Computerized Accounting System as an Aid to Efficient Management of an Organization

1.1 Introduction

Computerized Accounting information is a system that increases the control and enhances the cooperation in the companies. Accounting information aids in profit making, budgeting and cost control. In a company, it is the duty of the management accountant to see that his company keeps good records and prepare proper financial regulations. Management accountants also need to keep up with the latest development in the use of computers and in the computer system design. Accountants provide many special reports for management, decision making. This function requires the gathering of both historical and projected data. The financial accounting information system is one that is well designed to facilitate the smooth, efficient and uninterrupted flow of data from the point where a transaction occurs through the various stages of data processing to the final stage, thereby culminating in a report.

As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Limitation of the study and Definition of technical terms.

1.2 Background of Study

In ancient days, it was difficult to calculate, safeguard or keep records people were using toes and fingers in counting unite. As information technologies grow more progressive, the manual accounting systems have become gradually inadequate for decision needs. Consequently, public and private sector firms in both developing and developed economies view Computerized Accounting System as an Aid to Efficient Management of an Organization (CAIS) as a vehicle to ensure effective and efficient information flow in the recording, processing, and analysis of financial data. Effective and efficient information flow enhances managerial decision-making, thereby increasing the firm’s ability to achieve corporate and business strategy objectives. This in turn, may increase the prospects of the firm’s survival (Platt and Platt, 2012).

History of accounting started when people learnt how to record their activities. The early scribes made their marks on stone and wax tables, these way keeping records were invented to meet a need of gathering processing and preserving information. The earliest business records merely listed the belonging to some people later records began to show concern about profit and looses on venture income and expenditure were recorded.

Further advances in accounting were made by government and church officials it was until 1449 when Luca Pacioit, a Franciscan monk and an Italian mathematic presented to the world what is known as modern double entry, the published a book on mathematics called summa mathematics and on it he gave the first computer description a way of keeping good records.

Accounting is a language web to communication to financial system and other information to all interested parties of an organization. The importance of accounting information in expanding our economy cannot be over emphasized since organizations perform vital role in the development of the economy. And for them to effectively carry out these functions they employ system that quicken and promotes their services one of the systems is the introduction of computer in accounting operation as an aid to effective management of organization.

Computer can be define as an electronic device that is capable of accepting data as input process that data and produce information as output and store the information at the storage unit for uses when needed computer is fast accurate and more effective than human beings through it produce only what you feed it (i.e. garbage in garbage out) computer is a kind of mechanical device which on receipt of an input is capable of processing them according to a set of previously supplied instructions and making the output available when desired or needed.

Therefore computerization of accounting system in an establishment will ensure that all relevant information and explanations with respect to financial transactions are effectively processed and recorded. The decision to install this instruction in an organization must be weight with other cost, such as the initial capital outlay maintenance, staffing.

Before installation of computers, an organization system must carefully choose and know its operating system the operating system is the software that gives a life in animate to the hardware in many ways it is the operating system that gives a computer its distinct characteristics.

Today hundreds of organization have seen the need for computerized accounting system, any attempt to keep it away from organizations will course them and other financial institutions that engage in accounting n services a serious problem.

1.3 Statement of Problem

Investigation revealed that there has been the problem of accounting services been manually operated which result to loss of valuable time spent on any accounting transactions and because of poor management efficiency people are discouraged from using these services.

Poor accounting information jeopardizes administrative effectiveness, which makes managers of business organizations malnourished administratively in Nigeria. The consequence of this has been the current distressed syndrome that many organizations face. Many organizations need to learn to manage their intellectual assets (i.e. knowledge) in order to survive and compete in the knowledge society.

Furthermore, the introduction of computer services has created its own problems which rage from the type of installation, the employment of qualified personnel to operate them, the cost of installation and maintenance and cost of software packages.

1.4 Aim and Objectives of the Study

The aim of the study is to Design and Implement a Computerized Accounting System as an Aid to Efficient Management of an Organization. In achieving this aim, the following specific objectives were laid out as follows to develop an application software that will:

1. Identify the relevance of Computerized Accounting System as an Aid to Efficient Management of an Organization for business growth;
2. Identify the benefits of having an efficient Computerized Accounting System as an Aid to Efficient Management of an Organization;
3. Assess the various application of accounting information system by banks; and
4. Determine out the role of information technology in enhancing the efficiency of accounting information system.

1.5 Significance of Study

The significance of the study is that it will bring to light the importance of Computerized Accounting System as an Aid to Efficient Management of Organizations and the benefits associated with it. This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work. This study contributes to knowledge and could serve as a guide for other study.

1.6 Need for the Study

The need for this study is to determine:

1. If there is basis to sustain the alleged unemployment which will result as computer over take the operations which were previously handed manually.
2. To access the benefit enjoyed by customers of the organization through computerization.
3. To determine if there has been a significant improvement in the system of operation in out organization through the computerization process.

1.7 Scope of the Study

The study focuses on the Design and Implementation of a Computerized Accounting System. This study covers the relevance of proposed system as an Aid to Efficient Management of an Organization for business growth in organization.

1.8 Limitations of the Study

During the course of this study, many things militated against its completion, some of which are:

1. Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
2. Research material: availability of research material is a major setback to the scope of the study.
3. Frequent power failure: This made the researcher append more money on fuel to ensure sustainable power.
4. Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet).

1.9 Assumption of the Study

The computerized accounting system of an organization stem of the fact that records are used in preparing annual financial statement which are used by the management to know the end of each period.

It is therefore essential that computerized of accounting information in a trim helps to ascertain the reliability accountability efficiency and effectiveness of accounting information.

1.10 Definition of Terms

Accounting: The activity, practice, or profession of maintaining the business records of a person or organization and preparing forms and reports for tax or other financial purposes

Efficiency: The ability to do something well or achieve a desired result without wasted energy or effort.

Information: Definite knowledge acquired or supplied about something or somebody.

Organization: A group of people identified by a shared interest or purpose, e.g. a business.

Accounting Information: The collection, storage and processing of financial and accounting data that is used by decision makers.