Database design using the REA

How to design and document a relational database for an AIS.


Accountants may provide the greatest value to their organizations by taking responsibility for data modeling. Data modeling is the process of defining a database so that it faithfully represents all aspects of the organization, including its interactionswith the external environment. It occurs during both the system analysis & conceptual design stages. ER diagram and REA are the tools to perform data modeling. ER Diagram Showing the various entities and relationships. An entity is anything about which the organization wants to collect and store information.

Steps in database design:

- Planning
- Requirement analysis
- Design
- Coding
- Implementation
- Operation and maintenance

What is the role of accoutants in each steps of database design (see PowerPoint notes)

Data modeling

Data modeling is a 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 are:
------ Entity-relationship diagramming (E-R)
------ REA data model

Entity-relationship diagramming (E-R)

This is a graphical technique for portraying a database schema.
It shows the various entities being modeled and the important relationships among them.
The entity is anything about which the orgainzation wants to collect and store information.
In relational database, each table is representing an entity.

> Entities are depicted as rectangles (but this is only the common practice)

> Some people use diamonds to depict relationships.
> Some people do not use diamonds, just a line to depict relationships.

> Attributes associated with each entity are depicted as named ovals to each rectangle.
> Some people use separate table to represent attributes.

Resources, Events, Agents (REA)

REA is useful for deciding which entities need to be modeled.

REA data model classifies entities into three distinct categories:
- Resources: that the organization acquires and uses
- Events: in which the organization engages
- Agents: participating in these events

To combine E-R diagram and REA model is REA diagram

The REA data model prescribesa basic pattern for how three types of entities (REA) should relate each other. The three rules of REA model are:
- Rule 1: Each event is linked to at least one resources that it affects.
- Rule 2: Each event is linked to at least one other event.
- Rule 3: Each event is linked to at least two agents

Steps to developing an REA diagram:

Step one: Identify relevant events
Step two: Identify Resources and agents
Step three: Determine cardinalities of relationships