Accounting Information Systems: Pressure Hydraulics

Pressure Hydraulics is a locally owned business that currently has three service centres; Newcastle, Toronto and Maitland. Each service centre provides maintenance and specialised servicing ofhydraulic systems as used in cars, trucks and earth moving equipment. The Maitland service centre
also provides a specialty service to the mining industry where two purpose built trucks go onsite toservice a range of mining equipment.
The business has become quite profitable in the past years and its owner, Allan Taylor, has devisedplans to expand by opening service centres at Coffs Harbour and Gosford. Allan has future plans forother service centres along the east coast of NSW. He also feels that the time is right to look at how IT can support the existing business and enable his future business plans.
Currently, Allan spends a portion of each day at each service centre to monitor its operations. This isleaving little time to continue developing his business and he realises he will not be able to spend thesame sort of time in the Coffs Harbour and Gosford service centres.
Existing System
Each service centre operates as an independent business, with eight technicians in the workshop (oneof whom is a workshop foreman) and one office assistant. The office assistant takes phone calls frompeople requesting quotes for work or to have work done. For requests on quotes, the office assistantlooks up a hard copy of a price book (known as The Price Book) and gives a verbal quote. Allan isunhappy with the time being taken to update the Price Book as the office assistant is often too busy toupdate the prices from the supplier invoices. Sometimes, this time delay results in either lost sales ifthe price has gone down or lost income if the price has gone up.If a customer phones to make a booking for work to be done, the office staff assistant writes down thedetails in a journal (Works Book). Any variations to the Works Book by a customer requesting tochange a date/time results in crossed out entries. There have been times when this has been the causeof misinterpretation as to when a job is booked in. Other problems with the system include occasionaloverbooking or slack periods for the workshop staff.
When a customer arrives at a service centre for work to be done, the office staff member writes out aJob Card with the customer details along with the price from The Price Book for the job. There issometimes a discrepancy between what the Price Book shows and what the customer says they werequoted for that particular work. When completed, the Job Card is passed to the workshop foremanwho assigns the job to a technician. When the job is completed, the technician initials the Job Cardand gives it back to the workshop foreman, who returns it to the office. The office assistant writes outan invoice and collects payment from the customer; cash, EFTPOS and credit card are acceptable
forms of payment. Once per week, the office assistant uses the Job Cards to prepare an order for stockreplacement.Allan has developed a business relationship with several transport companies where two technicianswill go to the transport companies’ central site and service the hydraulics on a truck. As the partsrequired to perform the service can be varied, a special van equipped with basic workshop equipment
and a full range of component parts is used. The time taken for these jobs can be varied andunpredictable. Upon returning from such a job, the technicians will alert the workshop foreman thatthe job has been completed. The office assistant is then informed and an invoice written out andmailed to the transport company. Carbon copies are used to track such invoices. The Maitland servicecentre provides a service to the mining industry and there have been a few repeated issues with theincorrect component parts being taken onsite for servicing the machinery. Such mistakes not onlycosts a loss in terms of travel time back to the service centre to collect the correct part, but the miningcompanies have very tight maintenance schedules. Machinery has to be available and delays are nottolerated.
Each fortnight, Allan contacts the workshop foremen and checks the hours worked by staff at theservice centre. He then prepares the payroll and writes cheques for each employee.Each day, the office assistant banks the day’s takings and gives the bank receipt to Allan when he
makes his daily call. Usually this will be the following day from the bank deposit. Allan then does a
reconciliation of money banked with the previous day’s takings.Apart from the issues identified above, Allan wants to achieve the following:
– Ensuring repeat business from mining companies.- Improve control over stock ordering. A new system is required to manage this aspect of the
business. The ability to order stock for the three businesses instead of individual orderingwould ensure economies not being realised at the moment.
– Ability to quickly determine if a required component part is in stock.

– Ability to generate an invoice off data held within the system.
– Improved payroll process to reduce the need to contact staff for details. Allan would prefer asystem that recorded the working hours daily and also supported staff being paid directlythrough his bank system.
– Tracking customers for repeat business. Allan wants a system that will track customers andcontact them at specified times with special offers.

– Price Book issues. A system to have timely production of price variations to arrive at allservice centres on the same day.
– Technology to support these changes.
After an initial investigation, Allan has asked your group to develop a feasibility report on providing a
suitable solution for the accounting and payroll problems. At a minimum level, your feasibility report
should contain the following generic sections:

Task:
You are required to submit a feasibility report.
At a minimum level, your feasibility report should contain the following generic sections:
 Executive Summary
 Description of the problem
 Solution objectives
 Constraints
 Development plans
 Potential solutions
 Recommendations

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