control
The sequence follows the sequence of the document number, displaying the most recent
at the top.
The anticipation control is present in the creation of a Suppliers Invoice, when the user
tries to enter or link a Purchase Order with the invoice through entry of a P O number and this
PO does not exist, the entry will be rejected and the field will go back to blank.
Field presence check
There are required fields that must be filled up before one can proceed to process a
transaction. In creating a new Supplier, Customer or Item, the name of the supplier/customer or
the description of the item must first be entered so that one will be able to fill up the other fields
and save the data. The presence of a field is necessary to be able to go on with the transaction.
Also, in a Payment transaction such as payment to a supplier, a bank account must be
entered before one can process the payment. This is the same with the purchase or sale of items.
Unless an item description is entered, the fields Quantity and Price cannot be changed and one
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cannot proceed with the transaction. In the correction and adjustment of an incorrect and
erroneous balance, the field for Reason must first be filled before one can go on entering a new
balance.
C. Corrective Controls
Correction controls ensure that errors that are detected will be properly corrected and
resubmitted for input and processing.
Error Correction Procedures
In the Users Guide, there are instructions for error corrections and adjustments of
incorrect data entries. This part of the manual explains the kind of error, the manner of how this
error can be corrected and the procedures to be followed.
Error Log
For system errors and failures, a log is created by the system which is saved in the
computer folder. This log provides a very detailed list in the errors encountered by the system,
including start up failures and loading errors.
Audit Trail
In the Reports, an Audit Trail can be printed. This is a summary of all transactions
processed by the system for a period. The period can be selected by the user within specific
dates. The Audit Trail contains the events, dates, time, reference sources, prices and tax effects.
However, it does not include the person accountable or the preparer of the transactions listed.
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This audit trail classifies the transactions by nature: Account Payment, Account Receipt,
Opening Balance Adjustment, Quotation, Customer Tax Invoice, Journal Entry, Supplier
Invoice, Supplier Purchase Order, Supplier Return, Transfer-in and Transfer-out. It also
identifies by event such as created, updated or deleted.
Reverification
The system prompts the user by warning through a dialogue box that an error is being
made by the user. The user has to enter the transaction in a correct way again.
Control Totals Adjustment
The errors in My Business are corrected through editing the data in the record or a new
entry with a negative amount can be entered to correct an erroneous prior transaction.
For opening balances, however, the balances can only be edited through the Adjust Opening
Balance function while the errors in the quantity of items, costs and selling prices can only be
adjusted in the Item Adjustment function.
V. Comments and Discussions
Features
One of the outstanding features of Pastel MyBusiness is that it has a very clear step-by-
step navigation guide complete with screen shots which can be printed and used as a procedures
manual. The user guide contains several modules which can assist the user on how to use the
software. Moreover, the modules are step-by-step. The first module discusses on how to get
started. Then, the second module focuses on working with companies which already the lesson
proper. It is then followed by Working in My Business, Editing Master Files until Enquiries and
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Reports. It is really appropriate that they discussed Reports in the last module because in actual
practice, reports are the outputs which are important for decision-making.
Regarding the general features of the software, it has the VAT report for the VAT
submissions which is very important for the company to know its VAT balances to be paid.
However, the user of the software must make sure that the correct tax rates must be entered;
otherwise, they can be criminally liable to the government. The Asset Register Report is also
useful so that the company can keep track the value of its total assets. This will also help them
when preparing the balance sheet. The Bank Reconciliation feature of the software is also useful
to check whether there are discrepancies between the book balance and the bank balance. In the
systems powerful Dashboard, the top selling items is shown which can aid the company
regarding what to sell more in the future. The company may eliminate the product-line with the
least sales and focus more on the most popular product line. The sales/purchases history graph is
also significant for the entity to know the trend and fluctuations of their sales amounts and
purchases amounts.
Internal Controls
There are three important internal controls discussedby Auditing EDP Systems by
Watne and Turney. They are the preventive controls, detective controls and the corrective
controls.
Preventive controls should be applied in data capture, batch data preparation and batch
input. For data capture, Pastel My Business has no problem regarding User Procedures Manual;
however for Source Document Design, Prenumbering and Forms Security, there are some
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problems. For the Source Document Design, there are no boxes or area for authorization
signatures and reference number is not compulsory. This might lead to unauthorized personnel to
interfere. Ideally, there should be a box or area where a person can place his signature to avoid
problems. Moreover, although dates are automatic, there is no date of printing. The date of
printing is very important as evidence to show the timeliness of the report. Without the date of
printing, the user might adjust or estimate the date; therefore the date of printing is vital. For
Forms Security, the person who printed and filled up the form is not reflected. This might cause
confusions regarding who is responsible for the report. Regarding the Evidence of Approval,
Customers, Suppliers, Items and Accounts cannot be deleted unless all activities are settled,
including payment of invoices and receipt of payments from customers, or if the balance remains
zero. This feature can prevent accidental deletion of some important items. Going to the Batch
Data Preparation, sales invoice amount can be changed anytime even if prepared for an earlier
time. This means that if a person accidentally changed the amount of the sales invoice, then the
records would be effected which would lead to conflicts between customers. Therefore, it would
be better if sales invoice amount is changeable only after a series of confirmations.
Going to the detective controls, there is a problem regarding Key Entry Validation
because the Sign test does not exist for Quantity and Price exclusive of tax. This means that there
can be negative signs for Quantity and Price exclusive of tax. Sign test should apply to all items
which have amounts. Regarding their limit test, if a customer exceeds the credit limit, the system
will require a confirmation letter but one can easily proceed by selecting Yes. Since limit test is
very important, it would be better if after selecting Yes, another question should be asked which
is Are you sure? The purpose is to verify whether the user is really willing to take the risk.
Regarding discount amounts, if negative number is entered, the entry is invalidated and the
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discount goes back to zero. This is a good control. For the batch input, the software has a very
good sequence test since the sequence follows the sequence of the document number, displaying
the most recent at the top.
For the corrective controls of the software, there is a problem in Audit Trail. Although a
summary of all transactions processed by the system can be printed and the period covered can
be adjusted, it does not include the person accountable or the preparer of the transactions listed.
This means that although fraud can be identified, the person responsible for the fraud cannot be
identified. It is indeed a must that the name of the person accountable for every transaction must
be stated. For batch data preparation, there is an error log for the errors encountered by the
system which explains the source of the error. This is useful because the source of the error is
identified and if the source of the error is eliminated, the problem is solved.
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VI. Reference
http://www.sagepastel.com/
http://www.pastel.co.za/Accounting-Software-Products/My-Business.asp
http://www.ggaccounting.co.za/pastel-my-business
http://www.pastel.co.za/Accounting-Software-Products/My-Business.asp
http://www.sagepastel.com/Sage-Pastel-Software-About-Us.asp
http://www.sagepastel.com/Sage-Pastel-Software-Become-Business-Partner.asp
http://www.sagepastel.com/Sage-Pastel-Software-Newsroom/Related-Articles.asp
http://www.sagepastel.com/Sage-Pastel-Software-Development-Kit-SDK/Index.asp
http://en.wikipedia.org/wiki/Softline
http://www.cloudave.com/1382/pastel-my-business-online-review/
http://allafrica.com/stories/201110211380.html
My Business User Guide
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