Prepare a system flowchart - systems analysis, Accounting Basics

GILCO rents DVDs and DVD players (players) on a short term basis to airline passengers through GILCO locations at every large commercial airport throughout the world.  A passenger can rent a DVD in any one of 50 popular languages and/or player at one location and return it at any other GILCO location anywhere in the world. GILCO rents a player containing special batteries which provide up to 24 hours of continuous viewing operation without recharging.  This is very convenient on long international flights. The DVDs are unique in that the customer specifies the movie and the language in which he/she prefers the dialogue to be recorded.  The GILCO system copies the movie with the dialogue in that language to a blank DVD.   

Before a customer can rent a DVD or player, he/she must register with GILCO.  Registration is free, but each customer must hold a valid major credit card in his or her own name to be eligible to join, as all payments must be made by credit card. To register, a customer enters the following information into the  system at a terminal which is available at all GILCO  locations:

  • First name
  • Last name
  • Date of birth
  • Current date
  • Street address
  • City
  • State (or equivalent)
  • Zip code (or equivalent)
  • Country
  • Phone number
  • Major credit card type
  • Credit card number
  • Drivers license number (or equivalent)
  • Language in which the customer wants
  • information to be provided to him/her

The central  GILCO system in  Tulsa, OK  verifies the credit card and the customer information through the accessing of a number of online databases.  If approved, the customer is directed to sign a digital signature pad.  The system then prints out a laminated GILCO registration card for the customer.  The account information becomes available online at all  GILCO locations throughout the world through the central information system at corporate headquarters in GILCO.  Now the customer may check out and return DVDs and players at any GILCO  location in the world. If the registration is disapproved for any reason, a message informs the customer of this fact through a message on the terminal screen.

Customers are limited to a total of  six DVDs being outstanding at any one time.  To rent a DVD, the customer browses the movie list at a GILCO location.  The customer inserts the membership card into the terminal at the GILCO location.  A screen is pulled up containing that customer's information, including any balance due.  If there are any late charges, they must be paid before any additional DVDs may be checked out.  The screen also prompts for the serial numbers of up to six DVDs to be checked out, along with the language that the customer wants the dialogue to be in for each movie. As indicated earlier, the maximum number of DVDs that can be outstanding to any customer at any one time is six from all GILCO  locations. The system keeps track of the number of outstanding DVDs per customer.  The system computes the balance due, including any outstanding late charges. The customer inserts his or her credit card into the terminal, enters any required codes (such as PIN) and authorizes the transaction.  Once the transaction is approved for the credit card, the system copies the movie(s) to blank DVD(s) in the language(s) specified by the customer.  When the copying process is complete, a message appears on the attendant's terminal directing him/her to remove the DVDs from the DVD copier.  The attendant then places each DVD in a jewel case and delivers them to the customer.

When the customer returns the DVDs at any location, he/she places them in a return bin. At a convenient time, the attendant removes them from the return bin and enters them into the computer system as returned so the customer will not be charged for additional time. If the DVDs are late, a late charge is computed and added to the customer's account balance.  Later, the attendant erases the movie recorded on the DVD so the now blank DVD can be reused.   


The checkout procedure for players is similar to that for renting DVDs, except that the customer has to sign a contract (because of the high value of the player).  The customer inserts his/her registration card into the terminal, and the customer record is pulled up.  The amount due is generated by the system. Then the attendant enters the number of the player and a contract is generated.  The customer signs a contract via an electronic signature pad. The electronic contract is maintained online in an active contract file.  The player is retrieved from storageby the attendant and given to the customer along with a copy of the contract.   When the player is returned, the contract is accessed electronically, the return is annotated on the contract and a copy is provided to the customer. The annotated electronic copy of the contract is moved electronically from the active contract file to an inactive contract file.  The customer account is updated with the return information, and any late charges are added to the customer balance.  The payment by credit card is handled just as with the rental of DVDs.

GILCO uses an online real time processing system.  As each transaction is entered, from any location in the world, the master files are updated instantaneously at the central computer system located at the GILCO corporate headquarters in Tulsa.

The corporate information system generates 4 reports for management each week. The first report lists all the unreturned DVDs and players alphabetically by customer name.  One copy of this report is sent to the President and another copy to the Controller. The Controller department uses this report to manually prepare letters and send them to customers who have not returned items. The letter urges them to return the items to any GILCO location as soon as possible and spells out current and future charges and actions.  If the items have not been returned after two weeks from the date of the letter, the account is forwarded to a collection agency, the customer is dropped as a member, and notification is provided to the credit bureau (this affects the customer's credit record).

The second report shows profitability by each airport location, geographic region and system-wide.  One copy of this complete report is sent to the President, the Controller and the Vice President of Marketing. A report for each region and airport within the region is sent to the regional manager for the respective region.

The third report lists the revenue generated by each movie title for the week, by language, airport location,  region and system-wide. One copy of this complete report is sent to the President, the Controller and the Vice President of Marketing.  A report for each region is sent to the regional manager for the respective region.


1.  Prepare a 3 column table, with the columns labeled from left to right as follows:

Inputs, Processes and Outputs.  Identify each of the processes involved in the Fly&Play system along with the inputs and outputs associated with each process.

2.   Prepare a system flowchart, following good flowcharting practices including annotations, documenting the GILCO system  as described above.  Use VISIO or another flowcharting tool of your choice.

3.   Included in the system description are a number of items which are illogical, represent  inefficient operations, violate good  internal control procedures or just violate good business practices.  I want you to identify these items and make recommendations for modifying the system to correct them.  This may include, but is not limited to, recommending system design changes or additional reports for management to improve decision-making.  Be sure to justify your recommended changes.

4.   Provide a modified 3 column table and system flowchart (items 1 and 2 above) reflecting your recommended changes from item 3.

5.    If you have to make any assumptions (you will), be sure to document them and justify why you made them.

6. Prepare a title page with the class number & name along with your name and staple the package in the upper left hand corner.  A cover is not required nor desired.

Posted Date: 3/26/2013 8:30:40 AM | Location : United States

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