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CHAPTER 15 DATABASE DESIGN USING THE REA DATA MODEL INTRODUCTION Questions to be addressed in this chapter include: What steps are followed to design and implement a database system? How is the REA data model used to design an AIS database? How is an entity-relationship (E-R) diagram of an AIS database drawn? How are E-R diagrams read, and what do they reveal about the business activities and policies of the organization being modeled? Steps in database design include the following: Planning —determining need and feasibility. Requirements analysis —identifying specific user needs; defining scope; making preliminary hardware and software decisions. Design —developing schemas. Coding —translating internal-level schema into database structures. Implementation —transferring data from old to new system; testing; training employees. Operation and maintenance —using and monitoring. Eventually, changes in business strategy and practices or new IT developments lead to the need for a new system and the process starts over. Accountants can and should participate in all stages of the database design process. But they provide the greatest value by taking responsibility for data modeling —the process of defining a database to faithfully represent all aspects of the organization, including interactions with the external environment. Two important tools to facilitate data modeling include: Entity-relationship diagramming REA data model ENTITY RELATIONSHIP DIAGRAMS An entity-relationship (E-R) diagram is a graphical technique for portraying a database schema. It shows the various entities being modeled and the important relationships among them. An entity is anything about which the organization wants to collect and store information. In a relational database, separate tables would be created to store information about each distinct entity. In an object-oriented database, separate classes would be created for each distinct entity. In an E-R diagram, entities are depicted as rectangles. But there are no industry standards for other aspects of these diagrams. In this book, lines are drawn to represent relationships between entities, and the attributes of each entity are listed in a separate table. In addition to their use in designing databases, E-R diagrams can be used to document and understand existing databases or re-engineer business processes. In this chapter, we’ll use E-R diagrams for designing new databases and understanding existing ones. THE REA DATA MODEL Chapter 15: Database Design 1
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The REA data model was developed specifically for use in designing accounting information systems. It focuses on business semantics underlying an organization’s value chain activities. It provides guidance for identifying the entities to be included in a database and structuring the relationships among the entities.
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This note was uploaded on 01/22/2011 for the course COB acct taught by Professor Smith during the Fall '09 term at California Coast University.

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