Session 3

FLOWCHARTING

Session 3 ICS Seminar 1

 OBTAINING AND
RECORDING AN
UNDERSTANDING OF
General Approach
THE ICS
in Conducting an
INTERVIEW
FLOWCHART
CONFIRMING THE
UNDERSTANDING OF
ICS Evaluation
ICS POLICIES &
NARRATIVE PROCEDURES

WALKTHROUGH CONDUCTING
PRELIMINARY
EVALUATION OF THE
ICS

YES ASSESSING
ICQ
CONTROLS

NO TEST OF CONTROL
WORKING PAPERS REPORTING

SUMMARY OF SUMMARY OF
CONTROL CONTROL
WEAKNESSES BREAKDOWNS SYSTEMS REVIEW
OBSERVATIONS
Session 3 ICS Seminar 2
SCW – Summary of Control Weakness
Return to Page 2
CC – Compensating Control
 FLOWCHARTING
is an analytical technique used
to document a system of internal
control in a clear, concise and
logical manner, showing the
movements of documents
through various steps from their
origin to their final disposition
Session 3 ICS Seminar 4
 FLOWCHARTING
is used to illustrate by means of
symbols, the procedures, forms,
records and reports handled in each
position and charts the flow of forms,
records and reports within the position
and from one position to another
– to show the movements of documents
from their origin to their final disposition

Session 3 ICS Seminar 5

 ADVANTAGES OF A
FLOWCHART
1. Efficient.
– gives a bird’s eyeview of the
system.
– allows the reader to see at a
glance the series of procedures
and their interrelationships
– shows the origin of documents,
its processing, approval and
distribution
Session 3 ICS Seminar 6
ADVANTAGES (cont’d)
2. Gives a better
understanding of the system
– The exercise of preparing,
updating or reviewing
flowcharts gives the user a
better understanding of the
system. It also ensures that all
steps involved in the system
are looked into.

Session 3 ICS Seminar 7

ADVANTAGES (cont’d)
3. Provides a useful tool in the
review and evaluation of a
system
– it reveals opportunities for
improvements as well as non-
glaring deficiencies as:
– internal control weaknesses
– duplication of procedures and forms
– inefficiencies in procedures

Session 3 ICS Seminar 8

ADVANTAGES (cont’d)
• 4. Enables the user to
visualize effects of
changes in procedures in
case of proposed
Improvements in the
system.
• 5. Easier to update.

Session 3 ICS Seminar 9

 5 BASIC
ELEMENTS OF A
FLOWCHART
1. Heading
– Name of Agency
– Name of System (being
documented)
– Existing/Proposed Procedural
Flowchart

Session 3 ICS Seminar 10

 Elements (cont’d)

2. Areas of Responsibility
– defines the organizational
unit and the position of
personnel responsible for
the procedures being
charted

Session 3 ICS Seminar 11

ABC Company (Name of the Company)
Collection of Receivables (Name of the System) Heading
Existing/Proposed Procedural Flowchart

Finance Department (Department Involved)

Treasury Division (Division Involved)

Collection Section (Section Involved)

Cashier Concerned (Person Involved)

Area of responsibility
(Activities performed by the Cashier concerned)

Session 3 ICS Seminar 12

ABC Company (Name of the Company)
Collection of Receivables (Name of the System) Heading
Existing/Proposed Procedural Flowchart

Finance Department

Treasury Division

Collection Section

Collecting Officer Concerned Cashier Concerned

Area of responsibility of the Area of responsibility of the

Collecting Officer Cashier

Session 3 ICS Seminar 13

 Elements (cont’d)

3. Symbols
– used to show predefined items,
steps and actions

Session 3 ICS Seminar 14

 SYMBOLS

- Start of Flow

- Document (Form/Report)

- Items/Supplies

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 SYMBOLS

- Set of Documents

- Money/Check

- Record Book or any binded

document (e.g. cashbook,
logbook)

Session 3 ICS Seminar 16

 SYMBOLS

- Decision Box

- Permanent File

Session 3 ICS Seminar 17

 SYMBOLS

- Temporary File

A - On-page Connector (the

continuation of the process is found
on the same page)

- Off-page Connector (the

continuation of the process is
To Page __
found on the next page)

18
Session 3 ICS Seminar
SYMBOL (Computerized NAME DESCRIPTION
Environment)
Trigger It represents the start or end in a flowchart where the ending
trigger for the current procedure may be the starting trigger for
For Posting another procedure.

Line Connector It represents the directional flow of a routine or process in a

flowchart and connects each diagram.

Automatic Process It represents a process in a flowchart that is automatically

Post performed by the system.
Transactions

Manual Process It represents a process in a flowchart that is manually

Sign the performed by the user.
Document

Interface It represents a process in a flowchart where the user interacts

w/ the system, such as entering data or executing a routine by
Enter using the keyboards or mouse.
Transactions

Decision It represents a process in a flowchart where the system or

Yes No user makes a decision.
Proceed ?

View It represents a process in a flowchart where the user views the

View data thru the system (monitor screen).
Transactions

Data Transfer It represents a process in a flowchart where data is transferred

Upload from an external storage device (such as disk drives) to the
Records database or vice-versa.
 PHILIPPINE HOUSING CORPORATION
PROCUREMENT SYSTEM (Non-stock Items)

PREPARATION AND PROCESSING OF PURCHASE REQUISITION

Existing Procedural Flowchart
FC No. PROC-01

GENERAL SERVICES DEPARTMENT FINANCE MANAGEMENT DEPARTMENT

REQUISITIONING DEPARTMENT
PROPERTY DIVISION BUDGET DIVISION

SECRETARY PROPERTY CUSTODIAN BUDGET ANALYST

As the need arises Checks to determine

A B the PPR from which
Prepares the requisition is to be
from file -5- charged
-8- from file
1
ES -3- initials ES Indicates relevant ML
PR data in the PPR -6-
on CFA initials 1 assigns RFA No. RFA-CB
1-5 1-2
R/ILB on
PRCFA1,2,4,5 RFA-CB
ES 1-2 PR 1-5

Chief, Budget Division reviews PR and Posts the

initials on the CFA portion of PR details of
-9- the PR -7-
Dept. Manager signs on
'Requisitioned by' portion STOCKS YES Manager Finance Mgnt. Dept reviews
-2- from stockroom and approves on the CFA portion of
of PR and ES AVAILABLE
? PR
-10-

NO 4
PR ES
issue 1-2 PR
PR
S//M 1,4,5
1-5 PR PR 2
1-5
ES 1-2 ES 1
1-5
issues
ES 1-2
Requisitioner
A YES PR < 5,000? NO
Chief, signs on the 'Certified as
LEGEND: to non-availability of Stock'
portion of PR -4a-
PR - Purchase Request PR PR
ES - Executive Summary 1,4,5 1,4,5
R/ILB - Requisition & Issue
Logbook ES 1 ES 1
RFA-CB - Request for Fund Allot.
Control Book PR
ES OIC, GSD Asst. Administrator initials on
ML - Monitoring Logbook 1 -11a-
3 approves PR -11- 'Approved' portion of PR
CFA - Certificate of Funds Avail.
PO - Purchase Order initials
PR
ES 2 on1,2,4,5
CFA Administrator approves PR
12

To FC No. PROC-02 - Preparation

B & Approval of PO
08/08

Session 3 ICS Seminar 20

 Elements (cont’d)

4. Flowlines
– used to connect the
symbols in order to show
the action/flow of
activities and show its
relationship

Session 3 ICS Seminar 21

 FLOWLINES

- Flow of Documents

- Flow of Information/Basis of
Preparation

- Action Taken

Session 3 ICS Seminar 22

 Elements (cont’d)
5. Legend and Notes
– symbols used
– flowlines used
– acronyms used
– notes - narrative explanation of certain
items which cannot be adequately
described by the flow

Session 3 ICS Seminar 23

 PHILIPPINE HOUSING CORPORATION
PROCUREMENT (Non-Stock)

DELIVERY, RECEIPT, INSPECTION AND ACCEPTANCE

Existing Procedural Flowchart
FC No. Proc-03

GENERAL SERVICES DEPARTMENT

PROPERTY DIVISION

SUPPLY OFFICER STOREKEEPER

Upon receipt of delivery

assigns
from file
6 number
from file
from supplier 1 5
(Note 2)
PO
S/M
8 SI/DR RR
SI/DR RRF
1-2 1-5
1-2 2
PO PO 1
1 signs &
affixes date signs &
(Note 1) affixes date
3 signs & Chief, Property Div
8 7
affixes date Approves RR

RI 4

1-3

RR RR
2-5 1
RI RI RI SI/DR
SI/DR 1-2
S/M
3 1 2 1-2 PO 1
PO 8 PO 1

Resident ICO, Pre Audit Div Temporary

Auditor Treasury Dept Storage

RR
LEGEND:
2-5 NOTES:
S/M - Supplies/Materials
SI/DR 1-2
SI/DR - Sales Invoice/Delivery Receipt 1. Representative of ICO and the Supply
PO 1 PO - Purchase Order Officer inspect the goods delivered and
RI - Request for Inspection each of them affixes his signature on the
OIC - Officer-in-Charge 'Inspected by' portion of stamped on the SI
(Note 3) RR - Receiving Report while a representative from the office of the

Procedural Flow
RRF - Receiving Report File Resident Auditor observes.
Return to page 6
on DV Preparation 2. The assignment of RR number is based on
the last number issued on file.
Return to page 13
3. The Supply Officer informs the
Bird’ eye view requisitioning department to prepare two
(2) copies of Requisition & Issue Slip (RIS)
Return to page 27
for the issuance of the items requested.
Allows the reader to see the different procedures
Easy to understand,
08/08
easy to update, easier to notice ICS Seminar 24
any internal control deficiencies.
 GUIDELINES IN
FLOWCHARTING

• When the system being

documented is complicated
and subdivided into several
sub-charts, an overview
chart should be prepared to
summarize the whole system.
Session 3 ICS Seminar 25
 GUIDELINES (Cont’d)
• The number of
responsibility areas should
be restricted to maintain
clarity of presentation.
–Maximum - 6
–Ideal - 4
–Minimum - 1
Session 3 ICS Seminar 26
 GUIDELINES (Cont’d)
• Multiple downward arrows
should be used when copies
of forms are segregated for
disposition to different
recipients/files

Session 3 ICS Seminar 27

 GUIDELINES (Cont’d)
• Each copy of the document
must have a source and
must flow to either a:
– file symbol
– terminal symbol
– connector

Session 3 ICS Seminar 28

 GUIDELINES (Cont’d)

• Information and checking

flowlines should be used
within the responsibility
area.
• When notes are more
than one, they should be
numbered in sequence.
Session 3 ICS Seminar 29
 PHILIPPINE HOUSING CORPORATION
PROCUREMENT (Non-Stock)

DELIVERY, RECEIPT, INSPECTION AND ACCEPTANCE

Existing Procedural Flowchart
FC No. Proc-03

GENERAL SERVICES DEPARTMENT

PROPERTY DIVISION

SUPPLY OFFICER STOREKEEPER

Upon receipt of delivery

assigns
from file
6 number
from file
from supplier 1 5
(Note 2)
PO
S/M
8 SI/DR RR
SI/DR RRF
1-2 1-5
1-2 2
PO PO 1
1 signs &
affixes date signs &
(Note 1) affixes date
3 signs & Chief, Property Div
8 7
affixes date Approves RR

RI 4

1-3

RR RR
2-5 1
RI RI RI SI/DR
SI/DR 1-2
S/M
3 1 2 1-2 PO 1
PO 8 PO 1

Resident ICO, Pre Audit Div Temporary

Auditor Treasury Dept Storage

RR
LEGEND:
2-5 NOTES:
S/M - Supplies/Materials
SI/DR 1-2
SI/DR - Sales Invoice/Delivery Receipt 1. Representative of ICO and the Supply
PO 1 PO - Purchase Order Officer inspect the goods delivered and
RI - Request for Inspection each of them affixes his signature on the
OIC - Officer-in-Charge 'Inspected by' portion of stamped on the SI
(Note 3) RR - Receiving Report while a representative from the office of the
RRF - Receiving Report File Resident Auditor observes.
Procedural Flow
on DV Preparation 2. The assignment of RR number is based on
the last number issued on file.

3. The Supply Officer informs the

requisitioning department to prepare two
(2) copies of Requisition & Issue Slip (RIS)
for the issuance of the items requested.

08/08

Session 3 ICS Seminar 30

 GUIDELINES (Cont’d)
• When intersection of
flowlines cannot be
avoided, the latter flowline
should be slightly curved
to avoid confusion of flow
direction.

Session 3 ICS Seminar 31

 GUIDELINES (Cont’d)
• The legend and the notes column
should be placed at the right most
column or at the bottom of the
chart and should be on the same
page of the flowchart.

Session 3 ICS Seminar 32

 GUIDELINES (Cont’d)

• Flowchart sequence
number should be used
to show properly and
logically the sequence of
steps or activities.
-1- 2

Session 3 ICS Seminar 33

 GUIDELINES (Cont’d)

• If the document is
forwarded to a person,
indicate the purpose,
otherwise it is assumed to
be at his own disposal.

Session 3 ICS Seminar 34

 GUIDELINES (Cont’d)
• In preparing the flowchart,
subsequent procedures should
be anticipated so that
documents for the next
procedure can be properly
placed. (outputs becomes the
inputs)
• Consistency

Session 3 ICS Seminar 35

 Are you ready to draw a
flowchart?

Session 3 ICS Seminar 36

 End of Presentation

Session 3 ICS Seminar 37