COMPUTER AN IMPORTANT SYSTEM IN THE PROCESSING OF ACCOUNTING INFORMATION

1.0 Introduction

1.1 Background of Study

The basis for financial planning and analysis is the financial information financial information is needed to predict, compare and evaluate the firms earnings ability it is also required to aid in economic decision making investment & financial decision making. The financial information of an enterprise is contained in the financial statement or accounting report.

Accounting is the guide post for management every enterprise should know the activities carried on by it and the financial implication of its operations. The financial score of an enterprise is kept by the accounting system accounting information unit in business context is a unit in an organization that processes transaction to provide score keeping. It points out the problem faced or likely to be faced by the enterprise. It also brings to the notice of the firm the opportunities that are likely to arise. It indicates possible action, when needed. Accounting is the process of identifying, measuring and communicating economic information to permit judgment and decision by users of the information.

Accounting information could be classified under two heading or three headings. Under two headings. It is classified as.

Financial accounting which provides information about profit and loss and financial position of the organization at a given period and management accounting which provides management information needed for planning and control in an organization. Under three heading. It is classified as:

i. Routine — Internal report:

That is day to day reports to management for planning and control of the organization function for instance performance report financial reports and accounts.

ii. Non-routine report:

This aids management for examples budget forecast, estimates and projections and articulation of computer organizational goals. No lay down format

iii. External report:

this is for external interest groups like government and creditors. in the present country, the accounting information system has improved tremendously owing to advancement in technology. The development of computer has been acclaimed as the most important technological development of the twentieth century Davis (1981-88) defined computer as a machine that is capable of manipulating or processing data under its own control without the need for being. “I computer has an electronic device that has the ability to accept data, internally score and automatically execute a program of instruction performed mathematical logical and report the result”.

Computer is the latest craze in Nigeria today and it will continue to be relevant as the country develops. It has gained acceptance in all sectors of the economy.

The computer system as an important in the processing of accounting information cannot be over emphasized . The complicated nature of decision which must be taken in business organizations and government institution most especially in the area of financial and accounting operation often makes the use of computers mandatory if efficiency and effectiveness is to be maintained. As pointed out by Chukwu D.C.

The intelligent use of computer by the industrialized nations are led to efficient and effective private and public sectors which produce high quality goods at low cost and are seller able to whether the violent storm of keen foreign competition.

Developing economics like Nigeria enjoy low cost goods and services provided by develop economics and at the same time tries to protect their local industries from stiff foreign competition goods and services provided by these developing communities are inferior and dearer compared to that of developed countries.

Speed and accuracy of services are the watch word in most computerized industries mainly in fully industrialized. This makes it possible for them to realized their ultimate objectives (i.e. wealth maximization)

Through the use of computers economic pictures of the organization could be enhanced by cost displacement. Operational and revenue improved by the introduction of computers in all sectors of the economy. The tread towards representing information in manual dates to Hollezith (1890). In recent time there has been a move towards doing away with manual record keeping and transmitting the information electronically leading to what is called “ Paperless optice” However, it normally turns out that what goes automated is not the function as it has been performed to do what would normally be uneconomical and in some cases impracticable.

Instead one looks for a character of function, typically consisting of transition of current work of a number of people which can be redesigned so that he computer can do something equivalent although usually not identical. Once such a duster of work has been identified and the computer application designed one must also redesign the jobs of the people with whom the computer application will have to face.

The work of some workers will be substantially affected by the introduction of computers it does not mean, for instance that an accountant cases to be an accounted rather, the computer greatly aids his diverse operation as an accountant.

In fact, computer is gradually taking over all sphere of human endeavors especially the processing of accounting and cam perform any function provided information fed into it is accurate, complete and factual.

1.2 Statement of the Problem

In our world today computers are used in large and small business education, science and engineering, health care, sports, in the home entertainment and leisure, artificial intelligence expert system, government and military. Due to the vest use of computer in almost every sector of the economy, the need for controllers or information generated by the computer becomes unavoidable.

One can rightly say that quick customer services and fast accounting operation is far from being actualized in some of our organizations. Quick services and fast operations means move work being done in shorter time. A firm with these qualities will have unrivaled customers attraction.

Musa (1985) noted that information processing probably the most significant industry in the world economy today and in the foreseeable future. It has expanded and continues to expand at a rapid rate. This expansion is in part related to the increase in cost effectiveness of computer hardware. Cost effectiveness has increase by a factor far bout 1000 every decade. As long as this rate charge continues, the rangers of tasks that can be handled most economically by computing is likely to grow rapidly. Since software is the major part of most computer systems, the field of software engineering can expect similar rapid growth.

At this junction we look at what is actually the relevant of computer in the processing of accounting information.

According to Mcral C.N. The computer can be used in a wide variety of ways and often it is only the potential user who can appreciate and suggest the uses. It is impossible that the user will exploit the potentials of the computer of he depends ion experts.

The computer soon absorbs most of the calculation and data processing within an organization. These have traditionally been the accountants responsibility and it is likely that certain aspect such as accuracy and control will remain his responsibility.

It is known that overtime duties are common in accounting system as the working hours do not seem to be sufficient to finish a given days job. This of course means extra costs on the firm for overtime allowances and utility bills.

Some areas of accounting are hardly delved into by accountants because of high demands in time and human brain. Untold time and money is spend in rectification of mistakes made by workers in the course of manual processing of accounting information in particular and to business organization in general.

The researcher would also like to know how a business can apply computer, as well as planning for a computerized accounting system to finally to find out why some organization prefer using manual to using computer in business.

1.3 Research Hypothesis / Question

Research Hypothesis

To come out with a reliable result the following hypothesis will be formulated and tested statistically.

Hypothesis One

• H0: Computerization of accounting information system does not hinder the effectiveness of the accountant.
• H1: Computerization of accounting information system does not prevent increased speed of operation, processing and accuracy of output.

Hypothesis Two

• H0: Computerization of accounting information system does not prevent increase speed of operation, processing and accuracy of output.
• H1: Computerization of accounting system prevents increase speed of operation, processing and accuracy of output.

Hypothesis Three

• H0: Computerization of accounting information system not hamper the reliability and better storage of accounting information.
• H1: Computerization of accounting information system hampers the reliability and better storage of accounting information.

Hypothesis Four

• H0: The use of computer does not militate against accounting profession.
• H1: The use of computer militate against accounting profession.

Hypothesis Five

• H0: Computerization does not effect the employment of accountant to a large extent.
• H1: Computerization affects the employment of accountant to a large extent.

Research Questions

The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:

• Is computerization an aid, a burden or a hindrance to a account?
• Are those benefits derived from computerization of accounting information?
• Is it possible to introduce computer is an existing company and how that take place?
• Does computers have effect on the performance of the accountant?

The researchers posed those question to enable her find out if computers system is important system in the processing of accounting information.

1.4 Significance of the Study

It is important that computerization would go a long way to enhance the overall effectiveness and efficiency of the accountants. In fact, it is very necessary to computerize accounting information for sound management decisions and implementation.

The importance of this study is to aid managers by way of drawing their attention to attainable ways of computer application in accounting information system. This will also help managers to enlighten the accountant on the benefits really derivable from a computer to the business vis-à-vis the planned investment outlay.

Also, this research will help to enlighten workers who feel and fear that computerization means displacement of their job. Moreover, this will serve as a projecting pad for further research in this field of study.

1.5 Scope and Limitation

It is imperative that a study of this magnitude will extent visits to a wide range of organization to elicit information from them. But this was not possible under the present dispensation.

Therefore the scope of this study was limited to United Bank for Africa PLC (UBA) and Euma consultant firm, with the hope that conclusions reaches in the course of the study would apply to other organizations.

Although every effort was made to ensure that realistic dependable results are arrived at, it is worth mentioning that the researcher encountered such problem.

1. High cost of research materials coursed by the irrelevant economic down-turn in the country.
2. Unwillingness of the respondents to give out certain useful information to avoid revealing organizational secrets.
3. Dearth of variable literature.

1.6 Definition of Terms

Computer

In this study computer are seen as an electronics devices which received data through the input devices (keyboard and magnetic tapes) process the data in the central processing unit (CPU) and gives out information at the output unit (Visual Display Unit VDU)

Compered Information

These are data received as input, processed and given out as information to user. (that is information that passed through computer)

Important System

This is a system that is important. But system itself is described as the detailed plan or management for the inter-relationship and interaction of available resources to accomplish a given task.

Accountant

A person whose job is to keep and examine the money accounts of a business.

Accounting

This is the process of identifying measuring and communicating economic to permit informed judgment and decision by users of the information.

Data

Data is a raw, unorganized, unprocessed, unarranged facts, and figures about a person or anything per say.

Processing

This is arrangement of an information in such a way that they can be understood

Device

A device is anything created by man with his mental capacity.

Electronic

Things made up of chips

Installation

Of a new computer system represents a major changes in the work routine of user. Careful consideration should be given to system conversion to create a minimize of disruption to business operations (i.e. an apparatus in a fixed state ready for use).