Production Cycle
Presented by: Group 10
Introduction
The production cycle is a recurring set of business activities
and related data processing operations associated with the
manufacture of products.
INPUT
Revenue Cycle
Expenditure Cycle
Human Resource/Payroll Cycle
PROCESS
Production Cycle
OUTPUT
Revenue Cycle
Expenditure Cycle
Human Resource/Payroll Cycle
General Ledger and Reporting System
Activities in the Production Cycle
Production Cycle Activities
Product Design
Planning and Scheduling
Production Operation
Cost Accounting
Key Documents and Forms in Product Design
Bill of Materials
Operations List
Approaches to Production Planning
Manufacturing Resource Planning (MRP-II)
develops plans for up to 12 months ahead.
Lean Manufacturing
uses shorter planning horizons.
more appropriate for products with predictable demand and a long
life cycle.
more appropriate for products with unpredictable demand, short
life cycles, and frequent markdowns of excess inventory.
Master production schedule
Materials requisition
Production order
Key Documents and Forms in Planning and Scheduling
Move ticket
Types of Cost Accounting
Job order costing
Process costing
Cost Accounting system
Raw materials
Direct labor
Machinery and equipment usage
Manufacturing overhead
Control: Objectives,Threats, and Procedures
In the production cycle (or any cycle), a well-designed AIS
should provide adequate controls to ensure that the following
objectives are met:
All transactions are properly authorized.
All recorded transactions are valid.
All valid and authorized transactions are recorded.
All transactions are recorded accurately.
Assets are safeguarded from loss or theft.
Business activities are performed efficiently and
effectively.
The company is in compliance with all applicable laws and
regulations.
All disclosures are full and fair.
What are some threats?
unauthorized transaction
theft or destruction of inventories and fixed assets
recording and posting errors
loss of data
inefficiencies and quality control problems
What are some control procedures?
accurate sales forecasts and inventory records
authorization of production
restricted access to production planning program and to blank
production order documents
review and approval of capital asset expenditures
documentation of all internal movements of inventory
proper segregation of duties
source data automation
online data entry edit controls
backup and disaster recovery procedures
regular performance reports
cost of quality control measurement
