Mentally-challended (a.k.a. retarded) kids use this word as an insult. Also used by mom's when they are tired. Possibly an abriviated version of "Dip-Shit"
I didn't even have to take a test to receive that toilet paper diploma.
I don't know why Mike hangs that toilet paper diploma in his office. It's not recognized by anyone outside this office, and by almost noone inside this office.