There are four basic elements of data flow diagrams which are important as they are used to represent processes, data stores, external entities, and data flows. First, the DFD symbols are used to represent processes, which receive input data and produce output with different content or forms. These are essential in financial reporting and accounting as they can be used for the collection of input data as well as saving of such data in the database. These could be daily or monthly sales data. The symbol used identifies the functions that it performs. For instance, an accountant may represent a process of data collection, using a rounded rectangle. The symbols may also be used to represent data flow, which is the path followed for data collected to move from one part of the information system to another. This could be crucial in accounting recording since it may be used using specific information like the customer information, data order information. It is notated using a straight line.
The straight line may be an incoming or outgoing one to represent input and output data, respectively. Datastore or repository is also a commonly used data flow diagram that may represent a situation, especially when the system is required to retain the collected data for further processing or future references. Data like those of the inventory, accounts receivables, or daily payments may be written into the data store depicted by an outgoing arrow. Finally, the external entity includes the stakeholders whose information is essential in the financial reporting process. These are the representation of how the information system interacts with the external stakeholders, for instance, customer submitting an order or a vendor issuing an invoice. The four DFD symbols can be used by an accountant to make the chats on the processes to flow and thus are easily used for decision making.
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