Represent the give event and receive event of an economic exchangeĮxternal Agent Participates Out Flow Give Economic Resource A Event Internal Agent Duality Internal Agent Inflow Receive Economic Resource B Event External Agent REA Model showing Duality of a Give and Receive Exchange Participates Give Activity Receive Activity Participates Participates Figure 10-2ĮR Diagrams (ERD’s) versus REA Diagrams (READ’s).Another key feature of the REA model is economic duality.Participates External Economic Agent Stock Flow Economic EconomicEvent Resource Internal Economic Duality Participates Agent Basic REA Model Figure 10-1 Can be inside or outside the organization.Have discretionary power to use or dispose of resources.Agents can be individuals or departments.Support – control, planning, and other management activities but do not directly affect resources.Economic – increases or decreases resources.a source of detailed data in the REA approach to databases.Events are phenomena that effect changes in resources.artifacts that can be generated from other primary data.Does not include some traditional accounting assets:.objects that are scarce and under the control of the organization.objects of economic exchanges able to generate revenue.Resources – the ‘assets’ of the company.REA models consists of three entity types and the associations linking them.supports accounting and non-accounting analysis.collects detailed financial and non-financial data.formalized data modeling and design of IS.REA is an approach to database design meant to overcome problems with traditional approaches:.restricted user-view leads to poor decision-making.When data-modeling and IS design is too oriented toward the user’s views, problems arise:.Traditional Approaches:User-View Orientation Be able to create an entity-wide REA diagram by applying the view integration steps to a business case. Be able to create an REA diagram by applying the view modeling steps to a business case.

Understand the structure of an REA diagram. Understand the key differences between traditional entity relationship modeling and REA modeling. Objectives for Chapter 10 Recognize the economic foundations of the resources, events, and agents (REA) model. Chapter 10The REA Approach to Business Process Modeling

Business process modelling ppt