AN ASSESSMENT OF THE USE OF COMPUTERIZED ACCOUNTING SYSTEMS IN SELECTED BUSINESSES IN BUEA MUNICIPALITY

ABSTRACT

Accounting has evolved from the use of pens and papers in preparing financial
statements to the use of simple arithmetic calculators and now Computerized
Accounting Systems(CAS) that with just one click financial statements are
produced. The topic of this study is “An Assessment of the Use of Computerized
Accounting Systems in Selected Businesses in Buea Municipality”. Its main
objective is to assess the use of Computerized Accounting Software (Sage sari,
QuickBooks and Microsoft excel) in recording and presenting financial statements
in selected businesses in Buea.

The selected businesses here are businesses in the
tertiary sector in Buea using CAS and the random sampling technique was used to
choose the sample businesses that will represent our target population. Primary
data was collected with the use of 40 questionnaires that was answered by
accountants of the target businesses.

Frequencies and percentages were used to
analyze data through SPSS and Microsoft Excel and the results were showed on
tables, bar charts and pie charts. In terms of simplicity it was discovered that Sage
sari, QuickBooks and Microsoft excel require little computer and accounting
knowledge is required to record transactions. In terms of quality of recording and
financial statements, they have a feature for detecting recording errors and those
errors could be easily corrected.

In terms of security it was discovered that access
to the system can be controlled with the use of a password. Furthermore, it has an
antivirus that protects it from virus attacks, work in progress is automatically saved
when power failure occurs and lastly data can be backed up on cloud to use in case
something happens to the original copy.

All those afore mentioned CAS could be
recommended to beginners who have little computer and accounting knowledge, to
businesses who seek accurate, complete and simple to understand financial
statements and also to businesses who seek to protect their data(recordings) from
unwanted persons as these CAS have passwords to limit access to the system from
unwanted persons and they also have features that protects its information from
hackers and virus attacks

CHAPTER ONE:
INTRODUCTION

1.1 Background to Study
In the accounting procedure, computerized accounting has become inevitable
for recording of business events and transactions and for the formulation of
financial statements since the invention of computers. Some of the features that
makes it so important is the fact that it requires little accounting knowledge, it
is accurate, it is fast, availability of auto report generation, reduces fraud
possibility, it is secured, availability of back up just to name a few (Bahati,
2014). Some of the examples of this accounting systems are sage, quick books,
Peachtree, Excel pro, Tompro, Odoo, sun system, flesh accounting just to name
the few.

The most common accounting software in America is Peachtree, that
of Asia quick books and the CEMAC zone sage.
According to Ankomah et al., (2012) Pen and papers has been used in the past
to identify business transaction, summarize and classy them, record them in the
respective journals, post them to the ledger accounts, draw the trial balance, do
the end of year adjustments and prepare the financial statements
(comprehensive income statement, statement of financial position, cash flow
statements, and statement of equity and notes of managers). It achieved the
goal for which it was used for but had so many disadvantages. Some of these
disadvantages of manual accounting were, high possibility of numerous errors,
time consuming, lack of security, lack of backups, space consuming, storage of
hard could easily be damaged just to name a few (Bekele, 2017). Because of its
numerous disadvantages there was a need to integrate technology into
accounting in other to eradicate or reduce these demerits.

Accounting was discovered many years before computers. In the 1880s
American William invented the adding machine, which enabled accountants to
carry out arithmetic calculations more efficiently and accurately. At the end of
the 18th century Herman Hollerith had developed a punch-card machine and it
was used by accountants to speed up data handing, in 1986 Peachtree, one of
the first accounting was created, it kept on evolving till today when we have
hundreds of computerized accounting that keep on updating its features
(Fraser, 2019)
The purpose of accounting through computers is to obtain better records, to
eradicate misstatements, efficient data management and most importantly
improving the overall management of businesses.

The use of computerized
accounting systems makes the production of relevant, reliable and accurate
records more effective and effective and efficient. Computerized accounting
systems is helps amalgamate and simply all financial transactions of business
procedures and also reduces the operation cost of recording financial
transactions (Ahmed, 2006 as cited by Saleh 2011).
Presently, transactions are recorded into application software’s with the use of
ICT and with the use of intranet or extranet and the business transactions are
instantly processed and accounting statements are produced with little or no
additional work. GAAP (Generally Accepted Accounting Principles) is used
produced these computerized accounting soft wares in other to be able to
permit them produce accounting statements according to with an acceptable
accounting framework (Adomako, 2013). According to Raymond et al., (1995),
the use of this book keeping technique is gaining more grounds with the fall in
the acquisition cost of computers and accounting soft wares.

1.2 Statement of the Problem