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Karnataka Class 12 Commerce Accountancy Models of Database Management System

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Karnataka Class 12 Commerce Accountancy Models of Database Management System : The process of computerised accounting involves identifying, storing and retrieving the data content of an accounting transaction. This requires a mechanism to store such data content of vouchers in a manner that allows its easy and convenient retrieval as and when required. This is achieved by designing suitable database for accounting. Such a database consists of inter-related data tables that are structured in a manner that ensures data consistency and integrity.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Designing Database for Accounting

Both computerised and computer-based AIS require a definite data structure for storing the accounting data. As already mentioned, the databases are used for storing accounting data. The process of designing database (for accounting) begins with a reality (or accounting reality) that is expressed using elements of a conceptual data model. 

Reality : It refers to some aspect of real world situation, for which database is to be designed. In the context of accounting, it is accounting reality that is to be expressed with complete description.
ER Design : This is a formal blue print, with a pictorial presentation, in which Entity Relationship (ER) Model concepts are used to represent description of reality.

Relational Data Model : It is representational data model through which ER design is transformed into inter-related data tables along with the restriction in the form of rules that are specified to ensure the consistency and integrity of stored data.

Normalisation : This is process of refining a database design (that consists of inter-related data tables) through which the possibility of duplicate or redundant data items is reduced or eliminated.
Refinement : This is the outcome of the process of normalisation as mentioned above. The final database design is arrived at after the process of normalisation is completed.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Database Technology
It refers to a set of techniques that are used to design a database. These techniques use certain concepts, which are crucial to the creation of structure and development of the design. These concepts are: Reality, data, database, information, DBMS and database system. A brief description of these concepts is given below:
(a) Reality : It implies some aspect of the real world. It consists of an organisation, its different components and the environment in which the organisation exists and operates. Any organisation includes people, facilities and other resources that are organised to achieve certain goals. Each organisation operates within an environment. While operating, the organisation interacts, influences and gets influenced by the environment.
This continuous interaction results in real world transactions. These transactions are analysed with a view to identify the components called data items. A data item is the smallest named unit of data in an information system.
In a transaction, the names of accounts (or their accounting codes), date of transaction, amount, etc. is all data items.
(b) Data : Data are known facts that can be recorded and which have implicit meaning. Data represent facts concerning people, places, objects, entities, events or even concepts. Data can be quantitative and qualitative or they can be financial and non-financial in character. 
(c) Database : The data, after being collected, has to be stored so that different people can use them. This requires the creation of a database. A database is a shared collection of interrelated data tables, files or structures, which are designed to meet the varied informational needs of an organisation. It has two important properties (or characteristics): one it is integrated and second it is shared. Integrated property implies that distinct data tables have been logically organised. The purpose is to reduce or eliminate redundancy (or duplicity) and also to facilitate better data access. The shared property means that all those who are authorised to use data/information have access to relevant data. Thus, a database is a collection of related data that represents some aspect of the
real world (called mini-world or Reality). Accordingly, accounting database is a collection of related accounting data to represent some aspect of an accounting information system. Database is designed, built and populated (or loaded) with data for a specific purpose.
(d) Information : refers to data that have been processed and organised in a form, which is suitable for decision-making. The raw data when processed in accordance with decision usefulness of a decision-maker becomes information. In other words, information is a data that have been processed and refined and then presented in a format that is convenient for decision- making or other organisational activities.
However, information may be viewed as data at one level. But when it is processed keeping in view the requirements of decision situation, it becomes information at another level. For example, accounting data at transaction level is processed to produce balances of each account. The balances are summarised to prepare the trial balance. The amounts given in trial balance constitute data to produce profit and loss account and balance sheet.
(e) Database management System (DBMS) is a collection of programs that enables users to create and maintain a database. Formally, it may be defined as a general-purpose software system that facilitates the processes of defining, constructing and manipulating (or processing) databases for various applications. General-purpose software is defined as a set of programs, which
are designed and developed for a community of users and not for any particular application with respect to a particular user.
DBMS software is used to implement the data model by creating several tables, setting their interrelationships and imposing constraints as may be set out in database design. After, the design is implemented, it must also allow for retrieval of data and information. This is achieved by querying the database, for which purpose, SQL statements are put to use. These retrieval requests result in emergence of new virtual tables that may be formed out of one or more of existing tables.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

A clear understanding of these SQL statements is a first step towards the theoretical foundations for computerised reporting. This is because a report is an organised set of information, which is extracted on the basis of these retrieval requests. For a practical understanding of these operations, consider the following Models, herein referred to as Model-I and Model-II. Each of these models, which consist of a set of relations (or tables) and the integrity constraints, constitutes the database design for accounting.
(1) Database Concepts
Reality : It consists of different components of an organisation such as people, facilities and other resources.
Data : It represent data concerning people, places, objects entities, events, etc. and non-financial 14 nature.
Database : It was a shared collection of inter-related data tables, tiles or structures which are designed to most varied information needs of all organisation.
International : Processed data organisation in a form that is suitable for decision-making.
DBMS : A collection of programmes that enable users to create and maintain a database.
(2) Database System Concepts and Architecture
Data model : Collection of concepts used to describe the structure of a database.
Database Schemes : The description of a database is called its scheme.
Data Base State and Instances : Data in a database at a particular movement is called database state.
(3) Entity Relationship (ER) Model

An important concept of data model mostly used in data base oriented application. The major elements of ER model are entities, Attributes, identities and relationship that are used to express reality for which a data base is to be designed.

(4) Relation Data Model (RDM)
It represent the database at collection of tables comprising different volumes. It consists of rows and columns. The table name and column name are used to help in interpreting the meaning of volumes of each row. Each row of table is called a data record.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Entity Relationship (ER) Model
It is a popular conceptual data model, which is mostly used in database-oriented applications. The major elements of ER Model are entities, attributes, identifiers and relationships that are used to express a reality for which a database is to be designed. The model best depicted with the help of ER symbols, the list and description of which is shown in figure 14.5. While preparing an ER Diagram, the following symbols are used to represent different types of entities, attributes, identifiers and relationships :
The elements of ER model that are meant to describe and display the reality are discussed in the context of an accounting reality given below :
Symbols
Entity Type as Rectangular Box
Weak entity Type as double lined Rectangular Box
Relationship Type as diamond shaped Box
Identifying relationship Type as double lined diamond shaped Box
Attribute names enclosed in ovals and attached to their entity type by straight lines
Key attribute names enclosed in ovals and attached to their entity type by straight lines.
Multi-valued attributes by double ovals.
Derived attributes by dashed line Ovals
Total participation of E2 in RCardinality Ratio 1 : N for E1 : E2 in R
 Accounting Reality
Describing the System of Accounting
Using a hypothetical example of accounting system of an organisation, following statements of reality becomes the starting point of discussion in describing the ER Model concepts. Example Reality :
• Accounting Transactions of an organisation are documented using a voucher.
• Each vouchers is assigned a serial number, which begins with “01” indicating first vouchers of the accounting period. There is only one simple transaction voucher used for documenting the transactions 
• Each voucher documents date of transaction, account name along with its account code for debit as well as credit entry.
• Each voucher indicates the amount and narration with respect to accounting transaction.
• Support documents such as bills, receipts, contracts, etc. also may be attached to an accounting voucher.
• Each Voucher is prepared by a particular Employee and authorised by another employee.
• There is an exhaustive list of Accounts with respect to which the transactions are documented. Each Account carries a unique numeric code with its width equal to six digits.
• Each Account is classified as belonging to one of the Accounts Types: Expenditure, Income, Assets and Liabilities.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

Relational Data Model
The relational data model represents the database as collection of relations, which resembles a table of values (or data table). Each row of the table, therefore, represents a collection of related data values and hence typically corresponds to real world entity or relationship. The table name and column names are used to help in interpreting the meaning of values in each row. Each row of a table is called a data record. All values in a column, which belong to a particular domain, are of same data type.
Formally, a row is called a tuple, a column header is called an attribute and the table as such is called a relation. The data type describing the types of values (such as text value, numeric values, date values, currency value, etc.) that can appear in each column is called a domain. A domain is a set of indivisible values. Associated with every domain is a data type such as Number, Text, Currency, Date/Time, etc. Each domain must also be named so as to help in interpreting its values. Besides this, a domain must be given a format and any additional information to enable correct interpretation of values. For example, a numeric domain such as distance should have units of measurement: Miles or Kilometers
(a) Relations : A relation schema is made up of a relation name and a list of its attributes. Each attribute is the name of role played by some domain in the relation schema. A relation is given an identity by its name and description by its schema. The degree of a relation is indicated by the number of attributes it contains.
(b) Values in Tuples : Each value in a tuple is an indivisible value to imply that it is not divisible into components within the framework of the basic relational model. This implies that composite and multi-valued attributes are not allowed. Composite attributes are represented by their simple components. The multi-valued attributes are represented by separate relations. A special value called Null is used to represent unknown or not applicable values of attributes in a tuple. It is also possible to devise different types of code values for different types of null value situation.

Karnataka Class 12 Commerce Accountancy Models of Database Management System

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Karnataka Class 12 Commerce Accountancy Models of Database Management System

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Karnataka Class 12 Commerce Accountancy Models of Database Management System Books to downloadDownload Link
  • Class 12 Accountancy Text book
  • Need for Maintaining of Accounts books by Non Profit Organisation
 

  • Accounting book 1
 

  • Accounting book 2
  • Accounting book 3

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