ABSTRACT
Currently,
most organizations continue to increase spending on information system and
their budgets continue to rise. Moreover, economic conditions and competition
create pressures about costs of information. Generally, information system is
developed using information technology to aid an individual in performing their
job. Therefore, most organizations focus on developing information system in
order to support decision system, communication, knowledge management, as well
as many others. The key part of information system needed for decision making
in organization is accounting information system. Management relies heavily on
information generated from the accounting standard employed by the company.
Quality reports are very key to arrive at an ideal investment. The design of
the study is descriptive research method. In addition both qualitative and
quantitative methods were applied in data collection and analysis. The
descriptive design is found to be suitable because it addresses major
objectives and research questions proposed in the study adequately. The
findings of this study indicate that Accounting Systems are an important
mechanism for organizations’ effective management, decision-making and
controlling activities. The results are consistent with empirical reviews which
indicated that there exists a relationship between accounting system and
organizational performance. The study concluded that accounting system are
critical to the production of quality accounting information on a timely basis
and the communication of that information to the decision makers. In other
words, empirical findings indicated that accounting information systems have a
greater impact on the organizational effectiveness of Nigerian Breweries PLC.
CHAPTER ONE
INTRODUCTION
1.1 Background to the
Study
Accounting system
is a system designed to record accounting transaction involving a business or
event taking into cognizance the policies of the firm. According to Hartzell
(2006) accounting system is the process of organizing, summarizing, recording
and reporting financial transactions with the view of providing financial
information to management to facilitate policy decisions, budgeting, preparing
financial report and other financial approvals. Accounting system is viewed as
formal systems which identify measure, accumulate, analyze, prepare, interpret
and communicate accounting information of a business organization or
institution (Ama, 2004). Accounting system is regulated by the organizations
policies, rules, regulations, methods, procedures and techniques.
Accounting systems
constitute the mechanism adopted for gathering and communicating the financial
performance and position of the organization. The two major types of Accounting
System include Manual Accounting system and Computerized Accounting System. The
manual system involves the use of hand for the posting of accounting
information into the various books of accounts of the firm. The computerized
system involves the use of specialized machines as computer in gathering and
processing of accounting information. It is also referred to as Electronic Data
Processing (EDP) Accounting System. The applications of computer in accounting
system involves the use of Word processor, Data base and Spread sheet
1.2 Statement of the
Problem
The accounting
system is besotted by some deficiencies. For example, the computerized
accounting system is exposed to the risk of data theft and loss either as
result of power failure or from hackers. It is also exposed to fraud by those
who can secretly have access to the system. Customer information could be
tampered with in the process thereby leading to security breach. The management
could be deterred in some cases where there is loss of data in executing
legitimate projects and decision making. According to Vermaat and Shelly (2011),
computers related problems include health risks, the violation of
privacy, public safety, the impact on the labor force, and the impact on the
environment. Therefore, the problem confronting the research is to appraccounting
systeme the Effectiveness of accounting system and its impact on the
performance of Nigerian breweries plc.
1.3 Objectives of the Study
To determine the
Effectiveness of accounting system and its impact on the performance of
Nigerian breweries plc.
1.4 Research Questions
i.
What is Accounting
system?
ii.
What is the effectiveness
of accounting system and its impact on the performance of Nigerian breweries
plc?
1.5 Significance of the Study
The study elucidates
on the nature of accounting system and highlight its impact on the
performance of Nigerian breweries Plc. This
study is very important and most significant at this period when companies with
impressive income statement and statement of financial position are still faced
with continuity threat.
Accounting
system is “Prima Facie” evidence on the state of affairs of companies as well
as its performance and could be relied upon as a certificate because it has the
auditors’ certification. This study offers solutions to the above raccounting
systemed questions, it is my believe that the result of these finding will go a
long way to help other researcher in this area of study. It will also enhance
the understanding of the structure of published financial accounting
information and accounts by the users.
The
various users’ groups of published financial statements will benefit from this
study as follows:
a) The potential investors: These
are groups who are interested in committing their financial resources to the
purchase of the company’s share. The set of people will benefit from this study
as the result of this study will arm them with the necessary tools with which
to evaluate the financial accounting of a business organization as it affects
them.
b) The general public: This group
shall benefit from this report by knowledge that the business organization
exists for them not against them and such has to live up to its full
responsibilities
c) The regulators of financial
Accounting Report: This group includes the Nigerian Accounting Standard Board
(NASB), the companies and Allied Matters Act (CAMA), the Banking and other
financial institutions act of 1991 (BOFIA), prudential guidelines for licensed
banks, the insurance act 2003. The study will help them to standardize and harmonize
their operations.
d) The employee group: This
include existing, potential and past employees
e)
The
government including Tax Authorities Department who has interest in the
financial accounting of companies: The result of this work shall be of immense
assistance to these user groups in the advancement of their interest.
1.6 Research
Hypothesis
Ho The
impact of accounting system on the performance of Nigerian breweries plc.
is low
Hi The
impact of accounting system on the performance of Nigerian breweries plc.
is high
1.7
Scope of the Study
This
study could have covered the impact of financial accounting on business
performance of all sectors of the Nigeria Economy but due to the challenges of
such a task especially the financial resources with which to execute it, this
is now limited to brewery industry. The study of Nigeria Breweries Plc Ibadan,
Oyo State.
1.8
Definition of Terms
ACCOUNTING SYSTEM
Accounting
system is a system designed to record accounting transaction involving a
business or event taking into cognizance the policies of the firm. According to
Hartzell (2006) accounting system is the process of organizing, summarizing,
recording and reporting financial transactions with the view of providing
financial information to management to facilitate policy decisions, budgeting,
preparing financial report and other financial approvals. Accounting system is
viewed as a formal system which identifies measure, accumulate, analyze,
prepare, interpret and communicate accounting information of a business
organization or institution.
AUDITOR
An
auditor is someone who is responsible for evaluating the validity and
reliability of a company or organization’ financial statements
STATEMENTS
OF FINANCIAL POSITION
Formerly
called balance sheet. A statement that shows the state of affairs of a company
by depicting its assets, liabilities as well as its equity.
BANK
An
establishment authorized by a government to accept deposits, pay interest,
clear checks make loans, act as an intermediary in financial transactions, and
provide other financial transactions, and provides other financial services to
its customers.
GOVERNMENT
An
institution of the state whose responsibility is to maintain law and order in
the society.
FINANCIAL
REGULATOR
Is
an institution that supervises and controls a financial system. Their objective
is to guarantee fair and efficient markets and financial stability