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In: Accounting

Describe the difficulties a company would face if they were to replace their current system in...

Describe the difficulties a company would face if they were to replace their current system in lieu of the REA accounting information system.

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Expert Solution

The Resources, events, agents (REA) accounting model was first conceptualized in a paper for the 1982. It is a framework for building accounting systems in a shared data environment, both between enterprises and within enterprises. The core feature of REA model was an object pattern inclusive of two mirror- image constellations that displays semantically the input and output components of a business process.

The REA accounting model has to battle many difficulties and challenges. The learning curves for instruction in REA are very steep, and usually seems to take more than a year and multiple passes through the AIS course before the normal accounting faculty member feels becomes efficient enough with the use of material in a proper integrated fashion. Moreover, the company would have to begin from scratch when switching to a REA accounting information system. Furthermore these are not designed to make correlations among events just what account it is that will be debited and credited, thus are not designed to do basic functions. It is not simple to convert such programs.

The REA effect on accounting practice has been less pronounced, partially due to the impediments of technology to REA implementations are just now starting to be removed. Little progress is being made with prototype directed implementations in actual practice, and also with empirical investigations research insights are being uncovered that posit evolutionary movement in the marketplace of enterprise software toward full conceptualization of REA.

ekkarill92 answered 1 year ago
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