Recording / Financing Fixed Asset Acquisition Human Resources Purchasing Revenue Traditional files approach: separate systems Expenditure Cycles Reporting.
Published byModified over 4 years ago
Presentation on theme: "Recording / Financing Fixed Asset Acquisition Human Resources Purchasing Revenue Traditional files approach: separate systems Expenditure Cycles Reporting."— Presentation transcript:
Recording / Financing Fixed Asset Acquisition Human Resources Purchasing Revenue Traditional files approach: separate systems Expenditure Cycles Reporting & G/L Production
Problems with multiple systems Coordination difficult because of lack of shared information Sales inventory production,… Scheduling budgeting operations,… Multiple versions of the “truth” What is sales—per accounting, marketing, production?? Same information stored in multiple master files: Redundancy higher costs, inefficient, inconsistency
Databases o Developed to address problems associated with multiple master file systems o Treats data as an organizational resource to be used and managed by the entire organization, not just one department. o Most new AISs implement a relational database approach. o Virtually all mainframe computer sites use database technology
Database Benefits Data integration Data sharing Reporting flexibility Minimal data redundancy and inconsistencies Data independence Cross-functional analysis
Classifying Accounting Systems – types (small to big) Single Entry Money, Quicken Bookkeeping Systems (organized around A=L + OE) Peachtree, DacEasy, Quickbooks Multidimensional Accounting GEAC’s SmartEnterprise, Solomon’s Solomon IV Modular Integration JBA Software’s System 21, Lawson’s Insight II Enterprise Suite Single Source ERP SAP’s R/3, Oracle Financials, JD Edwards’ One World, PeopleSoft, Baan’s BaanERP
Enterprise Resource Planning (ERP) system Means of collecting, processing and storing data about a business’ processes Provide information reports designed for managers and external parties Uses a centralized database to share information across business cycles Provides for efficient and effective coordination of activities
ERPs SAP, Oracle/PeopleSoft/JD Edwards, Lawson –Be sure to read ABCs of ERPs
Enterprise Resource Planning (ERP): An Integrated Solution Customer Order Processing Inventory Management Manufacturing Procurement Receiving Shipping Financial System Human Resources Equip. Ware- house Data about ALL of the various business processes
How do ERP’s provide integration? Common Database Sales HR A/R Materials Management Production A/P Cash Mgt Quality Control
Reporting out of the ERP Standard—export to *Excel* perhaps convert to ASCII for SEC convert to HTML for web convert to pdf for distribution ….. XBRL convert to ASCII for SEC make available to SEC, web, pdf…
Foundational units of Database Systems Relational databases Normalization Data modeling Query languages
Relational Database Definitions Primary key=attribute or combination of attributes that uniquely indentifies a specific row in a table (i.e. customer number, inventory item number, vendor number, GL account number, etc.) Foreign key=attribute in one table that is a primary key in another table. Used to link tables together. Vendor number is primary key in Vendor table, foreign key (link) in purchase table. In purchase table, the primary key is the Purchase Order #.
Relational database rules The following four constraints produce a well-structured (normalized) database in which data are consistent and redundancy is minimized and controlled: Every table must have a unique primary key—cannot be null (blank) Foreign keys must be null or have a value corresponding to the value of a primary key in another table Each attribute must describe a characteristic of the object identified by the primary key—all attributes must relate to the primary key Each column in a row must be single-valued—no repeated attributes In a normalized database: No calculated fields All related tables must be connected with foreign keys
Relational Data Bases Consider the transaction captured by this source document:
Relational Data Bases EVENTAGENTRESOURCE InventoryCustomerSale What entities are involved?
Relational Data Bases EVENTAGENTRESOURCE InventoryCustomerSale What tables are needed?
Relational Data Bases Is all information accounted for?
Relational Data Bases What database rule(s) are violated?
Relational Data Bases We correct these problems by adding another table to create a “normalized” data base Data duplication is minimized Note the “concatenated” primary key in the Sales-Inventory table
Relational Data Bases We have created an efficient relational database that uses foreign keys to link the tables:
Normalization rules Remove all fields with multiple values—the multiple-valued objects should be their own table Remove all fields that do not depend upon the entire primary key—the fields belong to one of the connected tables Remove all fields whose values can be unambiguously predicted by looking at the values of a non-primary key field—the fields should be in their own table Example of Data bucket—start with data attributes and sort into normalized tables
Data modeling Definition: Process of defining a database so that it faithfully represents all aspects of the organization, including its interaction with the external environment. Identify objects of interest Identify relationships Identify attributes of the objects Example of Semantic modeling—start with understanding of business and how processes work to begin model INSTEAD of starting with a mess of data and applying “normalization rules” to develop a set of tables a data model such as REA lets us BEGIN with business knowledge to create a set of normalized tables
Query Languages Allows database users to retrieve, sort, and presents subsets of the database information Usually consists of a easy to use set of commands to enable users to retrieve their own information without programmer assistance Microsoft Access has a query language. Turn to book example starting on page 119.