CHAPTER ONE:
INTRODUCTION
|
||
1.1
|
Background of
the study
|
1
|
1.2
|
Statement of problem
|
4
|
1.3
|
Objective of study
|
5
|
1.4
|
Research questions
|
6
|
1.5
|
Research hypotheses
|
6
|
1.6
|
Significance of the study
|
7
|
1.7
|
Scope of the study
|
8
|
1.8
|
Companies Profile
|
8
|
1.9
|
Limitation of the study
|
9
|
1.10
|
Definition of terms
|
10
|
CHAPTER
TWO: REVIEW OF RELATED LITERATURE
2.1
|
Evolution of
accounting
|
12
|
2.2
|
Stages in
evolution of accounting
|
17
|
2.3
|
Purpose of
accounting information
|
18
|
2.4
|
Classification
and storing data in an accounting environment
|
20
|
2.5
|
Accounting in
the manual system environment
|
21
|
2.6
|
The nature of
integrated accounting software system
|
22
|
2.7
|
Checklist for selecting
accounting systems
|
24
|
2.8
|
Basic requirement of software
accounting data
|
25
|
2.9
|
Advantages of using accounting
software systems
|
28
|
2.10
|
Disadvantages of software
accounting system
|
29
|
2.11
|
Comparison between manual
Accounting system and
|
|
Software accounting system
|
31
|
|
2.12
|
Effect of software accounting
system on customers
|
33
|
2.13
|
Effect of software accounting
system on organization performance
|
33
|
CHAPTER THREE:
RESEARCH METHODLOGY
|
||
3.1
|
Research design
|
36
|
3.2
|
Sources of data
|
37
|
3.3
|
Area of the study
|
38
|
3.4
|
Population of the study
|
38
|
3.5
|
Determination of the sample
size and sampling technique
|
39
|
3.6
|
Validity and reliability test
of the instrument
|
40
|
3.7
|
Method of data collection
|
41
|
3.8
|
Techniques for data analysis
|
41
|
3.9
|
Decision criterion for
validation of Hypothesis
|
43
|
CHAPTER
FOUR: PRESENTATION OF DATA, INTERPRETATION AND
ANALYSIS
OF DATA
4.1
|
Presentation
of data
|
44
|
4.2
|
Test of
hypotheses
|
57
|
4.3
|
Discussion of
findings
|
72
|
CHAPTER FIVE:
SUMMARY OF FINDINGS, CONCLUSION AND
RECOMMENDATIONS
5.1
|
Summary of findings
|
73
|
5.2
|
Conclusion
|
74
|
5.3
|
Recommendations
|
74
|
Bibliography
|
76
|
|
Appendix 1
|
78
|
|
Appendix 2
|
79
|
|
CHAPTER ONE
INTRODUCTION
1.1
BACKGROUND OF THE STUDY
Accounting
system according to an Italian monk, Luca Pacioli (1491), is the
combination of
personnel records and procedures that a business uses to meet its need for
financial data. Financial accounting also encompasses the summary of
information and presentation of periodic reports such as profit and loss
statement and balance sheet. The historical firms of accounting were of
different degree of sophistication according to the need and techniques of the
time. This is why modern accounting is based on the double entry system and the
recognition of the dual nature of each transaction and this gives a co-ordinate
support for the control of all the transaction of a business.
Accounting system
according to business dictionary is an organized set of manual and computerized
accounting methods, procedures and controls established to gather, record, classify,
analyze, summarize, interpret and present accurate and timely financial data
for management decisions.
In spite of this, there
are policies for reporting on an organization performance and current
conditions. These policies increase the usefulness of report including their
reliability and comparability. The policy that makes up
acceptable accounting
practices are determined by many individuals and groups and those policies are
referred to as generally accepted accounting principles
(GAAP). Since
accounting is a service activity, these rules reflect our society’s needs and
not only on those of accountants. The financial Accounting standard Board
(FASB) is another body or group that is seen as an independent group of seven
full-time members with a large staff. This body has issued six statements of
accounting concepts which help in guiding accounting standard setting. Many
companies and organizations involve themselves in setting accounting
rules/policies. They include investors, government agencies, politicians,
unions, lenders and other business and non-business organizations.
Furthermore, there are
two major types of methods used in recording accounting information, such
methods are manual accounting system and software accounting system or
computerized accounting system.
Manual accounting
system extends and includes the method of processing, recording, journalizing
transactions posting to the ledgers and preparing the financial statements
which provide decision makers with useful information in making decisions.
These decisions relate to the allocation and use of scarce economic resources
such as money, land, labour and capital. These manual accounting systems are
wholly used for preparing income tax returns, reports to managers, bills to
customers and other forms of providing accounting information.
In addition, with
manual accounting system, accountants and managers usually inspect the
documents, journal ledgers and reports in the performance of testing and
verification. Transaction can be traced from source documents to journals,
general ledgers, printed report etc. Subsidiary ledgers can be posted and the
total can be compared with control accounts. It is visually observed by the
auditors or accountants to determine whether proper books of accounts or is being
followed.
Technology is a main
part of our modern society and business practices. It also plays a major
important in accounting as it help in reducing the time, effort and cost of
record keeping while improving clerical accuracy. Technology has distinct the
way we store, process and summarize large masses of data which makes accounting
free to increase its field.
The origin of software
could be dated back to early 1960s. Historically, emphasis in computer industry
was on programming and was seen as the biggest single problem in the
implementation of a computer system. Computer has the ability to add and
subtract, but frequently not to multiply or divide, the computer run with
relatively simple software routines.
However, this study
tends to analyze the comparison between manual accounting and software
accounting which are the two types of accounting system used by various
organizations and companies.
1.2
STATEMENT OF THE PROBLEM
In
recent times, most companies and
organizations have been using the
manual form of
operations in their accounting systems. Primarily, this manual accounting
systems used to meet the organizational information requirement but this has
been on consistent failure in recent times as a result of growth and
diversification of business and technological advancement complexities in
information technology to meet the current business demands.
Thus, companies and
organizations had usually been faced with a number of problems in the use of
this manual accounting system which involve lack of ability to handle
sufficient volume of data in terms of speed and accuracy, insufficient data
storage and retrieval system often resulting in loss of vital records,
incorporating final updates, rampant report of frauds and forgeries in the use
of the system, unseemliness of information which implies that information
needed for effective decision making . This is repeatedly, as a result of poor
retrieval and inability to collect large volume of data within the required
time. All these problems include consequence in great loss of scarce resources
and impeded organization growth, steadiness and advancement.
Hence, in attendance to
affect these problems related with the manual accounting system and substitute
it with the development of an integrated accounting software system where
financial and non-financial accounting
transaction are
recorded, analyzed, retrieved, reported, interpreted, summarized
and processed.
1.3
OBJECTIVE OF THE STUDY
The main
objective of this
study is a comparative
analysis of software
accounting
system and manual accounting system.
The study aims at ascertaining the
following objectives:
1.
To evaluate whether frauds and forgeries
are encourage in computerized accounting system i.e. software accounting system
than the manual accounting system.
2.
To examine whether software accounting
system can handle large volume of data than the manual accounting system.
3.
To study whether the use of software
accounting system increases effectiveness and efficiency in organizations or
companies than manual accounting system in reducing the amount of funds lost
through frauds and forgeries.
4.
To examine whether software accounting
system is capable of storing, retrieving, analyzing, processing, summarizing
and reporting rapidly than manual accounting system.
5.
To show the operational and reporting
system in both the manual accounting system and software accounting system.
1.4
RESEARCH QUESTION
The
course of this research has picked up some interesting enquires and
discussions which
centered more on a comparative analysis of software accounting and manual
accounting system in two companies Nigeria Breweries Plc. and Africa Petroleum
Plc in Enugu State.
The following questions are put
forward for the purpose of the study:
i.
What are the measures taken to ascertain
the extent to which fraud and forgery can be prevented and controlled using
either of the accounting system?
ii.
Can software accounting system handle
large volume of data more than the manual accounting system?
iii.
How effective and efficient is the use
of software accounting system or manual accounting system?
1.5
RESEARCH HYPOTHESES
Here the following hypotheses were formulated,
tested and validated in the
study.
Hypothesis
One
H0:
frauds
and forgeries are not encouraged with the use of software accounting
system than
manual accounting system.
H1:
frauds
and forgeries are encouraged with the use of software accounting system
than manual accounting system.
Hypothesis
Two
H0:
Software
accounting system is not able to handle large volume of data than the manual
accounting system.
H1:
Software
accounting system is able to handle large volume data than the manual
accounting system.
Hypothesis
Three
H0:
Manual
accounting system is not effective and efficient than the software accounting
system in reducing the amount of funds lost frauds and forgeries.
H1:
Manual
accounting system is more effective and efficient than the software accounting
system in reducing the amount of fund lost through frauds and forgeries.
1.6
SIGNIFICANCE OF THE STUDY
This study has a lot of significance to the
educational system and industrial
environments.
1. It impart
hold knowledge to the general
public who may not
have the
opportunity of
reading some relevant test on software accounting system as well as
manual
accounting system.
2.
It
creates new initiative in information expertise sub-sector.
3.
Non-computer experts with little or no
assistance will be exposed and encourage through this study.
4.
It
provides important literature for other researchers.
5.
It will promote productivity, efficiency
and effectiveness in industries since users satisfaction is assured as well as
error free and speeding reporting system.
1.7
SCOPE OF THE STUDY
The
coverage of this study is limited to the study of a comparative analysis
of software accounting
system and manual accounting system of which particular attention is given
using two companies in Enugu as study. These companies are Nigeria breweries
PLC (Enugu), African Petroleum PLC (Enugu).
1.8 COMPANIES PROFILE
NIGERIA
BREWERIES PLC
Nigeria Breweries Plc.
was incorporated on November 6th, 1996 as Nigeria Breweries limited and was
first commissioned in Lagos on 2nd June 1949, while
other branches were
established such as Aba branch in 1957, Kaduna 1963, Ibadan in 1982 and Enugu
in 1995.
AFRICAN
PETROLEUM PLC
The history of African
petroleum Plc. dates back to 1945 when the British petroleum company limited
bought up the assets of the Atlantic Refining Company on the West Africa coast.
In1964, AP Nigerian limited was incorporated in Nigeria. As an associate of the
world wide AP group, it marketed petroleum throughout the federal Republic of
Nigeria. In 1973, the company changed from a private company to public company,
when 40% of its shares were sold to Nigerian citizens in compliance with
provisions of Nigerian Enterprises promotion decree of 1977.
1.9
LIMITATION OF THE STUDY
There
is no research work or study that is entirely hitch-free. During the
course of this study, a
lot of problems prompted up. The main limitation of this research work is time
factor. The researcher had limited time with which he used in completing the
study. This also created a room for other problems and made data collection a
difficult task.
The problem of finance
cannot be ruled out any research work of this entails
typing, photocopying,
transportation etc. The unavailability of material with which to work with
constituted the limitation of the research work.
The study is however
limited to these companies. Nigeria Breweries Plc. 9th mile Enugu metropolis,
African Petroleum Plc. Presidential road, Enugu. As well as the following
financial areas: Such as general ledger, account payable, account receivable,
purchasing, inventory control and cash resources. The research will also
provide overall information on software such as peach tree accounting system
for windows implementation procedures involved.
1.9
DEFINITION OF TERMS
SYSTEM: It
is an interrelated or interacting element organized into a complex whole.
A system is a group of interrelated components working together towards a
common goal by accepting inputs and producing outputs in an organized
transformation process.
SOFTWARE: It
is a general term for the various kinds of programs used to operate
computers and related devices. Software is the programs and symbolic languages
that control the function of the hardware.
MANUAL ACCOUNTING
SYSTEM: These are those system in which source document
are posted by hands which extends and includes method of processing,
recording, journalizing
transactions posting to the ledgers, sales, cash receipt and other type of
journals.
ACCOUNTING SYSTEM: It
is an organized set of manual and computerized accounting methods,
procedures and controls established to gather, record, classify, analyze,
summarize, interpret and present accurate and timely financial data for
management decisions.
ACCOUNTING: It
is a system for recording; classifying, measuring, interpreting financial
data for an organization to enable users make assessment and decision making.
COMPUTERIZED
ACCOUNTING: It
is what businesses used to track their
financial
information.
COMPUTERIZED ACCOUNTING
SYSTEM: for recording their financial information. Every
entry is made into the system.
TO GET THE COMPLETE MATERIAL CLICK HERE
No comments:
Post a Comment