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Accounting Technology Essay

4850 words - 20 pages

CHAPTER 4

RELATIONAL DATABASES

SUGGESTED ANSWERS TO DISCUSSION QUESTIONS

4.1 Contrast the logical and the physical view of data and discuss why separate views are necessary in database applications. Describe which perspective is most useful for each of the following employees: a programmer, a manager, and an internal auditor. How will understanding logical data structures assist you when designing and using database systems?</para></question><question id="ch04ques02" label="4.2">

Databases are possible because of their database management system (DBMS). As shown in Figure 4.2, the DBMS is a software ...view middle of the document...

Consequently, the query and sorting capabilities of spreadsheets are much more limited than what can be accomplished with a DBMS that has a good query language.

Accountants’ familiarity with spreadsheets might hinder their ability to design and use relational DBMS because many links in spreadsheets are preprogrammed and designed in, whereas a well-designed relational database is designed to facilitate ad-hoc queries.

Accountants’ familiarity with spreadsheets sometimes leads them to use a spreadsheet for a task that a database could handle much better. Over the years, the Journal of Accountancy has published a number of very good articles on how to use databases and when to use databases and when to use spreadsheets. These articles can be found on the Journal’s website: http://www.journalofaccountancy.com/



4.3 Some people believe database technology may eliminate the need for double-entry accounting. This creates three possibilities: (1) the double-entry model will be abandoned; (2) the double-entry model will not be used directly, but an external-level schema based on the double-entry model will be defined for accountants’ use; or (3) the double-entry model will be retained in database systems. Which alternative do you think is most likely to occur? Why?

There is no correct answer to this question because it is asking the student to express his opinion on what will happen in the future. Therefore, the quality of his answer depends on the justifications provided. Good answers should address the following:

* Database technology does permit abandonment of double entry, but there will likely be great resistance to such a radical change. Thus, students choosing this option need to present reasons why they think such a radical change would succeed.

* The use of a schema for accountants seems quite plausible. It does eliminate the redundancy of double entry from the database system, yet it still provides a framework familiar and useful to accountants and financial analysts.

* There is a good possibility that double entry will remain, even in databases, due to inertia. Indeed, many modern AIS, such as ERP systems, use databases but also retain the principles of double entry.

4.4 Relational DBMS query languages provide easy access to information about the organization’s activities. Does this mean that online, real-time processing should be used for all transactions? Does an organization need real-time financial reports? Why or why not?</para></question></general-problem></problemset>

On-line real-time processing is not necessary for every business transaction. For example, batch processing is adequate for payroll: there is little need for the data to be current except on payday. Real-time financial statements are...

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