Expert opinion [accounting

Abstract

The infrastructure of a corporate enterprise information system is concerned with acquiring, transferring, converting, and selling economic resources such as cash, inventory, and supplies. Accounting systems with individual computerized modules, such as: payroll, accounts payable and receivable, job costing, order entry, and general ledgers, have traditionally tracked such data, and accounting system designers usually have had a preemptive call on the basic schemes used to type economic data. This is because of a need to meet either statutory reporting requirements for governmental agencies, or private reporting requirements for creditors and shareholders. If accountants use these preemptive privileges to force traditional account coding onto the organization database as its fundamental classification architecture (that is, to require early bookkeeper filtering of transaction data), then many dysfunctional effects arise. Our remedy for these deficiencies is to apply the REA (economic resources, events, and agents) conceptual model when analyzing, designing, implementing, and operating an enterprise information system. REA specifically incorporates the semantics of economic objects into a firm's information architecture. Such embedding facilitates an information system's initial design, as well as couples its production use with knowledge based decision support systems.