An accounting systems teacher An IT practitioner and standards wonk An accounting scholar ??
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Transcript of An accounting systems teacher An IT practitioner and standards wonk An accounting scholar ??
"Ontologically-Driven Standards Development for Business Process Systems“Bill McCarthy, Michigan State University
• An accounting systems teacher
• An IT practitioner and standards wonk
• An accounting scholar ??
• An enterprise ontologist and computer scientist??
• An accounting practitioner ??
1
Warning Label
– The version of accounting you are about to hear is not the “received view”
– The REA (resource-event-agent) accounting model is based on modeling of the economic primitives of a business process (exchange or conversion)
– The ALOE (assets = liabilities + owners equity) accounting model is based on accounting reporting structures (double entry)
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The REA ontology – Theory & Standards Use• ontology = categories of interest in a domain and the
relationships among them• REA is a business enterprise (economic & accounting)
ontology with:– Exchanges (in green)– Policies (in yellow)– Plans (in purple)
• REA is both a positive (descriptive) and normative (prescriptive) accounting theory
• For interoperability, REA is used:– in ISO Open-edi (ISO 15944-4) – UN/CEFACT – as specialization module for the UMM
• For enterprise system, see Workday model• Standards use follows academic work of Geerts and
McCarthy• Interoperability use needs to move up the Obrst scale,
but frame-based semantics enable collaboration state machine
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M2 Level -- Elementary REA model
Economic Event
Economic Agent
stockflow
duality
Economic Resource
participation
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Cookie-Monster (the customer) and Elmo (the entrepreneur) meet in the (real or virtual) marketplace, thus setting the
stage for an Economic Exchange
5
Cookie-Monster (the customer) and Elmo (the entrepreneur) engage in a
SHIPMENT (transfer of Cookie Inventory)
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Initiating
Terminating
Economic Resource
provide
receive
stock-flow
Economic Event
Economic Agent
Economic Agent
Economic Agent
Economic Agent
Economic Resource
duality
Economic Event
stock-flowprovide
receive
M1 Level -- Elementary REA model for exchange process 7
Cookie-Monster (the customer) and Elmo (the entrepreneur) engage in
a PAYMENT (transfer of Cash)
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Initiating
Terminating
Economic Resource
provide
receive
stock-flow
Economic Event
Economic Agent
Economic Agent
Economic Agent
Economic Agent
Economic Resource
duality
Economic Event
stock-flowprovide
receive
M1 Level -- Elementary REA model for exchange process 9
Product#
Description
Price
QOH
P-1 Chocolate Chip
1.05 200
P-2 Chocolate .95 205
P-3 Peanut Butter
1.00 97
P-4 Pecan 1.10 257
Invoice#
Payment Timestam
p
Amount Applied
I-1 2JUL0830 14.75
I-2 3JUL0800 2.00
I-2 5JUL0800 18.00
I-3 8JUL1145 9.90
I-4 8JUL1145 9.20
C-999E-12363JUL9.90I-3
C-999E-12375JUL9.20I-4
C-888E-12352JUL20.00I-2
C-987E-12341JUL14.75I-1
Customer #
Entrepreneur
#
Date
Dollar Amoun
t
Invoice#
Product# Invoice# Quantity
P-2 I-1 5
P-3 I-1 10
P-3 I-2 20
P-4 I-3 9
P-1 I-4 4
P-3 I-4 5
COOKIES
SHIPMENT
COOKIES-stockflow-SHIPMENT
SHIPMENT-duality-PAYMENT
Story of why this invoice amount to $14.75 ??
M0 Level – (partial) REA model for exchange process 10
• Who ? taxonomy• What ? taxonomy• When ?
The REA Model (ISO Open-edi accounting & economic ontology) is a pattern for a business process
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Subtypes (possible) for ECONOMIC RESOURCE
Economic Resource
compositionEconomic Resource
Typetypifystructure
Services Rights Goods
Intellectual Product
(IPR)
Real Estate
Regulatory Service
Transport-ation
Services
Materials Human Services
Funds Right of Way
Warranty Insurance
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Subtypes of Economic Agent for an Exchange
Economic Agent
Mediator Guarantor NotaryEscrow
Third PartyRegulatorPartner
SellerBuyer
Economic Agent Type
typify
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• Who ?• What ?• When ?
• Over what time period ?– Past and near present
– Policy future
– Scheduled future
The REA Model (ISO Open-edi accounting & economic ontology) is a pattern for a business process
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What actually occurred
What could be or should be
Rtype Etype Atype
Resource Event Agent
Color-coded time expansion 15
R
Operational Level– What Actually Happens; What is --
Policy Level-- What Should, Could or Must be --
Integration
E A
T G
ENTERPRISE SYSTEMSINPUT OUTPUT
Observation
Planning &Control
Inference, Validation,
Discrepancy Analysis
Policy-Level Specifications in REA Enterprise Systems
ExtendedEnterprise Model
Facts
Knowledge-Intensive Descriptions,
Validation Rules, and Target Descriptions
(Standards & Budgets)
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type images for business process components
• Typification is a conceptual abstraction of a business process component (REA) that indicates its ideal or grouped properties
• the Archetypal Essence of a business object
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Economic Resource
EconomicEvent
Economic Agent
stock-flow participation
Economic Resource
Type
Economic Event Type
Economic Agent Typepolicy
typify typify typify
policy
M2 Level -- REA model of Exchanges & Policies 18
meronymic
0..*1..1
PK
receive
duality
provide
0..*
stockflow
{incomplete, disjoint}
«EventType»ExpeditionType
- expeditionTypeName PK- expedExpectedTimeLength- standardUndiscountedSlotFee- expeditionTypeCapacity
«EconomicResource» SupplyItem
- supplyItemTypeNumber PK- supplyItemPrice- supplyItemQOH-
«EconomicResourceType»
SupplyItemCategory- supplyItemCategoryName PK- monthlySaleAmountOfSIC
«EconomicAgentType»
EmployeeType- employeeType PK
- startingWageForEmpType- countOfEmployeesForType
«EconomicEvent»
Expedition- expeditionNumber PK- slotsFilledForScheduleExped- actualDuration- scheduledExpeditionDate
«EconomicEvent» ExpeditionTicket
- ticketNumber PK- discountedSlotCharge- total$AmountOfSupplyItems- countOfSlotsOnThisTicket
«EconomicResourceType»
AircraftType
- aircraftTypeName PK- aircraftSeatingCapacity- aircraftFuelCapacity
«EconomicResource» Aircraft
- aircraftEngineNumber PK- dateAircraftManufactured- aircraftName CK-
«EconomicAgent» Employee
- employeeNumber PK- employeeName
«EconomicAgent» ExpeditionWork
er- employeeNumber PK
«EconomicAgent»
Guide- employeeNumber PK- dateQualifiedAsAGuide
«EconomicAgent» BookingAgent
- employeeNumber PK- bookingAgentCommRate
«EconomicAgent»
Pilot- employeeNumber PK- dateOfInitialPilotLicense
«EconomicAgentGroup»
People
- peopleName PK- approximatePopulation
«EconomicAgent»
Client- clientNumber PK- clientName
«EconomicEvent» Payment
- remittanceAdvceNum PK- $AmountOfRemitAdvice- clientCheckNumber
«BusinessLocation»
Location- locationName PK- locationMapCoords CK
distance
- distanceBetween policy-sequence
- sequenceOfLocationOnTour
policy- qualifies
- hoursFlown
stockFlow
- quantityOfItemOnThisTicket
policy-count
- countOfEmployeeType
«EconomicResource» Cash
- cashAccountNumber PK- cashAccountBalancereceive
provide
participatestockflow
participate
participate
policy
policy
typify
typify
typify
0..*
0..*
0..*
site
0..*
0..*
0..*
0..*
0..*0..*
0..*
0..*
0..*
1..1
0..*
0..*0..*
0..*
0..*
0..*
0..*
0..*
0..*
0..*
0..*
0..*
1..*
1..*
1..*
0..*
0..*
0..*
0..*
0..*
1..1
1..1
0..1
1..1
1..1
1..1
1..1
0..10..*
0..*
lead
groupgroup
0..* 0..*
0..1 0..1
0..*
typify
0..1
start finish
M1 Level – Typed REA model for NAAE revenue process 19
What actually occurred
What could be or should be
Rtype Etype Atype
Resource Event Agent
Color-coded time expansion
What is planned or scheduled
Commit Event
Rtype
Etype
Atype
20
commitment reciprocal
fulfills
commitment
fulfills
economic event
duality economic event
M2 Level -- REA model of Scheduled Exchanges 21
Commitment
specifies
Resource Type
specifies Event Type
specifies
Agent Type
Abstract Specification of Commitments22
Economic Event
Economic Resource
Economic Agent
stockflow provide
receive
Economic Commitment
reciprocal
fulfills
duality
Resource Type
typifiesspecifies
Event Type
Agent Typespecifies
specifies
typifies
typifies
participate
policy
policy
policy
1. Green – “What has occurred” – REA, duality, stockflow {consume, produce}, participation {provide, receive}
2. Yellow – What could be or should be – TYPES, typify, policy
3. Purple – What is planned or scheduled – COMMITMENTS, specify, fulfill, reciprocal, triggers
M2 Level – Extended REA model (simple & symmetric) 23
- manufacturingRunNumber PK- actualTotalT&MCost- toDateRunLaborCost- toDateRunMaterialCost- actualQuantityProduced
«EconomicEvent»Manufacturing Run
-operationTypeName PK
-standardSequence
«EventType»Operation Type
-employeeTypeName PK-startingWage
«AgentType»Employee Type
- scheduledOperationNumber PK
- scheduledSequence
«EconomicCommitment»Scheduled Manufacturing Operation
quantityOfRawMaterialPerUnit
policyBM
-scheduledMinutes
specify1
-minutesparticipate
-minutesUsed
used
-laborMinutesPerUnit
policyOL
-standardUnitCost-qOH
«EconomicResourceType»Raw Material Type
-rawMaterialCatalogNumber PK
-minutesNeededPerUnit
policyTM
-dateAcquired
«EconomicResource»Raw Material
-rawMaterialTagNumber PK
-quantityOwned
«EconomicResourceType»Tool-Machine Type
-toolMachineTypeDescription PK
-standardUnitCost
-qOH
«EconomicResourceType»Medical Equipment Type
-medicalEquipmentCatalogNumber PK
-standardGramWeight
-dateAcquired
«EconomicResource»Tool-Machine
-toolMachineNumber PK
-totalMinUsedSinceAcquis
-scheduledMinutes
specify
-scheduledQuantity
specify
- productionOrderNumber PK -budgetedTotalLaborCost-budgetedTotalMaterialCost
- projectedQuantityProduced
«EconomicCommitment»Scheduled Manufacturing Run
- budgetedTotalTool&MachineCost
-quantityUsed
used
-minutesparticipate
-minutesparticipate
- initiationTimestamp PK
- actualDuration
«EconomicEvent»Manufacturing Operation
- actualSequence
duality
participate
specify
produce
participate
typify
policyBM
fulfill
1..1
1..*
-medicalEquipTagNumber PK-actualGramWeight
«EconomicResource»Medical Equipment
-employeeNumber PK-employeeName
«EconomicAgent»Employee
-wage-dateHired
-employeeNumber PK
«EconomicAgent»Machinist
-employeeNumber PK
«EconomicAgent»Assembler
-employeeNumber PK
«EconomicAgent»Electrician
-employeeNumber PK
«EconomicAgent»Scheduler
-employeeNumber PK
«EconomicAgent»Supervisor
reciprocal
fulfill
typify
typify
typify
consume
participate
specifyspecify
1..1
1..1
1..1
1..1
1..1
0..*
0..*
0..*0..*
0..*
0..*
0..*
0..*
0..* 0..*
0..*
0..1
0..1
0..1
0..1
0..10..1
1..*
1..*
1..*1..*
1..*
1..*
1..*
{complete, disjoint}
0..*
0..*
0..*
0..*
0..*
0..*
0..*
1..1
1..1
1..1
1..1
1..*
1..*
1..*
0..*
0..*
0..*
0..*
0..*1..1
1..1
0..*
1..*
1..*
typify
1..1
0..*
M1 Level – Scheduled REA model
for MME manufacturing process
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Bilateral Transaction
governed
Economic Event
Economic Resource Person
resource-flowfrom
to
Economic Contract
Economic Commitment
reciprocal
fulfillment
economic bundle
duality
Economic Resource
Type
typification
economic specification
Economic Event Type
Economic Role
Partner Third Party
Mediated Transaction
Business Transaction
participates
Economic Agreement
Regulator
typification
typification
economic specification
economic
specification
participates
participates
25Extended REA model for ISO 15944-4
• Who ?• What ?• When ? • Over what time period?• Why? (duality + sf = value chain)
The REA Model (ISO Open-edi accounting & economic ontology) is a pattern for a business process
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A business process takes one or more kinds of input and creates an output that is of greater value to the
customer .
Conversion Process
labor
cookie ingredient
s
Acquisition Process
cash
cookies Revenue Process
cash
A value chain is a purposeful network of conversions and exchanges aimed at assembling the individual components of a final product (i.e., its portfolio of attributes) of value to
the customer
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• Who ?• What ?• When ? • Over what time period?
The REA Model (ISO Open-edi accounting & economic ontology) is a pattern for a business process
• How? (through a series of small events that move business processes through to completion)
• Why? (duality + sf = value chain)
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A business process takes one or more kinds of input and creates an output that is of greater value to the
customer .
Conversion Process
labor
cookie ingredient
s
Acquisition Process
cash
cookies Revenue Process
cash
A value chain is a purposeful network of conversions and exchanges aimed at assembling the individual components of a final product (i.e., its portfolio of attributes) of value to
the customer
• publish catalog
• make sales contact
• negotiate customer order
• ship goods (ee)
• send invoice
• accept payment (ee)
Workflow is a series of business events that progress a business
process through its phases, leading to eventual completion (ordering is determined by state machine
mechanics). 29
• Planning: In the Planning Phase, both the buyer and seller are engaged in activities to decide what action to take for acquiring or selling a good, service, and/or right.
• Identification: The Identification Phase pertains to all those actions or events whereby data is interchanged among potential buyers and sellers in order to establish a one-to-one linkage.
• Negotiation: The Negotiation Phase pertains to all those actions and events involving the exchange of information following the Identification Phase where a potential buyer and seller have (1) identified the nature of good(s) and/or service(s) to be provided; and, (2) identified each other at a level of certainty. The process of negotiation is directed at achieving an explicit, mutually understood, and agreed upon goal of a business collaboration and associated terms and conditions. This may include such things as the detailed specification of the good, service, and/or right, quantity, pricing, after sales servicing, delivery requirements, financing, use of agents and/or third parties, etc.
• Actualization: The Actualization Phase pertains to all activities or events necessary for the execution of the results of the negotiation for an actual business transaction. Normally the seller produces or assembles the goods, starts providing the services, prepares and completes the delivery of good, service, and/or right, etc., to the buyer as agreed according to the terms and conditions agreed upon at the termination of the Negotiation Phase. Likewise, the buyer begins the transfer of acceptable equivalent value, usually in money, to the seller providing the good, service, and/or right.
• Post-Actualization: The Post-Actualization Phase includes all of the activities or events and associated exchanges of information that occur between the buyer and the seller after the agreed upon good, service, and/or right is deemed to have been delivered. These can be activities pertaining to warranty coverage, service after sales, post-sales financing such as monthly payments or other financial arrangements, consumer complaint handling and redress or some general post-actualization relationships between buyer and seller.
SOURCE: ISO FDIS 15944-1 – Operational Aspects of Open-edi for implementation ISO Open-edi Phases of a Business Process 30
Negotiation
Identification
Planning
Post-Actualization
Actualization
Extended Business Process Model (ISO 15944-1
Accounting Model
Whole Business
Process Model
31
BT Phase Example Business Event
Planning Seller publishes Catalog
Buyer sends CatalogRequest to Seller
Seller sends Catalog to Prospective Buyer
Identification Buyer sends AvailabilityandPriceRequest to Seller
Seller returns AvailabilityandPriceResult to Buyer
Negotiation Buyer sends Offer to Seller
Seller sends CounterOffer to Buyer
Buyer accepts details of CounterOffer on Shipment and proposes PaymentSchedule
Seller accepts PaymentSchedule, completing Contract specification (alternatively, another CounterOffer would loop or a NonAcceptance would suspend or abandon the Business Transaction)
Actualization Seller sends an AdvanceShippingNotice when goods are prepared for shipping
Buyer sends ReceivingReport to Seller when inspected goods are accepted
Seller sends an Invoice to Buyer after parts are shipped
Buyer sends RemittanceAdvice to Seller with information about payment of the Invoice
Post-Actualization
Buyer sends WarrantyInvocation to Seller
An Example Business Process with Business Events Grouped in ISO 15944-1 Phases
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Economic Event
Economic Resource
Economic Agent
stock-flow inside
outside
Economic Agreement
Economic Commitment
Economic Claim
materializes
settles
fulfills
establish
duality
Economic Resource
Type
typifyspecifies
Economic Event Type
Economic Agent Type
specifies
specifies
typify
typify
reciprocal
Business Processgoverns
Business Event
Business Process Phases
workflowValue Chain
networked
aggregate
33
UMM – the Meta Facts (Huemer & Liegl)
• Graphical process modeling technique for inter-organizational (B2B) business processes
• Concentrates on business semantics – is implementation neutral
• Provides a procedure similar to a software development process
• from requirements elicitation to process design
• UMM is defined as a UML profile on top of UML 2.1.1
34
UMM Package Structure (Huemer & Liegl)
Foundation
BusinessRequirementsView
BusinessDomainView
CollaborationRealizationView
BusinessPartnerView
BusinessEntityView
BusinessChoreographyView
BusinessTransactionView
BusinessCollaborationView
BusinessInformationView
35
UMM Business Entity View –
Business Process Activity Model
(Huemer & Liegl)
36
:Importer:Exporter :ImportAuthority:ExportAuthority
«SharedBusinessEntityState»:WasteTransport
[announced]
«SharedBusinessEntityState»:WasteTransport
[arrived]
«BusinessProcessActivity»Pre-inform on waste transport
«BusinessProcessActivity»Pre-inform on waste transport
«BusinessProcessActivity»Inform on waste receipt
«BusinessProcessActivity»Inform on waste receipt
«SharedBusinessEntityState»:WasteTransport
[accepted]
«SharedBusinessEntityState»:WasteTransport
[rejected]
«BusinessProcessActivity»Inform on waste transport
acceptance
«BusinessProcessActivity»Inform on waste transport
acceptance
«BusinessProcessActivity»Inform on waste transport
rejection
«BusinessProcessActivity»Inform on waste transport
rejection
«bEState»accepted
«bEState»announced
«bEState»arrived
«bEState»rejected
Final
36
EconomicResourceType
Candidate<<BusinessEvent>>
publishCatalogPlanned
<<BusinessEvent>>
sendAvail&PriceRequest
Proposed <<BusinessEvent>>
sendOffer
Identified
<<BusinessEvent>>
returnAvailabilityAndPriceResult
<<BusinessEvent>>
acceptOffer
Specified <<BusinessEvent>>
sendReceivingReport
Actualized
State Machine Diagram for Economic Resource Type37
BUYER SELLER
<Business Event>
publishCatalog
<SharedBusinessEntityState>
:PlanningPhase
[InService]
<Business Event>
sendCatalog
<SharedBusinessEntityState>
:EconomicResourceType
[Candidate]
<SharedBusinessEntityState>
:PlanningPhase
[WaitingStart]
<Business Event>
generateResourceNeeds
<Business Event>
sendCatalogRequest
<SharedBusinessEntityState>
:EconomicAgent
[Candidate]
<Business Event>
receiveCatalog
<SharedBusinessEntityState>
:PlanningPhase
[Complete]
38
BusinessProcess
BusinessProcess
BusinessProcess
Enterprise #1
BusinessProcess
BusinessProcess
BusinessProcess
Enterprise #3
Enterprise #2
BusinessProcess
BusinessProcess
BusinessProcess
Collaboration Perspective: Trading Partner vs. Independent
Independent view of Inter-enterprise events
Trading Partner view of Inter-enterprise events (upstream vendors and downstream customers)
Dotted arrows represent flow of goods, services, and cash between different companies; solid arrows represent flows within companies
Japan expert contribution to 15944-4, 22 Oct 2001, Victoria BC , 39
Where is REA headed ??
One must still have chaos in oneself to be able to give birth to a dancing star.
Friedrich Nietzsche
The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the
world to himself. Therefore, all progress depends on the unreasonable man.
George Bernard Shaw
40
REA can be used to model and design the accounting components of software systems. It has also been used to model external business processes or business collaborations for ebXML and TMWG of UN/CEFACT. It has also been used to model inter-firm phenomena such as supply chains and to analyze the efficacy of a variety of enterprise software systems. Moreover, this documentation can be expressed at multiple levels of granularity, ranging from high level value chains and supply chains all the way down to the level of workflow tasks. The original model covered both inter- and intra-enterprise transactions, but its use can be specialized for either case.
Can it be used to solve a variety of different sorts of problems or as a starting point to construct multiple sorts of applications?
The original paper was published in the top accounting journal in the world (The Accounting Review) in 1982. No substantive criticisms of its features have been published in the intervening 20 years.
Is it stable?
The REA primitives may be used to model any of the economic dealings of an enterprise. The actual chain of entrepreneurial logic might itself be hard to explicate in a minority of cases (why for instance do firms support public charities or why is training important for employees ?), but once those links are made at some level of granularity, REA primitives are able to document them.
Is the language used expressive enough for people to say what they want to say?
The three leading textbooks on accounting systems analysis and design all use REA extensively to define system primitives and to explain modeling of accounting phenomena.
Do people use it as a reference of precisely defined terms?
The original paper and all extensions since have been published in high quality refereed journals (The Accounting Review, IEEE Intelligent Systems, etc.) where its components are open to constant review and criticism. In 1996, the original paper was given the first Seminal Contribution to the Accounting Information Systems Literature Award by the American Accounting Association. The work was most recently awarded the 2003 Innovations in Accounting Education Award by the AAA.
Does it express the consensus knowledge of a community of people?
REA ExplanationFunctional Criteria
SOURCE: Gomez-Perez & ISO 15944-4 41
Positioning and Formalizing the REA Enterprise Ontology-- Frederik Gailly, Wim Laurier, and Geert
Poels 42
weak semanticsweak semantics
strong semanticsstrong semantics
Is Disjoint Subclass of with transitivity property
Modal Logic
Logical Theory
Thesaurus Has Narrower Meaning Than
TaxonomyIs Sub-Classification of
Conceptual Model Is Subclass of
DB Schemas, XML Schema
UML
First Order Logic
RelationalModel, XML
ER
Extended ER
Description LogicDAML+OIL, OWL
RDF/SXTM
Ontology Spectrum: One View (Leo Obrst)
Syntactic Interoperability
Structural Interoperability
Semantic Interoperability
43
• At this stage we can conclude that the REA ontology can be considered as a semantically rich business domain ontology that needs to be further formalized to make more of the inherent semantics explicit.
• The bulk of REA design science research to date (see e.g. David et al. (2002)), with some exceptions mentioned in the paper, was aimed at improving REA’s content and theoretical background, but has to a considerable extent ignored representational, formalization and operationalization issues. Although we don’t question nor criticize the relevance and significance of this work, we believe that equal attention should be paid to ontology engineering aspects that aim at improving the explicitness, preciseness, completeness and formality of REA’s specification
Positioning and Formalizing the REA Enterprise Ontology-- Frederik Gailly, Wim Laurier, and Geert
Poels
Where is REA headed ??
44
Where is REA headed ??• Basic ontology theory to be revised and submitted to
accounting literature• Standards projects:
– ISO – done for now– UN/CEFACT – a lot of work needed
• Formalization initiative – Some being completed by others– Move to common logic
• Workflow component must be formalized• Accounting issues on back burner:
– Claims, adjustments, macro-level aggregation and duality, materialization and use of services, internal control specification, other accounting definition issues
• Others ??
45
“REA-Scruffie” “REA-Neat”The world consists of: 1. Classes or objects that are
• particulars--universals;
• occurrents--continuants;
• concrete--abstract;
2. associations between these entities/objects that are of the form• <particular , universal> e.g. is-instance-of, classification
• <particular , particular> e.g. is-part-of (also u-u), aggregation
• <universal , universal> e.g. isa (is-subtype-of), generalization
3. declarations, procedures, and constraints
Need progress towards formal logic that enhances frame semantics with completeness, decidability, etc.
46
The Financial Interoperability Summit – May 12-13 2008
• Sponsored by the National Science Foundation (Frank Olken)• Looked at formal issues associated with accounting and financial
interoperability at both the reporting level and the transaction level• Three main exemplars:
– XBRL-FR and XBRL-GL– REA – SDMX
• “REA needs to move up the semantic expressiveness scale & integrate with XBRL”
• Wiki (Thanks to Brand Niemann):– http://nsfaccountingontology.wik.is/Workshop– See especially group research issues and individual positions– Summary paper coming by Debreceny and McCarthy
• The big issue: Tradeoffs between semantic expressiveness, time to implement, and benefits (next slide)– “The enemy of the good is the perfect” ??
47
A
Time Horizon
Ont
olog
ical
Exp
ress
ivity
Low
Hig
h
Yr 0 Yr 10
B
C
1. First Dimension – Ontological Expressivity (following Leo Obrst): -Low ontological expressivity (syntactic interoperability) with term-based thesauri and taxonomies; - Medium ontological expressivity (structural interoperability) with semantic conceptual models
(such as E-R models and UML class diagrams); and - High ontological expressivity (semantic interoperability) with description logic based
theories.2. Second Dimension – Time Horizon for Implementation : The implementation horizon for adoption of higher expressivity
and more useful interoperability standards can range over multiple years. For the purposes of the workshop, we are limiting ourselves to an immediate – long-range spectrum of one to ten years (readily conceding that these are only present estimates).
3. Third Dimension – Benefits Accruing to Implementation : Implementation of ontological solutions to business problems occurs because of a suite of perceived benefits to be gained. These benefits can be estimated in a range from low to medium to high, and they may flow from some combination of improved interoperability with other standards and systems, lower transaction costs, and improved functionality for consumers of information. (SIZE of CIRCLE)
Benefits measured by size of
circle
Different implementation scenarios for financial interoperability standards
48
SMAPPIE says “Any questions??”
49