1. Implementing an REA Model in a Relational Database
Chapter 18
Implementing an REA Model in a Relational Database
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2. Learning Objectives
Integrate separate REA diagrams for individual business cycles into a single, comprehensive organization-wide REA diagram.
Build a set of tables to implement an REA model of an AIS in a relational database.
Explain how to write queries to retrieve information from an AIS relational database built according to the REA data model.
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3. REA Diagram—Revenue Cycle
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4. REA Diagram—Expenditure Cycle
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5. REA Diagram—Payroll Cycle
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6. REA Redundancies
Separate REA for an organization will have redundant entities
Resource
Each resource entity must be connected to:
The resource entity is linked to event entities in one business cycle and to event entities in the other cycle
One event that increases the resource and,
One event that decreases the resource
No effect on cardinality
Events
Alters the minimum cardinalities associated with the other events that are related to the merged event
May be linked to either an event that is part of one business cycle or to an event that is part of another cycle but cannot be linked to both events
The minimum cardinality associated with the other events must be 0 in the integrated REA diagram
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7. Integrated REA Diagram
Expenditure Cycle
Revenue Cycle
Payroll Cycle
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8. Cardinality Effect of Merging Resources
Cardinalities between resource and entities remain the same.
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9. Cardinality Effect of Merging Events
The cardinality between Disburse Cash and Supplier and Employee (as payee) is now 0 to 1, that is, a disbursement can be made to the supplier or the employee but not both!
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10. Rules for Creating Integrated REA Diagram
Every event must be linked to at least one resource.
Every event must be linked to two agents who participate in that event.
Every event that involves the disposition of a resource must be linked to an event that involves the acquisition of a resource.
Every resource must be linked to at least one event that increments that resource and to at least one event that decrements that resource.
If event A can be linked to more than one other event, but cannot be linked simultaneously to all of those other events, then the REA diagram should show that event A is linked to a minimum of 0 of each of those other events.
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11. Using REA Diagram to Create Relational Database
Advantage:
Ensures the elimination of anomalies:
Update
Insert
Delete
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12. REA to Database Steps
Create a table for each distinct entity in the diagram and for each many-to-many relationship.
Assign attributes to appropriate tables.
Identify primary keys:
Attributes that uniquely identifies each record.
For M:N relationships the primary key consists of two attributes that represent the primary keys of each entity linked in that relationship.
Identify remaining attributes for table.
Use foreign keys to implement one-to-one and one-to-many relationships.
An attribute of one entity that is itself the primary key of another entity.
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13. Retrieving Information from REA Database
Journals
Information contained in event tables
Ledgers
Information contained in resource tables
Financial statements
Information contained in resources and
Information on imbalances
Accounts receivable
Sales transactions for which customer payments have not yet been received
Accounts payable
Purchases from suppliers that have not yet been paid for
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