We’ve accumulated 15 years experience in the construction of BRMS based accounting systems. Over the past decade we have coordinated the architecture, design and implementation of six enterprise accounting systems based on business rules. We believe, from this experience, that Business Rule Management Systems (BRMS) are a very apt and empowering technology for this purpose. Furthermore that they are better than bespoke systems built on relational technology and off-the-shelf systems (like MicroGen). Despite recording our findings in our whitepaper and earlier blog articles, potential clients occasionally still ask: why BRMS? In this article we consider additional answers arising from questions posed to us by clients in the past year.

Clients sometimes ask… 

1. “Using a BRMS is overkill for accounting, surely a relational database with in mapping tables for generate postings is sufficient? After all, most accounting systems are just mappings of business events to postings.”

  • You can do this, it is technically feasible. But how will (technically non-savvy) business users use such a system? If you elect to have IT own and maintain the rules, you have lost a great opportunity for direct business stewardship of the accounting policies, which is turn means that your rules will be less agile (because all business rule changes will need to be mediated through IT) and more prone to error (because of the business/IT translation required). We have helped several clients for whom this loss of agility has become crippling.
  • If you require business users to steward the rules you will need to ‘wrap’ the database environment to support a user interface business users can work with. One that supports maintenance of rule integrity, version control, user friendly web interface, change audit, governance workflow, rule reporting and so on. One that prevents business users from common errors (e.g., accidental entering of mutually inconsistent rules) and that makes rule entry easier in the way that a database form is unlikely to. One that supports group collaboration. You will soon find the cost of this additional customisation mushrooms out of control and can easily exceed the cost of a vendor BRMS product. Then you will have to ask yourself: what business are you in? Finance or software development?
  • Relational databases are very powerful tools, but they do not provide the same degree of flexibility is defining declarative, business oriented rule formats and powerful conditions as a BRMS. The latter are designed to support business SMEs in managing their logic. Relational tables may be able to express simple, equality based, decision tables. But they cannot represent computational fact types, set membership, boolean operators and decision trees without obscuring the business intent with technical issues. Accounting policies need these features if they are to be expressed succinctly. Neither can database implementations support logic gap or overlap integrity checking without requiring considerable additional development. All of these features give a BRMS tremendous power that is pertinent to the evolution of an accounting ruleset.

2. “BRMS is about inference and accounting does not require inference, ergo accounting does not require a BRMS.”

  • Rule inference (and the use of algorithms like RETE to make inference computationally efficient) is a powerful technique in the armory of many BRMSs. It allows a declarative expression of business rules and simple representation of complex logic inter-dependencies that is well suited to some business domains. However, inference is only one aspect of the functionality of BRMS—it is not their defining characteristic. Many BRMS packages have no support for RETE and not every business problem, including accounting, requires it. Most accounting rules can be, and are, expressed in strict, mutually independent sequences with direct interactions between rule instances.
  • However BRMS do provide many other features which are directly relevant to accounting, for example: safe agility, speed to market, visibility, business control, organisation, business optimisation, behavioural traceability, goal traceability, support for governance, impact analysis, safety and control, audit, performance and testability. The benefits of these features are further explained here. The defining characteristic of BRMSs is collaborative management of business logic—exactly what is required for the effective management of an accounting policy by business SMEs.

3. “Inference aside, accounting rules are not very complex, why should we require a rules management system to support them?”

  • Accounting rules need to accommodate many product types which have very similar, but not identical accounting treatments. As a result, accounting rule sets very repetitive and many related treatments need to be repeated across products for consistency. Therefore it makes sense to denormalise your rules because by so doing you can reduce the size of your accounting schema by 5-8 times. This increases the number of rules slightly, but vastly decreases the size of each one.
  • It is difficult to denormalise rules in a relational database without loss of integrity between them. This is because rule integrity and relational integrity are very different concepts. BRMS have this capability as standard. However, without a BRMS this has to be added by the client (through potentially expensive bespoke development), or omitted entirely (introducing new modes of inconsistency within your rule set and increasing the cost of management).
  • In addition, rulesets managed with a BRMS are better able to express reusable accounting treatments and variants from this norm triggered by specific product types or regions. Features like rule inheritance, dynamic ruleflows and categories help to make rulesets, based on a BRMS, very product scaleable. This allows radically different products (e.g., fungible equities and non-fungible swaps), with careful design, to be handled by the same ruleset.


In short, just because you can cycle from Glasgow to Gibraltar to attend a business conference, that does not mean this is a very practical way to get there if you have aircraft or trains at your disposal and you are close to deadline. Similarly, you can support accounting rules without the aid of a BRMS and possibly save a few dollars, however when you look at the practicalities of enterprise accounting, a BRMS powered solution is easier, more robust, more scaleable and, we would contest, ultimately cheaper than a hand-crafted alternative.

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