Project – Automated accounting processes and performance of deposit money bank in Nigeria.

CHAPTER ONE

INTRODUCTION

• Background to the Study

Automated accounting processes have significantly transformed the banking sector, particularly in Nigeria’s deposit money banks. The adoption of automated accounting systems has been driven by the need to improve efficiency, accuracy, and speed in financial transactions and reporting (Adeyemi & Salami, 2011). These systems have been instrumental in reducing human errors, enhancing data security, and improving the overall performance of banks. Adeyemi and Salami (2011) further argue that automated accounting processes have led to improved financial control, better decision-making, and increased profitability in Nigerian banks.

The impact of automated accounting processes on the performance of deposit money banks in Nigeria has been the subject of several studies. For instance, Oyewole and Egbide (2012) found a positive relationship between the use of automated accounting systems and the financial performance of banks. They attributed this to the ability of these systems to process large volumes of transactions quickly and accurately, thereby reducing operational costs and improving customer service. Similarly, Ojeka (2012) found that automated accounting processes have led to increased efficiency and profitability in Nigerian banks.

However, the adoption of automated accounting processes is not without challenges. According to Okoye and Ezejiofor (2013), some of the challenges faced by Nigerian banks include high implementation costs, lack of skilled personnel, and resistance to change. They also noted that the success of these systems largely depends on the level of computer literacy among the staff and the quality of the software used. Despite these challenges, they concluded that the benefits of automated accounting processes far outweigh the costs.

In addition to the above, the regulatory environment in Nigeria has also played a significant role in the adoption of automated accounting processes. The Central Bank of Nigeria (CBN) has been at the forefront in promoting the use of these systems in the banking sector. For instance, the CBN introduced the Bank Verification Number (BVN) in 2014, which has significantly improved the accuracy and reliability of customer data (CBN, 2014). This has, in turn, enhanced the effectiveness of automated accounting processes in Nigerian banks.

Despite the significant strides made in the adoption of automated accounting processes, there is still room for improvement. Future research should focus on exploring the potential of emerging technologies such as artificial intelligence and blockchain in enhancing the performance of deposit money banks in Nigeria. Moreover, there is a need for continuous training and development of staff to ensure that they are well-equipped to handle these systems.

Automated accounting processes have significantly improved the performance of deposit money banks in Nigeria. However, there are still challenges that need to be addressed to fully realize the potential of these systems. Therefore, it is imperative for banks to invest in the right technology and human resources to ensure the successful implementation of automated accounting processes.

• Statement of the Problem

The problem of inefficient accounting processes in the banking sector has been a significant issue in Nigeria. Traditional manual accounting methods have been characterized by errors, delays, and inefficiencies, which have negatively impacted the performance of deposit money banks (DMBs) in the country (Adeyemi & Salami, 2011). The lack of automation in accounting processes has led to increased operational costs, reduced customer satisfaction, and decreased profitability.

The adoption of automated accounting processes in Nigerian DMBs has been slow and fraught with challenges. Despite the potential benefits of automation, many banks have been reluctant to fully embrace this technology due to factors such as high implementation costs, lack of skilled personnel, and resistance to change (Oyewole, Abba, & Moguluwa, 2013). This has resulted in a gap between the potential and actual performance of these banks.

Furthermore, there is a lack of empirical evidence on the impact of automated accounting processes on the performance of DMBs in Nigeria. While several studies have explored the benefits of automation in the banking sector, few have specifically focused on its impact on accounting processes and bank performance (Oyedokun, 2015). This has left a gap in the literature and an unanswered question about the true value of automation in this context.

Moreover, the existing literature has largely ignored the potential negative effects of automation. While automation can improve efficiency and accuracy, it can also lead to job losses and increased vulnerability to cyber threats (Adeyemi & Salami, 2011). These potential downsides need to be explored to provide a balanced view of the impact of automated accounting processes on DMBs.

In addition, there is a need for research that explores the specific factors that influence the successful implementation of automated accounting processes in Nigerian DMBs. Understanding these factors could help banks overcome the barriers to automation and improve their performance (Oyewole, Abba, & Moguluwa, 2013).

The problem of automated accounting processes and the performance of DMBs in Nigeria is multifaceted and requires further investigation. This research aims to fill the gaps in the literature and provide insights that could help Nigerian DMBs improve their accounting processes and overall performance.

• Aim and Objectives of the Study

The aim of the Automated accounting processes and performance of deposit money bank in Nigeria. The specific objectives are:

1. To examine the extent to which automated accounting processes have been adopted in deposit money banks in Nigeria.
2. To evaluate the impact of automated accounting processes on the performance of deposit money banks in Nigeria.
3. To identify the challenges faced by deposit money banks in Nigeria in implementing automated accounting processes.
4. To assess the relationship between automated accounting processes and the efficiency of deposit money banks in Nigeria.

• Research Questions

The research questions are buttressed below:

1. To what extent have automated accounting processes been adopted in deposit money banks in Nigeria?
2. What is the impact of automated accounting processes on the performance of deposit money banks in Nigeria?
3. What are the challenges faced by deposit money banks in Nigeria in implementing automated accounting processes?
4. Is there a relationship between automated accounting processes and the efficiency of deposit money banks in Nigeria?

• Research Hypothesis

The hypothetical statement of the study is buttressed below:

Ho: Automated accounting processes has no significant impact on the performance of deposit money banks in Nigeria

H1: Automated accounting processes has significant impact on the performance of deposit money banks in Nigeria

1.6 Significance of the Study

The significance of this study on automated accounting processes and the performance of deposit money banks in Nigeria cannot be overstated. The banking sector is a critical component of Nigeria’s economy, and its efficiency and effectiveness have far-reaching implications for the country’s economic growth and development. By examining the adoption and impact of automated accounting processes in these banks, this study provides valuable insights that could help improve banking operations and, by extension, Nigeria’s economic landscape.

Firstly, this study is significant as it provides an in-depth understanding of the current state of automated accounting processes in Nigerian deposit money banks. By examining the extent of adoption, the study sheds light on the level of technological advancement in the banking sector. This information is crucial for policymakers and stakeholders in the banking industry as it provides a benchmark for future improvements and innovations.

Secondly, by evaluating the impact of automated accounting processes on the performance of deposit money banks, this study provides empirical evidence that could guide decision-making in the banking sector. If the findings indicate a positive impact, it could encourage more banks to adopt these processes, leading to improved efficiency and performance.

Thirdly, this study is significant as it identifies the challenges faced by deposit money banks in implementing automated accounting processes. Understanding these challenges is crucial for developing strategies to overcome them, thereby facilitating the successful implementation of these processes

Fourthly, the study’s assessment of the relationship between automated accounting processes and the efficiency of deposit money banks provides valuable insights into the potential benefits of these processes. If a positive relationship is found, it could serve as a strong argument for the wider adoption of automated accounting processes in the banking sector.

Lastly, this study contributes to the existing body of knowledge on automated accounting processes in the banking sector. It adds a Nigerian perspective to the global discourse on the subject, thereby enriching the literature and providing a basis for further research.

• Scope of the Study

The study examines Automated accounting processes and performance of deposit money bank in Nigeria. A study of Access Bank Plc.

1.8. Operational Definition of Terms

Automated Accounting Processes: This refers to the use of computerized systems and software to perform accounting tasks that were traditionally done manually. It includes tasks such as data entry, transaction recording, financial report generation, and reconciliation. Automated accounting processes aim to increase efficiency, accuracy, and speed in financial management.

Performance: In the context of a deposit money bank, performance refers to the effectiveness and efficiency of the bank’s operations. It can be measured in various ways, including financial indicators like profit margins, return on assets, and return on equity. Non-financial indicators may include customer satisfaction, market share, and the quality of services provided.

Deposit Money Bank: This is a type of bank that accepts deposits from the public and gives out loans. They are also known as commercial banks. In Nigeria, deposit money banks are regulated by the Central Bank of Nigeria. They play a crucial role in the economy by facilitating financial transactions, providing credit facilities, and contributing to monetary stability.

Project – Automated accounting processes and performance of deposit money bank in Nigeria.