BACKGROUND period. According ISAB Framework for preparation and

BACKGROUND TO THE STUDY

The essential goal of a Accounting function in an
organization is to process financial related information about the exercises of
the organization and prepare financial statements toward the end of the
Accounting period. According ISAB Framework for preparation and presentation of
financial statement, the objective of financial statements is to provide
information about the financial position, financial performance and changes in
financial position of a company that is useful to a wide range of users in
making economic decisions. These financial statements are usually directed towards
the common information needs of these users and as a result, it serves as their
major source of financial information. Users of these financial statements
include shareholders, prospective investors, employees, customers and
government. Many years back the accounting reporting was done through
traditional way and recently due to the changes in technology the reporting has
been done through computerized accounting systems (CAS).

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The aim of financial reporting through computerized
accounting system is to produce accurate records, efficient book management, to
avoid errors and ultimately improving the management of their business (Ahmed,
2006). Every business has various processes, some simple, others complex and
cumbersome. But as the business develop, acquires new customers, enters new
target and keeps pace with constant changes in computer technology, companies
need to maintain highly perfect and up-to-date accounting, inventory and
statutory records. This is where a Computerized Accounting System helps simplify,
integrate, and streamline all the business processes, cost-effectively and
easily and helps presents the true picture of all the business undertakings to
users of financial reports. With the decrease in the price of computers and
accounting programs, this method of financial reporting is becoming popular (Raymond
& Bergeron 1992).

For the past years, small business enterprises in
Nigeria were characterized as essentially rearward in the wheel of the overall
development of the Nigeria economy. Because of this, there has been a prevalent
feeling that small businesses could be assisted only for social reasons, not as
a promising opportunity for national development. Obviously, little attention
has been paid to the benefits to be derived from helping small business of
modernize and grow.

Small and Medium Scale Enterprises
have played a key role in the economies of both developed and developing
countries in terms of turnover, level of employment and serve as a mechanism to
fight against poverty as evidenced in the literature (Akanji, 2006; Akintoye
and Oladejo, 2008; Akande, 2013). The current wave of information technology
calls for the attention of small and medium scale enterprises in the 21st
century. E-commerce, according to Bansal and Sharma (2006), is rapidly
transforming the way of businesses functions are performed, posing new
challenges to the entrepreneurial profession. Accordingly,
there is an increasing consciousness of the necessity to derive profit through
investment using computerized accounting system within SMEs. Information
Technology tools can significantly assist SMEs by supplying the required
infrastructure, which is necessary for providing appropriate types of information
at the right time. Information Technology can also provide SMEs with
competitiveness through integration between supply chain partners and
inter-organizational functions, as well as by providing critical information.
However, prior IT literature has shown that only a small number of studies
focused on the adoption and use of IT in SMEs (Morteza, Tang, Mohammad &
Norizima, 2012). Accounting system in common use
ranges from simple system in which accounting records are maintained by hand to
sophisticated system on magnetic disk. The accounting to be used in any given
company should be well tailored to the size and to the information need of the
business in a computer based accounting system, he accountant need only to
enter the data needed for the computer to prepare journal entries. All the
writings and postings to general ledger and subsidiary accounts are then
handled by the computer (Omotosho et al; 2012).

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