Chapter 5

DATABASE MANAGEMENT
SYSTEMS
Synopsis
We will learn how data from business events are
recorded and process using differing Accounting
Information Systems design
Introduction
As an aspiring decision maker, you should know that
no matter what career you path take, data and database
will become an integral part of your day-to-day work. In
this chapter, we will learn about the benefits and costs
of alternative methods for collecting, storing, and using
business data
Two Approaches to Business Event
Processing
First, we know that as organizations engage in
business processes, such as purchasing inventory,
several business events such as preparing a
purchase order and receiving goods.
Second, as these business events occur, business
event data is captured to describe the Who, What,
Where, and When about the event.
The Applications Approach to Business
Event Processing
Record Layouts Under an Applications
Approach to Business Event Processing
Data Redundancy
Data Redundancy increase storage costs because
the system must store and maintain multiple
version of the same data in different files.

The data in firgure 5.2 have two purposes

(1) Mirror and Monitor the business operations
&(2) Provide the basis for Managerial decision
Databases and Business Events
The use of databases has improved the efficiency of
processing business events data by eliminating data
redundancies and improving data integrity
Database Management Systems
is a set of integrated programs designed to simplify
the task of creating, accessing, and managing data.

Integrate a collection of files that are independent

of application programs and are available to satisfy
a number of different processing needs.
Logical versus Physical Database Models
The concept underlying the data base approach to
business event processing is to decouple the data
from the system applications (that is to make the
data independent of the application or other users)

This decoupling is called Data Independence

In the language of DBMS, a schema is a complete
description of the configuration of record types,
data items, and the relationship among them.

Schema - defines the logical structure of the

database
- The organizational view of data

Subschema is a description of a portion of schema

Overcoming the limitations of the
Applications Approach
Eliminating the data redundancy
-With the database approach to business event processing,
an item of data is stored only once. Applications that
needed data can access the data from the central database.

Ease of Maintenance
-Because each data element is stored only once, additions,
deletions, or changes to the database are accomplished easily
 Reduced storage costs
-By eliminating redundant data, storage space is reduced, which results
in associated cost savings.

 Data Integrity
-This advantage, like several others, result from eliminating data
redundancy. With only one version of each data element stored in the
database, inconsistencies are no longer a threat.

 Data Independence
-The database approach allows multiple application program to use the
data concurrently. The data can be accessed in several ways (for
example, through applications processing, online query, and report
writing programs)
Privacy
-The security modules available in most DBMS
software include powerful features to protect the
database against unauthorized disclosure, alteration,
or destruction. Control over the data access can
typically be exercised down to the data element level.
Despite the many advantages of using a DBMS instead
of an application approach, some organizations do not
use a DBMS. A DBMS can be expensive to implement.
In general, a DBMS requires more power, and thus
more expensive, hardware.

Hiring people to maintain and operate the database can

be more expensive than hiring application
maintenance programmer.
Disadvantage of using DBMS
Although database sharing is advantage, it carries with
it a downside risk. If the DBMS fails all the
organization’s information processing halts.

Because all applications depend on the DBMS,

continuous data protection(CDP) and contingency
planning are more important than in the application
approach to data management.
When more than one user attempts to access data at
the same time, the database can face “Contention” or
“Concurrency” problems.

Territorial disputes can arise over who “owns” the data.

For instance, disputes can arise regarding who is
responsible for data maintenance
(additional/deletions/changes) to customer data.
Logical Database Models
Hierarchical Database Model

Records are organized in a pyramid structure. In a

hierarchical DBMS, records that are included in a
record one level above them are called child records
of that upper-level record. Parents record include the
lower-level child records.
Relational Database Model
The relational model was developed using a branch of
mathematics called set theory. In set theory, a two-
dimensional collection of information is called a
relation.
Two disadvantages of RDM
1. A relational DBMS requires much more computer
memory and processing time than the earlier
models.
2. The relational model, as originally conceived, allows
only text and numerical information to be stored in
the database.
Object-oriented Database Model
Both simple and complex objects can be stored.
In object-oriented database model, other types of data
can be stored. Object-oriented databases include
abstract data types that allow users to define
characteristic of the data to be stored when developing
an application.
An object can store attributes (similar to the attributes
stored in the table columns in a relational database),
and instructions for actions that can be performed on
the object or its attributes. These instructions are
called encapsulated methods.
Elements of Relational Databases
The elements that make up all DBMSs include
tables, a place to store data;
queries, tools that allow users and programmers to
access the data stored in various tables;
forms, onscreen presentations of data in tables and
collected by queries from one or more tables; and
reports, which provide printed lists and summaries of
data stored in tables or collected by queries from one
or more tables.
Classifying and Coding
Classifying – is the process of grouping or categorizing
data according to common attributes
Coding – creation of substitute values or codes. They
use a shorthand substitute for long labels.
Sequential Coding – also known as serial coding.
Assigns numbers to objects in chronological sequence.
Block Coding – group of numbers are dedicated to
particular characteristics of the objects being identified.
Significant Digit Coding – assigns meanings to
specific digits.
Hierarchical Coding – attach specific meaning to particular
character positions.
Mnemonic Coding – the word mnemonic comes from the
Greek mnemonikos, to remember, and means “assisting or
related to memory.”
Other coding schemes:
Self-checking digit code includes an extra digit that can be
used to check the accuracy of the code.
Functional Dependence and Primary Keys
An attribute (a column in a table) is functionally
dependent on a second attribute ( or a collection of other
attributes) if a value for the first attribute determines a
single value for the second attribute at any time. When the
functional dependence exists, the first attribute
determines the second attribute.
First Normal Form (1NF)
an unnormalized table contains repeating attributes (or
fields) within each row (or record). We call these repeated
attributes “repeating groups.” A table is in first normal
form (1nf) if it does not contain repeating groups.
Second Normal Form (2NF)
A table is in second normal form (2NF) if it is in first
normal form and has no partial dependencies; that is,
no non-key attribute is dependent on only a portion of
the primary key. An attribute is a non-key attribute if
it is not part of the primary key.
Third Normal Form (3NF)
A transitive dependency exists in a table when a
non-key attribute is functionally dependent on
another non-key attribute. A table is in Third Normal
Form (3NF) if it is in second normal form and has no
transitive dependencies.
Using Entity-Relationship Model
A Data Model depicts user requirements for data
stored in a database. The most popular data modeling
approach is entity-relationship modeling, in which
the designer identifies the important things (called
entities) about which information will be stored and
then identifies how the things are related to each other
(called relationships). Because this diagram includes
entities and relationships, it is called an entity-
relationship model.
E-R Diagram (also called an entity-relationship
diagram) reflects the system’s key entities and
relationships among those entities. The E-R Diagram
represents the data model.
Identify Entities
Any “thing” that is in important element in the business process
can be modeled as an entity
Accounting researchers have identified categories of entities that
commonly occur in systems that track accounting information.
These categories include resources, events, agents, and locations.
Resources – are assets (tangible or intangible) that the company
owns.
Events – are occurrences related to resources that are of interest to
the business.
Agents – are people or organizations that participate in events.
Locations – are places or physical locations at which events occur ,
resources are stored, or agents participate in events.
Identify the relationships that connect the
entities
Two events, such as SALES fill ORDERS
An agent and an event, such as ORDERS are received
from CUSTOMERS or SALES are made to
CUSTOMERS.
A resource and an event, such as ORDERS have line
items INVENTORY or INVENTORY line items SALE.
Characteristics of Relationships
The description of the relationship that appears in the
diamond, each relationship has a characteristic , called
cardinality that shows the degree to which each
entity participates in the relationships.
Maximum cardinality is a measure of the highest
level of participation that one entity can have in
another entity.
Characteristics of Relationships
The description of the relationship that appears in the
diamond, each relationship has a characteristic , called
cardinality that shows the degree to which each
entity participates in the relationships.
Maximum cardinality is a measure of the highest
level of participation that one entity can have in
another entity.
Using DBMS and Intelligent Systems to AID
Decision Makers
 Decision Support Systems (DDS) – Are information systems that assist managers with
unstructured decisions by retrieving and analyzing data for purposes of identifying and
generating useful information.
 Executive Information System (EIS) – this systems, which can be considered a subset
of DDS, combine information from the organization and the environment organize and
analyze the information, and present the information to the manager in a form that
assists in decision making.
 Group Support System (GSS) – are computer-based systems that support collaborative
intellectual work such as idea generation, elaboration, analysis, synthesis, information
sharing, and decision making. Groupware, the software identified with GSS, focuses on
such functions as e-mail, group scheduling, and document sharing.
 Expert Systems – Many decision-making situations can benefit from an even higher
level of support than that provided by the DDS, EIS, or GSS. Neutral networks (NN) are
computer hardware and software systems that mimic the human brain’s ability to
recognize patterns or predict outcomes using less-than-complete information.
 Intelligent Agents - is a software program that may be integrated into DDS or other
software tool (such as word processing, spreadsheet, or database packages).
Knowledge Management
Knowledge Management is the process of capturing,
storing, retrieving, and distributing the knowledge of
the individuals in an organization for use by others in
the organization to improve the quality and efficiency
of decision making across the firm. Effective
knowledge management means that an organization
must be able to connect the knowledge of one
individual with the other individuals in the firm that
need the same knowledge.
Storing Knowledge in Data Warehouses
Data warehousing – is the use of information systems
facilities to focus on the collection, organization,
integration, and long-term storage of entity-wide data.
Data Mining – is used to better understand an
organization’s business processes, trends within these
processes, and potential opportunities to improve the
effectiveness and efficiency of the organization.

Data warehousing and Data mining are dependent on the

massive data integration and data independence made
possible through database technology.