CHAPTER ONE

INTRODUCTION

1.1    BACKGROUND OF THE STUDY

Today’s modern technology brought
into use the computer, this  technology
is the application of science to gathering, recording, processing and
communicating of business information by means of electronic media. Most
commonest tool for application is the computer and it involves all the
transaction processing system management information system various business
support system etc. The computer is a central force in the advancement of
various organization. The historical development of computer started with
Hollerith punched card of

1880,Goerge Alken calculator
and Charles Babbage’ creation of the difference engine.

The computer can be defined as a
tool or device which is able to accept facts (data) and figure in a prescribed
form, apply prescribed processes to data and supply result of the processes in
a specified format as a meaningful information. There are also different types
of information depending on the make or type of their functions. The revolution
in technology to the computer complements or in the other hand, substitute for
ten elements which are: – paper, personal memos, charts, reports, calculators,
terminals letter.

Hartzell (2006) defines computer
as an electronic machine for processing information automatically and very
quickly. The important of computers is the ability to handle vast amount of
information and to do other processes with accuracy and speed which cannot be
manually undertaken have been recognized and appreciated by financial institutions,
hence the trend in the computerized of banking operations.

Tanembaum (2010) sees computer as a
machine that can solve problems for people by carrying out instructions given
to it.

The American Accounting Association defines
accounting as the process of identifying, measuring and communicating economic
information to permit informed judgement and decision by users of the
information. Accounting is also the establishment, maintenance, collection and
analysis of financial position of an organization and any changes that have
occurred or may occur overtime.

Omolehinwe (2009) defines
accounting as the collection and recording of financial data about an
organization whether in the private or in the public sector and analyzing the
data so collected to suit the decision that needs to be taken and reporting the
relevant information in a summary form to the user in a form that is meaningful
to him or her.

Chionye (2003) defines accounting
system as the art of identifying, recording, classifying measuring and
interpreting in a significant manner the financial transaction of an
organization for decision making. Summarizing from time to time the information
contained in the record, for its significant presentation and interpretation to
interested parties as an aid to decision making.

Accounting system is also defined
as a consistent way of organizing, recording, summarizing and reporting
financial transactions.

Computerization
is the installation of computers as a part of a process of automation.

Banking in Nigeria has witness
impressive development in recent time particularly within the last decade in
time with growth in economic activities and complexities, banking service have
expanded significantly in size and variety due to increased by computerization
of banks.

1.2STATEMENT OF THE PROBLEM

In
spite of the benefit of computer to banking industry and business generally
some problem are still left unsolved and new ones have been credited by the use
of computer itself problems

like;

The use of computer to keep
accounting records.

Another problem is the
displacement of labour hands in the accounting department and its union
implication and the problem of low turnover (volume of operation) and
profitability in banks.

1.3 OBJECTIVES OF THE STUDY.

The objectives of this study are:-

§    
To determine he relationship between the
application of the manual accounting system and the computerized accounting
system in the banking system.

§    
To find out, whether the effect of computerized
accounting system enhances higher turnover (volume of operation) and

profitability in banks.

§    
To examine the impact of using computer to keep

accounting records.

1.4 RESEARCH QUESTIONS.

 To be able
to achieve the above purposes, some questions would be asked which help the
researcher to gather the necessary information needed, they are:

§    
Are there any relationship between the manual
accounting system and the computerised accounting system in the banking
industry?

§    
Also can computerized accounting system enhance
high turnover and profitability in banks?

§    
Finally, What are the effects of using computers
to keep accounting records?

1.5 HYPOTHESES OF THE STUDY

 In order to
ensure the verification and validation of the primary data gathered through
administration of questionnaires. A research hypothesis is formed comprising
the null hypothesis (Ho) and the alternative hypothesis (Hi).

Hypothesis One

Ho: – There is no relationship
between the application of the

Computer and manual system in the accounting system of
banking industry

 Hi: – There is a relationship between the
application of the

Computer and manual system in the accounting system of the
banking industry.

Hypothesis Two

Ho:- The impact of computerized accounting system does
not             enhance
higher turnover and profitability in banks. Hi:-  The impact of computerized accounting system
enhances       higher turnover and profitability in banks.

Hypothesis Three       

Ho:- There is no effect of
using computer to keep accounting 

          records.

Hi:- There is an effect of
using computer to keep accounting 

          records.

1.6  SIGNIFICANCE OF THE STUDY.

 Most banks
have growth and continuity as part of their objective, and such objectives are
best realized by an efficient management, as well as effective computerized
accounting system. This has made it possible for banks to gain inherent
advantage while minimizing risks involved in their daily operations.

 This research project will therefore be of
immense

advantage or benefit to the
management of banks, computers and other business organization using
computerized accounting system. Hence, the theories and concept contained
therein can be infused into their management system.

 This research will also contribute to enhance
efficiency in the following ways;

a)          
Speedy and accurate decision making through the use of
computerized accounting system.

b)          
Improvement in the delivery and quality service.

c)          
The banks profitability will be improve.

 Firstly, in
the realm of academic, the project will be very useful to wide audience as it
applies to courses in accountancy, banking and finance as well as executive
development courses, management seminars and supervisory workshop conducted in
colleges and universities.

1.7  SCOPE AND LIMITATIONS OF THE STUDY.

 The scope of
the study is restricted to examining the effect of computerized accounting
system on the performance of banking industries such as, Diamond bank plc, Eco
bank plc and First bank plc all in Enugu metropolics of Enugu state.

1.8  DEFINITION OF TERMS

AUDIT TRIAL:- a
technique that made it possible to retrace processing of data in all other to
charge, add or delete records in

a file.

BLOCKING:- the storage of more than one term in a record.

COMPLIER:-
a programming system applied by a manufacturer to convert a programme written
in an automatic language into machine language.

EXPERT SYSTEM:- A computer system which embodies some of the
experienced and specialized knowledge of an expert. it  enables a non-expert to achieve comparable
performance to an

extent in the field.

APPLICATION PACKAGES:- These are computer programmes

written for the purpose of carrying out specific task for
individuals or organizations with similar or related needs.