Effects of Accounting Information Systems on the Profitability of a Company
Objective of the study
The main objectives of this study is to examine the effects of accounting information system on the profitability of the company.
The specific objectives are
To examine the effect of accounting information system on profitability
To ascertain the effect of sales volume on profitability
To determine the effect of capital structure on profitability
To examine the effect of expenses on profitability
REVIEW OF RELEVANT LITERATURE
Sikula (2006) asserts that: All accounts have to receive some form of information. Even a skilled man joining an organization or institution has to be shown some aspects of his information. He may have to be instructed on how to pass information on the procedures relating to accounting system, cost accounting and other routines.
Ducasses (2005) said Information system for some specific operators, there is also a need to educate them so that they can become more skilled in a particular occupation in order to have a wider or general knowledge of techniques likely to be required in the future.
When training an Accountant in the basis of accounting information it is recessing to broaden the outlook, rather than train them in a particular information skill. The differences in approach at various accounting levels should be dared from a study of other part of information.
Some accounting experts leave the bulk of information system to their rivals. They then pay attractive wages and salaries and recruit accounting expert who have already received all formal education and accounting. However, this seems to be a very short – sighted policy. How morale and loyalty are not obtain merely by paying high overages.
Furthermore, Sikula (2006) said with a proper accounting information system there is more hope of obtaining the desired quantities and qualities of an accounting personnel.
RESEARCH DESIGN AND METHODOLOGY
The research is targeted at assessing the impact of of accounting information system on profitability of Nigeria manufacturing firm. This chapter focuses on the method through which data and information required for the study were obtained.
Research design in the study is purely descriptive survey method. A descriptive surveys method of research involves a careful observation of the existing attributes of a particular event and gives pictures of a population
A study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitute of individuals or elements that are homogeneous in description (Prince Udoyen: 2019). In this study the study population constitute of all the staff at cadbury Nig. PLC.
PRESENTATION AND ANALYSIS OFDATA
In this chapter, those data collected will be presented and analyzed. Both sources of data are worth analyzing but only the primary source shall be presented which comprises of personal interview and questionnaire forms. Each of these data will be broken down and examined vividly with a view to drawing conclusion and recommendations at the next chapter of this project.
SUMMARY, CONCLUSION AND RECOMMENDATIONS
Accounting is as old as the work business itself resuming a new dimension as changes in business world are taking place.
Though accounting is not totally conceived as an information system by some people, it will continue to be the major information system to be relied upon by management of any organization and schools in its decision making process. Accounting has gone beyond the conventional score keeping function. It has extended to attention of directing and problem solving, which are to aid management in its function of planning, controlling and decision making. Accounting information is to aid management in making relevant decision making and assist in hard situation. Apart form this, the information should timely accurate concise and objective. There has been a transitional stage from manual data processing to electronic data processing in many modern businesses.
However, the findings reveal the important of accounting information system in management decision making as well as its important to country at large. This will encourage organizations, schools and government to use information of accounting sector in making her decision.
Having carefully conducted this research, it is the researcher candid opinion that study of this kind should be encouraged especially at this period of technological advancement within the institution/school. Accounting information system has lapses that can easily be identified. We feel not satisfied to have delved into this area of specialization and prospective scholars to see accounting information system as an interesting field of study.
It is advisable that every institution/school need to have its own accounting information center, so that records of previous accounting programmed could easily be retrieved from the accounting department. It is unequivocal therefore, that proper identification of accounting needs of every staff can be handicapped due to the inadequacy of accounting information and to the complete absence of qualified and competent accounting specialist to the job.
The study revealed that accounting performance a crucial role on management decision and organization performance which has been shown to be major force in the decision making. This is achieved by implementing the best fundamental concept of accounting suitable for each institution.
Studies have shown that successful utilization of accounting information requires a fit between three factors: first, a fit must be achieved with dominance view in the perception or origination of the situation. Second, the accounting system must fit when problems are normally solved, i.e. the technology of the organization. Finally, the accounting information must fit with the culture i.e. the norms and value system that characterized the institution.
- For the school/institutions to set high qualities information from the system, it requires software for optimal application of accounting information
- The school/institution should depend on accounting information systems to make financial
- Efforts should be made to measure the effect of currently employed accounting concept on management decision
- School/Institution should always keep records of past events in case of future purpose; this can be possible with the use of computer or by fully automating the institutions
- A professional accountant should be employed by the school/institution in order to provide valuable information and keep accurate records of the institution’s
- Employees should be encouraged to develop themselves by becoming professionals in their chosen career; this will affect the institution to grow positively.
- Regular meeting with staff should be organized to disseminate information about the institution and also elicit feedback that helps to improve the institution.
- Lastly, Government should also encourage the use of accounting information to makes its financial decision and economic decision as well.
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