THE IMPACT OF COMPUTERIZATION OF ACCOUNTING SYSTEM IN A BUSINESS ORGANISATION

CHAPTER ONE

1.1       INTRODUCTION

Computer as an automated sophisticated high technology, has come to have potential significant effect on business profession such as accounting.

With modern days development accountants specialized knowledge and expertise is directed to collecting, collating, interpreting and communicating a wide range of accounting information needed for a sound day-to-day control of the use of resources. The impact o computerization of accounting system in a business organisation can be analysed with positively and negatively  but nevertheless the positive effects are much more than the negative effects.

1.2    BACKGROUND OF STUDY            

Accounting practices have changed exceptionally and rapidly in the last decades, particularly because of changes of laws and standards.  Accountants and goes through stages in the preparation of financial statements and other accounts.

First is the dependence on foreign standards such as International Accounting Standards (IAS) Financial accounting Standard  Board, Besides the issuing of Statement of Accounting Standards (SAS), the Nigerian Accounting Standard  Board (NASB) is saddled with two major responsibilities.

These are:

1.           To ensure that financial reporting satisfy legal requirement stipulated in company and Allied Matters Acts of 1990.

2.           To ensure that the prepared financial statements and accounting confirm with international standard (NASB), 1984. Accounting system in a business organisation is changing with new markets springing up such as the proliferation of banking establishment and establishments of new newspaper.

These new establishments usually computerized their operations. Some of them employed Data Base Management system (DBMS) like Newswatch magazine. The employment of computer bring about a reduction in the time taken to process data and produce output, easier access to store data, increasing processing capacity without an increase in staff and an overall improvement in the quality of management information, better management report that are relevant to manager’s work, produced more accurately and on time due to the positive effects of computerization. Coping with effects of computerization in accounting system in a business organisation which brought about changes necessitates the inclusion of courses in data processing, system analysis and designs in the examination of most professional bodies like I.C.A.N and C.I.M.A. Infact, in many companies nowadays where computers are used extensively, their accountants are sent on further training system analysis and design.

1.3    STATEMENT OF PROBLEM                        

The strategic analysis of problems facing a computerized accounting system and by implication, it means that the accuracy of these statement is very important to be dealt with as it affects the extent of dependability and subsequent utilization of information.

The statement has to do with how computerized accounting system has been able to have impact of effects on the volume of work, quality of services demanded by clients, saving time of customers and to effect changes in cost, revenue and profit of an business organisation.