Accounting Information Systems 7th Edition by Cynthia Heagy,Constance Lehmann

Exercise 15

Morgan Electrical Supplies distributes electrical components to the construction industry. Morgan began as a local supplier 15 years ago and has grown rapidly to become a major competitor in the north central United States. As the business grew and the variety of components to be stocked expanded, Morgan implemented a computerized inventory system. Other applications, such as accounts receivable, accounts payable, payroll, and sales analysis were gradually computerized as each function expanded. The inventor)' system, due to its operational importance, has been upgraded to a real-time posting system while all the other applications use batch posting. Over the years, Morgan has developed or acquired more than 100 application programs and maintains 150 files.
Morgan faces stiff competition from local suppliers throughout its marketing area. At a management meeting, the sales manager complained about the difficulty in obtaining immediate, current information to respond to customer inquiries. Other managers stated that they also had difficulty obtaining timely data from the system. As a result, die controller engaged a consulting firm to explore the situation. The consultant recommended installing an accounting system that uses a database, and Morgan proceeded on this course, employing Jack Gibbons as the database administrator.
At a recent management meeting, Gibbons presented an overview of the new accounting system using Exhibit 12.4. Gibbons explained that the database approach assumes an organizational. Data-oriented viewpoint, as it recognizes that a centralized database represents a vital resource. Instead of being assigned to applications, data are more appropriately used and managed for the entire organization. The operating system physically moves data to and from disk storage. The database management system software has a data definition language with which the data structures and characteristics can be specified. As a result, the roles of die application programs and query software, and the tasks of the application programmers and users are simplified. Under the database approach, the data are available to all users subject to security restrictions.
Required:
a. If you were Gibbons and making the presentation to management, how would you describe the basic difference between the old accounting system that used conventional files and the new one that uses a database?
b. If you were Gibbons and making the presentation to management, how would you describe at least three advantages and three disadvantages of the new accounting system that uses a database?
c. Describe the duties and responsibilities of Jack Gibbons, the database administrator.
[CMA adapted]