Full Project-EFFECTS OF COMPUTERISED ACCOUNTING METHOD AND CONTROL SYSTEM ON PRODUCTION

CHAPTER ONE

1.1   BACKGROUND OF STUDY

Accounting is the art of recording, classifying, and summarizing in a sufficient manner and in terms of money, transactions, and events which are of a financial character and interpreting the results thereof.

The effects of computerized accounting is very easy to see  in that, once the system is developed and install information, on any aspect of accounting is that financial information can be safely stored and retrieved as the need arises, for instance, manager of a firm may want the particulars of a debtor who has been owing for the past six (6) months and the computer will simply produce the information in just a matter of seconds, a work which could take about two  weeks or more to accomplish where only manual systems of recording transactions is being used. It no gain saying that modern businesses are growing bigger and more complex everyday.

Manual system of recording financial information is no longer coping with the rate of sophistication and competition in these modern industries. Management needs timely information for planning and it is only computerized accounting method and control system that can supply all the needed financial information immediately at the close of accounting period. Many institution both commercial and private, especially banks are finding it increasing difficult to process their financial dated speedily and accurately enough to satisfy their numerous customers. Lack of effective method of financial information in any modern organization hinders management plans and the resultant effect is poor productivity and a negative goal of every firm which is to maximize profit.

The dream of most of our commercial and private firms today is computerized accounting method and control system. Firms are tired of hiring auditors to audit financial statement of the firm due of some certain vital accounting documents might be missing or improper records are kept. For effective and efficient production, management needs timely information for planning and forecasting, computerized Accounting System can give an effective solution to these problems.

1.2     STATEMENT OF THE PROBLEM

This study entitled the “Effects of Computerized Accounting Method and Control Systems on Production” attempt to determine the effects of automated accounting system on production.

There are numerous problems associated with the use of human labour alone to process accounting information. In many cases errors such as errors of commission and omission, aver-statement and under-statements of account have set organization back on their courses. Sometimes these mistakes are not discovered until a considerable loss has be caused to the firm. In calculations involving fractions many firm has loss a substantial sum of money due to error of miscalculation and the resultant effect on over all production in decrease in efficiency which many organization strive to attain. We have seen  a good number of occasion where the trial balance or the balance sheet could not balance either because the account was over stated or under stated which subsequently lead to setting up of a suspense account.

Another problem associated with banks is the time wastage on cashing or cheque depositing or withdrawal on an account; we must have witnessed at one time or the other in the commercial banks where the customers were lamenting because of the delay on the part of the bank workers to give the customer timely service. It is said that time is money and as such no person would like to spend a whole at bank just to withdraw money, a thing which could be done with five minutes if the accounting system is computerized.

The researcher is also looking into the problem of difficulty in assembling accounting information especially when subjected to pressures are bound to make mistakes which in many occasion made firm to suffer loss. Also human being is subject to fatigue and any work done under such condition is likely to contain errors.

In summary. Based on the problems identified above ,  the use of clerical effort alone to process accounting information will produce result full of errors which eventually leads to of profits., inadequate information for management planning, loss of time and general decrease in over all economic growth of the nation. These as enumerated are not surmountable if appropriate system is applied and only that can provide adequate solution is computerized accounting system.

1.3            PURPOSE OF THE STUDY

By purpose of the study the researcher means the prime objective he has in mind. One of the objectives is to create awareness on the use of computer to process accounting information and the ultimate benefits accruing there from.

Many people and organization have the notion that if business transactions are computerized, it will lead to more unemployment problems but it is not true. Country like the USA has a far lesser unemployed graduates than Nigeria, yet USA has computerized almost everything they do including business and non business aspect of life, making use of digital and non digital computers.

Again there are numerous benefits currently enjoyed by the organization using computerized accounting system, every other organizations, both the big and small ones should equally share in such benefits, since what is good for the is also good for the gender.

The question is “how can small firms which cannot afford to buy a computer of their own enjoy the benefits of using computer to process their business transactions?”  the answer has already been stated in earlier part of this chapter and that is by commercializing the use of computers to process