Grand Canyon Retail Stores Flowcharting

The owners of the company that operated a retail store outside Grand Canyon National Park and two retail stores within the park wanted to retire. They contracted with Delaware North Companies (DNC) to buy them out.

Two weeks before the closing date, the owners agreed to allow me to visit their offices inside the park for the purpose of meeting with the accounting staff and documenting the accounting systems.

The Controller had recently left the Company and DNC was promoting someone from the Corporate offices to relocate to the Grand Canyon and assume the role of Controller. My job was to flowchart the accounting systems, identify the internal control points (most important controls), and report on internal control weaknesses with recommendations to strengthen those weaknesses.

I met with the General Manager who gave me an overview of how the accounting system worked. Then, I met with each of the accounting people who explained to me how his/her area of expertise functioned. As they were talking, I was furiously scribbling notes on a note pad.

Having gone through the systems, I sat down with my computer, opened the flowcharting software, and started clicking on various symbols to represent the Revenue Cycle. As I dragged the symbols to the proper position on the page, I typed phrases into the symbol that described the function a specific person performed. I connected the symbols with lines and finished the page with a connector symbol that would refer the process to the next page where the description of the process continued.

When I finished flowcharting the Revenue Cycle, I reviewed it with the personnel whom I had described in the Flow Chart. I asked whether the process I had described was correct or if modifications were needed. Usually, one or two changes needed to be made. Changes are easy with software because with a few clicks you can delete a symbol and replace it with a different one and type a new description.

Once satisfied that the process described was correct, I identified the control points, those controls that if failed, serious repercussions could occur, i.e. employee theft, significant undetected errors, etc. Once the control points were identified, I reviewed the controls to ensure they were adequate to detect theft or significant undetected errors. Those I deemed to be inadequate I listed in my report to management with recommendations that would strengthen them.

I continued this process for the inventory cycle and the payroll cycle. Among the three cycles, I covered all aspects of running a Retail operation. When finished, I had the revenue generation and accounting systems documented. The new Controller could read my flowcharts and get a pretty good understanding of how the accounting and operating systems functioned.

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