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THE ROLE OF COMPUTERIZED ACCOUNTING SYSTEMS ON
THE ORGANIZATIONAL PERFORMANCE. A CASE STUDY OF
(HORMUUD TELCOME SOMALIA).
BY
AHMED MIRE AHMED
BBA/20023/82/DF
A RESEARCH THESIS SUBMITTED TO SCHOOL
OF BUSINESS AND MANAGEMENT IN PARTIAL
FULFILMENT OF THE REQUIREMENT OF
THE DEGREE OF BACHELOR OF BUSINESS
ADMINSTRATION OF KAMPALA
INTERNATIONAL
UNIVERSITY
OCTOBER, 2011
- -- - --~ ..... - - -------------------------
DECLARATION I, AHMED MIRE AHMED do hereby declare that this research proposal presented is my
own work and it has never been presented to any academic institution for any academic
qualification.
All right reserved; no part of this proposal may be produced, stored in a data base or
retrieved system, or retransmitted in any fonn or by any means, electronic, mechanical,
photocopying, recording or otherwise without the prior written pennission from the
author.
Signature ... .......... ~ ................ . Date: .... 2..1./.f .. P. . ./ . ./.J .................. .
--=-..:.a -- ~~,.___- __ ....a:.....,____ - - ~~ ___,._,.__~---• ...____.._~--~~~~---~~~ -~.:¥-c.-cl-=~--.. ~---· -------------------------------------- -- - ------ - --- - --- - ---.
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DEDICATION
I would like to dedicate this research to my mother for their supporting me from the
primary up to now I have take the bachelor degree of Kampala International University.
I also would like to dedicate this research to my brother (Abdulahi Mire Ahmed) and
my sister (Halimo Mire Ahmed) for encourage & full support me for many y~ar~, cil1~
every person who supported me to accomplish this course successfully.
11
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APPROVAL
This is to confirm that thi s research work has been done by AHMED MIRE AHMED,
BBA/20023/82/DF, under my supervision and subseq uently approved by me.
Supervisor
~:n~~:E~ . Date ... ?.-:-~\.\(?\\\ .... .... .. ........ .
Ill
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ACKNOWLEDGEMENT
The successful completion of this dissertation would not have been possible without the
support, guidance and assistance of many people, amongst others, the following deserve
special mention:
I would therefore like to express l'ny gratitude to the people who made this possible. First
and foremost, to my supervisor, Mr. RUTEGANDA MICHAEL, for his support, patience
and guidance.
To my best friends Abdifitah Mohamud Hirei, who always believed in me and
encouraged me to do my best. He taught me courage, humor, integrity, and persistence.
To my mother, Madina Mohamud Qonjor, who showed me that strength is found in the
power of love and commitment. My brother ( Abdulahi Mire Ahmed) and sister
( Halima Mire Ahmed) , who have always been my best friends and my best sounding
board.
To My wife Maryan Mohamed Hussein, for his willingness in directing me to identify
most of the organizations where I could find the relevant literature on public relations.
Finally to the staff of Kampala International University especially in the depaitment of
accounting for pushing me to succeed and to persevere with my studies. And to everyone
who helped me to complete this opportunity, a sincere and heai1felt thank you.
IV
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ABSTRACT
Computerized accounting systems improve organizational efficiency and save time.
Therefore the researcher wants to investigate how the computerized accounting systems
affect the organizational performance.
The research discusses current literature showing that most businesses, except the very
smallest, now use computers to handle their accow1ting data. When businesses switch to
computerized accounting, they soon discover that book.keeping and accounting skills are
more important than computing ones. This is because users of many computerized
accounting systems have very little to learn in order to use them.
The study followed a case study design. A case study is a detailed examination of one
setting or a single subject, a single depository of documents or one particular event.
(Srass etal, 1990) as cited in Amin (2005). Case studies make an intensive investigation
on the complex factors that contribute to the individuality of a social unit. Quantitative
methods were used to capture data on outcomes, while qualitative methods were used to
grasp data on processes and reasons for the pa1iicular outcomes.
Recommendations
► Network essentials e.g. Network card, Network cables, Network connectors,
Coaxial cables, Router and very small ape1iure terminal (VSA T).
► New sofh\'.are for •the management of human resow-ces should be introduce4 in
order to enhance perfonmince (pi1macle software) .
► Provision of virtual private network (VPN) through which the Telecom industry
will collect and share the user name and password to their workers.
► Finally, users of this system should be given adequate training to cope with the
usage of the system.
V
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TABLE OF CONTENTS Declaration ............ ..................... .......... ..................................... ........................... ........ .i Dedication ................................. .. .......................................................... ... ................... ii Approval .................................... ........... .. ......... ..... ...... ........... ... ................. ...... ........... iii Acknowledgement .... .' ....................... ......... ................. ..... .... .................................... . , . .iv Abstract. ...... : ........................................................................................................... . : ... v Table of contents .............................................................................................. .......... vi Acron)'Ills ................................................. ...... ......... .... .................. .. ...... .. ..................... x List of tables ......................... ............... ................................................................ .... viii List of figures ............................................................................................................. .ix
CHAPTER ONE ... ...... ........ ....................... .................... ........ ......... ......... .................... 1 INTRODUCTION ........ ...... ... ...... ................................................... ......... .................... 1 1.0 Introduction ........................................................................................................... 1 1.1 Background of the study ..................... .. ........................................ .. ......... ............... 1 1.1.lBackground Hormuud Telecommunication Somalia (HTS) ............. .......... ........ 2 1.2 statement of the prob!em ............................................................................. .......... 3 l.3Purpose of the study ......................................................................................... ...... 3 1.4 specific objectives .................................................................................................. 3 1.5 research questions ...................................................... ........... ......... ....................... . 3 1.6 scope of the study ................................. ......................................... ........................ 4 1.6.1 Geographical scope .......... .................................. .. ...... .. ............... ........ ..... ........... 4 1.6.2 Tin1e Scope ......................... .................. ............ .. ................................................ 4 1. 7 Significance of the study ..... ........ .......................... ........ .... ................................... .4
CHAPTER TWO ..................................................... ........ .................. ...... ..... ............... 5 LITERATURE REVIE\\' ...................................................................................... ...... 5 2.0 conceptual fraineworks .......... .. ............................................. .. .. ........... .................. 5 2.1 Need and requirements of computerized accounting ............................................ 6 2.2Role of computerized %counting ........ ... .. .. ............................................................ 7 2.4Controls in manual and computerized accounting System ..................................... 9 2.5 Benefits of using a computerized accounting systems in an organization ............ 9 2.6 Types of computerized accounting system .. .. ...................................................... 11
CHAPTER THREE .......................................... ......... .... ..... .. ..................................... 12 METHODOLOGY ............................................. ..... ..... ...... ................................. ...... 12 3.0 Research design ........................ ................................................................. .......... 12 3. 1 Study Area ...................................................... .. ........ ........................................... 12 3.2 Study Population ...................................................... .................... ...................... .. 12 3.3 Sainpling Procedure ...................................................... ................................. ...... 12
Vl
3.4 Sample Frame work ........ ................................................................ ........ ............. 13 3.4.2 Sample selection ............................................................................................... 13 3.5 Srunple Size ..... ......................... ....... ................. ............ ............................... ...... .. 13 3.6 Source of Data .. ...... ... ................. ... ........... ..... ... .. ............ ....... .......... .................... 13 3.6.1 Primary source .. .................. ...... ........................................................................ 13 3.6.2. Secondary sources ....... .. ...... ....... .... ................. ..... .. ...... ...... .. ....... .................... 13 3.7 Methods of Data Collection ......................................................................... ........ 13 3. 7 .1 Questionnaires ... ................................ ................ ....................................... ........ 13 3.7.2 Interviews .... ......... ..... ..................... ......................... ................................... ...... 14 3.8 Data Control and Measurement.. .. .. ........... .. ......... ............................................... 14 3.8.1 Validity of the Research Instruments ... ... .... ......... ...... ...... ........................... .. ... 14 3.8.2 Reliability of the Instruments ............... ... ............. ..................... ......... ....... ... .... 14 3.9 Data Analysis ........... ........ ........................ ... .. .... ............................................. ...... 14
CHAPTER FOUR ... ........................................................... ................. .... .. ... ............. 16 4.0 Introduction ...... .......................................... ......................................................... 16 4.1 Data presentation and Analysis ..................................................... ...................... 16
CHAPTER FIVE .............. ....................... ......... ......................................................... 25 SUMMARY, CONCLUSION AND RECOMMENDATION ................................ :.25 5.0 Introduction .. ... ................................................................................... ........... .. ..... 25 5.1 Su1n1nary of findings ................................................... ........................................ 25
5.2 Conclusion ............... ............ ... ..... ....... ................................................................. 26 References ............. ............. .................................................... ................. .................. 28 Appendix I:_ General questions ............... ................................................................... 31 Appendix II:Proposed time frame/work plan ..... ......................... ... ............. .............. 34;
Appendix III:Proposed budget for proposal and report writing ··········· ······· ············:·35
Vil
LIST OF TABLES
Table 1: Percentage d_istr:bution ofrespondent's age .......................................... .. .... 16
Tabli 2: Percentage d~stribution of respondent's Gender .. ........ ................. ........ .... .. 17
Table 3: Percentage distribut-ion of respondents' civil status ............................... ..... 18
Table 4: Percentage distribution of respondents' Educational attainment .............. .. 19
Table5: Distribution of number of staff members in the organization .................... .. 20
Table 6: Benefits of using a computerized accounting system in an organization .... 22
Table 7: Need and requirements of computerized accounting devices ..................... 23
Vlll
LIST OF FIGURES
Figure 1: Percentage distribution of respondent's age .............................................. 17
Figure 2: Percentage distribution ofrespondent's Gender ........................................ 18
Figure 3: Percentage distribution ofrespondents' civil status ................................... 19
Figure 4: Percentage distribution ofrespondents' Educational attainment.. ...... ....... 20
Figures: Distribution of number of staff members in the organization .............. .. ..... 21
IX
HTS
TSP
IT
PR
CAS
VAT
TQM
HR
CV
MS
CEO
LAN
VSAT
VPN
ACRONYMS
Hormuud Telecommunication Somalia
Telecommunication Service Providers
Information Technology
Public Relations
Computerized Accounting Systems
Value Added Tax
Total Quality Management
Human Resource
Content Validity Index
Microsoft
Chief Executive Officer
Local Area Network
Very Small Aperture Tenninal
Virtual P1ivate Network
X
1.0 Introduction
CHAPTER ONE
INTRODUCTION
This chapter presents the background of the study, statement of the problem, purpose,
objectives, research questions, hypotheses, scope, and significance of the study and
operational definitions of key terms and the conceptual framework.
1.lBackground of the study
Most businesses, except the very smallest, now use computers to handle their ac~ounting
data. When businesses switch to compute1ized accounting, they soon discover that
bookkeeping and accounting skills are more important than computing ones. This is
because users of many computerized accounting systems have very little to learn in order
to use them.
The methods adopted in computer-based accounting adhere to the fundamental principles
of accour.ting covered in this and other accounting textbooks. No matter how
sophisticated and easy to use a computerized accounting system is, it will not overcome
the need for bookkeeping and accounting knowledge by those in control. Imagine, for
example, how anyone who does not know how to prepare journal entiies could correct an
error in an original entry correctly from an accounting point of view and, just as
importantly, understand why it is important not to erase the 01iginal entry.
Apart from a need for knowledge of accounting principles in order to best convert a
business from manual to compute-based accounting, some accounting knowledge is
required to help understand the significance of many of the outputs from a compute1ized
accounting system, just as it is required in respect of output form a manual accounting
system.
Thus computerized accounting systems do not remove the need for some accounting
knowledge among those responsible for key accounting tasks or from those who use the
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output from the accounting systems. In fact, some accountants working in practice would
tell you that they believe there is an even greater need for accounting knowledge among
those who record the transactions in a computerized accounting system than among those
using a manual one.
1.1.1 Background of Hormuud Telecommunication Somalia (HTS)
Hormuud is a p1ivately held enterprise established in April 2002 to cover the gap in the
telecommunication market in Somalia with its headquarters is in Mogadishu, Somalia.
More than 600 Somalia investors have shares in Hormuud Telecom. It's better known as
HORTEL and it's the leading Telecommunication Service Providers (TSP) in the
southern and central Somalia. Hormuud Telecom provides a variety of
Telecommunication service such as fixed line, GSM service, and Data services.
Hormuud employs more than 1700 fulltime staff with different specialties such as
Teleco1mnunication Engineering, Customer Services, Sales, Financial experts,
Production, Marketing, Quality Control Procurement, IT, PR, Stores, and the company
General Manager.
Since its formation, the company has enjoyed a very good reputation among the society
because of its social responsibilities, social welfare, excellence in customer care and its
uniqueness services.
Hormuud has received numerous awards in recognition of its grass-root work to
developing the local c01mnunity welfare including supporting educational institutions,
sanitary improvement and water supply.
HTS has achieved many quality awards in the country, and this is att1ibuted to the
company's never ending continuous improvements in quality processes and efficiency
and effectiveness of its employees.
2
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1.2 statement of the problem Computerized accounting systems improve organizational efficiency and saves time,
therefore the researcher wants to investigate how the computerized accounting systems
affects the organizational performance.
1.3Purpose of the study
The purpose of the study is to find out the role of computerized accounting systems in the
organizational performance.
1.4 specific objectives 1. To identify how computerized accounting systems are applied m the
organizational performance at HTS.
11. To identify the role of computerized accounting systems in the organizational
perfonnance at HTS Company.
111. To identify the role of computerized accounting systems on the orgar.izational
speed and accuracy of processing data at HTS Company.
1v. To identify the role of c0.mputerized accounting systems on error detection and
enhanced repo1ting at HTS Company.
1.5 research questions
1. How are computerized accow1ting systems applied m the organizational
perfonnance at HTS Company?
11. What is the role of computerized accounting systems 111 the organizational
performance at HTS.?
111. What is the role of computerized accounting systems on the organizational speed
and accuracy of processing data at HTS Company?
1v. What is the role of compute1ized accounting systems on error detection and
enhanced reporting at HTS Company?
3
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1.6 scope of the study
1.6.1 Geographical scope The study was carried out at the headquarter in Mogadishu where HTS is located.
Selection of HTS was as a result of the fact that as far as maintaining and enhancement of
standards geared towards delive1ing of quality service is concerned it's still challenging
other telecommunications companies.
1.6.2 Time Scope The research was carried out in the period between January 1,2011 till October 31,2011.
1.7 Significance of the study
The study intended to benefit different organizations m knowing how to use
computerized accounting systems, in a bid to produce quality goods and services.
This research will also help policy makers to identify the real challenges that exist in
telecommunication companies, and this helps in setting a real policy to overcome
challenges facing finance department.
The academic generation would also benefit from the study, in terms of literature review
in mate.rs of computerized accounting systems.
4
2.0 conceptual frameworks
Independent variable
The role of computerized accounting systems.
1- Prepare summary of transactions and financial statements manually
2-Advanced technology 3-Accounting
records become
more
Convenient.
I ...
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CHAPTER TWO
LITERATURE REVIEW
• Time • Culture • Communication • leadership
Dependent variable
Organizational performance
Performance of CAS 1. Reduce effort 2. Save time 3. Improve efficiency 4. Reduce errors Benefits of CAS in finance dep. • Timesaving • Increased
speed and accuracy
• Less staff required
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5
2.1 Need and requirements of computerized accounting
The need for computerized accounting arises from advantages of speed, accuracy and
lower cost of handling the business transactions.
Numerous Transactions:
The computerized accounting system is capable of handling large number of transactions
with speed and accuracy Doost, R. K. (1990),
Instant Reporting:
According to Abu-Musa, A. A. (2001), the computerized accounting system is capable
of offering quick and quality reporting because of its speed and accuracy.
Reduction in paper work:
A manual accounting system requires large physical storage space to keep accounting
records/books and vouchers/ documents. The requirement of stationery and books of
accounts along with vouchers and documents is directly dependent on the volume of
transactions beyond a certain point. There is a dire need to reduce the paper work and
dispense with large volumes of books of accounts. This can be achieved by introducing
computerized accounting system Qureshi, A. A. and J. G. Siegel (1997),
Flexible reporting:
The reporting is flexible in computerized accounting system as compared to manual
accounting system. The repo1is of a manual accounting system reveal balances of
accounts on periodic basis while computerized accounting system is capabl~ of
generating reports of any balance as when required and for any duration which is within
the accounting period.
On-line facility:
Carnevale, W. (2003), Computerized Accounting System offers online facility to store
and Process transaction d~ta so as to retrieve infonnation to generate and view financia~
reports. ·
6
Accounting Queries:
There are accounting queries which are based on some external parameters.
Accuracy:
Doost, R. K. (1990), the information content of reports generated by the compute,rized
accounting system is accurate and therefore quite reliable for decision making. I.n a
manual accounting system the reports and information are likely to be distorted,
inaccurate and therefore cannot be relied upon. It is so because it is being processed by
many people, especially when the number of transactions to be processed to produce such
infonnation and report is quite large.
2.2Role of computerized accounting Abu-Musa, A. A. (2001), the most popular system of recording of accounting
transactions is manual which requires maintaining books of accounts such as Journal,
Cash Book, Special purpose books, and ledger and so on. Qureshi, A. A. and J. G. Siegel
(1997), The accountant is required to prepare summary of transactions and financial
statements manually. The advanced technology involves various machines capable of
performing different accounting functions, for example, a billing machine. This machine
is capable of computing discount, adding net total and posting the requisite data to the
relevant accounts. With substantial increase in the number of transactions, a machine was
developed which could store and process accounting data in no time. Such advancement
leads to number of growing successful organizations. A newer version of machine is
evolved with increased speed, storage, and processing capacity. A computer to which
they were connected operated these machines.
As a result, the maintenance of accounting data on a real-time basis became almost
essential. Now maintaining accounting records become more convenient with the
computerized accounting.
Davis, C. E. (1997), the computerized accounting uses the concept of databases. For this
purpose an accounting software is used to implement a computerized accounting system.
It does away the necessity to create and maintain journals, ledgers, etc., which are
7
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essential part of manual accounting. Some of the commonly used accounting softwares
are Tally, Cash Manager, Best Books, etc.
Accounting software is used to implement a computerized accounting. Qureshi, A. A. and
J. G. Siegel (1997), The Computerized accounting is based on the concept of database. It
is basic software which allows access to the data contained in the data base. It is a system
to manage collection of data insuring at the same time that it remains reliable and
confidential.
2.3 Computerized accounting system cycle
Steps in accounting cycle Manual systems Computerized system
• Analyze source Manual System Manual
documents
• Record transactions Manual Manual
in journal
• Post to Ledger Manual Automatic
accounts
• Prepare Unadjusted Manual Automatic
Trial Balance
• Journalize adjusting Manual Manual
entries
• Post adjusting Manual Automatic
entries
• Prepare adjusted Manual Automatic
Trial Balance
• Journalize closing Manual Automatic
entries
• Post closing entries Manual Automatic
• Prepare post-closing Manual Automatic
Trial Balance
• Prepare financial Manual Automatic
statements
8
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2.4Controls in manual and computerized accounting System
Katz, D. (2000), Independent reconciliation of external data like using bank statement to
reconcile to the company's bank account or using external supplier statement of account
to reconcile with our individual creditor account;
. Using Control or Total Account
Review of the Trial Balance to ensure debit= credit.
m the other hand Schweitzer, J. A. (1987); Proper transaction authorization, Input
control needs to be instituted like input data needs to be verified for accuracy anq
completeness by a person-different from the one who is keying in the data;
. Besides the above input control, there should be processing and output controls to ensure
integrity of the transaction data is intact;
. No unauthorized access to computer files, data, etc. Grundy, E., Collier, P. and S., Barry
(1994), All kept under lock and key and proper log is maintain; Uses of password control
to access data;
2.5 Benefits of using a computerized accounting systems in an organization
Speed and accuracy:
The main aim of computerizing an accounting system is to perform the processing stage
electronically, much more quickly, consistently and accurately than if it were done
manually. However, transactions and amendment details have to be input into the
process.
1- in the correct fonn
2- in the correct order
3- In a timely maimer.
Although there is scope to use electronic methods of entering some of this information, it
requires a good deal of initiative and an organized way of doing things in order to do so.
Nevertheless, improved accuracy is one of the more obvious benefits of ai1y kind of
computerized accounting system.
Further time-saving cai1 be achieved by immediate output of reports, such as customer
statement, purchase analysis, cash and bank statements, and details about whether the
9
business is meeting sales targets. Such reports and statements can be produced both on
request and, automatically, by the computer searching through information generated and
saved within the accounting system and then producing whatever report is required.
Error detection:
Levi, P. (1993), Effective en-or detection improves the decision-making process. For
example, a computerized accounting system should be capable of detecting when a
customer appears to be runmng up excessive debts with the business, so offering the
chance for the credit controller to take remedial action.
Another area is the need to remain within budgets. Meal!, Lesley (1992), many business
expenses can get out of hand if they are not checked at regular intervals. A computerized
accounting system should be capable of an activity called exception reporting, a process
of issuing a warning message to decision-makers when something unexpected is
happening is happening: for example, when expenditure against a budget is higher than it
should be. In a manual accounting system, the situation can occur that errors or unwanted
transactions go unnoticed until it is too late, resulting in unnecessary costs being incurred
by the business.
Enhanced reporting:
For many business, the task of producing reports on a regular basis, such as VAT
Returns, payroll processing, cash flow analysis, and financial statements, can be time
consuming, tedious and unrewarding. The use of a computerized accounting system
speed up the process to the point, in some cases, where it is done automatically thus
reducing the monotony of producing lengthy reports requiring extensive preparatory
analysis of data. Grundy, -E., Collier, P. and S., Barry (1994), In many cases, such as
VAT Returns and pay slips, bu?inesses find that they can use computer printouts o-r
electronic output, e.g. on computer disks, instead of having to manually complete official
or standard fonns.
10
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Staff Motivation:
Coffin, R. G. and C. Patilis (2001), a computerized accounting system often requires' the
staff to undergo training to learn new skills, making them feel motivated. Further, the
employer can outsource training to a representative from the software company, creating
less pressure on staff members to administer the training themselves.
2.6 Types of computerized a~counting system Several d~fferent types of computerized accounting systems are available in the software
market. Companies can choose J.ow-price standard software or have a special systern
custom-made for a higher price.
Networking:
Computerized accounting software can be networking using th'e Internet, allowing a
single accounting office to perform accounting functions for several locations. Some
companies outsource accounting functions globally using their accounting software
Schweitzer, J. A. (1987).
Functions:
Coffin, R. G. and C. Patilis (2001), Accounting software has the ability to complete a vast
array of functions, including general ledger, fixed assets, payroll and reconciliation tasks.
Most functions calculate and present data electronically, allowing accountants the ability
to review and correct the information as needed.
Storage:
Most companies utilize electronic storage options when implementing computerized
accounting systems. Using data servers or other electronic storage limits the amount of
paper a company needs to physically store in their files.
Careers:
Grundy, E., Collier, P. and S., Barry (1994), Many new career options are available in the
computerized accow1ting field. Database administrators, network managers and technical
consultants are all valuable positions for maintaining a computerized accounting sys
11
- -- -- - --
3.0 Research design
CHAPTER THREE
METHODOLOGY
----- --- - - -
The study followed a case study design. A case study is a detailed examination of one
setting or a single subject, a single depository of documents or one particular event.
(Srass etal, 1990) as cited in Amin (2005). Case studies make an intensive investigation
on the complex factors that contribute to the individuality of a social unit. Quantitative
methods were used to capture data on outcomes, while qualitative methods were used to
grasp data on processes and reasons for the particular outcomes.
3.1 Study Area The research study was conducted at the headquarters of HTS in Mogadishu Bkara
Branch. It chosen because it is the one of the leading telecommunication companies in
the country and uses computerized accounting systems, more over HTS haves the biggest
market share in the market as compared to its competitors.
3.2 Study Population The study population was employed in the finance department (the key informants),
employees from other department: finance, production, marketing sales, quality, con.trol
procurement, IT, Stores, PR, Engineering, and the company General manager. Choice of
employees from other depai1ments complement on HRD carries out TQM when
performing its tasks, as they ai·e the department' s internal customers.
3.3 Sampling Procedure Purposive sampling (the ·researcher used judgment regai·ding paiticipai1ts from whoni
infonnation was collected) was used in identifying pai1icipants/ respondents from e-acl_1
depai1ment. Purposive sainpling helped the researcher select the sample based on her
experience of knowledge of the group that was a sainple.
Selection of respondents sta11ed with acquiring a list of all the depai1ments, and
administrative staff (employees) in the compai1y. This was done with the help of the
training personnel in the HR depai1ment.
12
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3.4 Sample Frame work The sample drew from the finance department, and the different department within the
company. Respondents included store sales department / cashier departments, followed
by leader of the coordinators/officials, and another respondent out of the three
coordinators.
3.4.2 Sample selection Selection of respondents was based on employees hierarchical in the department, and
basing on the researcher's experience on the level of knowledge of a particular
respondent.
3.5 Sample Size A sample size of 55 respondents was used.
3.6 Source of Data
3.6.1 Primary source This involved raw data which the researcher obtained a letter from the field, through
interviewing respondent's use of questio1maires, and observations.
3.6.2. Secondary sources This involved literature obtained from published materials like journals, text books, and
articles from the internet on previous similar studies. This source was used because of its
availability, and it being in existence already.
3.7 Methods of Data Collection The instruments used by this research were
3.7.1 Questionnaires This refers to the collection of items to which the respondent is required to fill in the
questions asked by the researcher. The questionnaires were including close ended
questions and open ended question aimed at getting all necessary data from respondents.
The researcher believes these data collection methods or techniques enabled him to
successfully collect reliable data and that is the reason behind why they were optioned.
13
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3.7.2 Interviews
The purposes of these interviews were to get the idea of management staff so that would
help the researcher to come out with report. The researcher used interviews to acquire
information that was not easily obtained through questionnaires. Interviews were used
because it save time when the interview schedules are structured and you get the first
hand information from the respondents and it enabled the researcher to probe more for
clarification.
3.8 Data Control and Measurement
3.8.1 Validity of the Research Instruments To measure the validity of the research instrument, the researcher used the Content
Validity Index (CVI) approac;h. The researcher circulated the research instruments to
three judges to assess every item in the instrument as valid (v). Then the inter judge
coefficient of validity was calculated as:
Inter judge coefficient= number of judges declared item valid Total number of Judges
Amin (2005) confirms that the process is repeated for all the items in the instrume.nts.
Then the average of number of items valid is calculated to get CVI, according to amin
(2005), if the CVI is fonn 0,70 above it is accepted.
3.8.2 Reliability of the Instruments Reliability of both staff management and client's instrument was established through a
test-retest _method. The researcher conducted a pretest for the two questionnaires in HTS
Bakaro branch. And retest was conducted after two weeks in the same branch to the sa.m~
respondents and if give the same result. This showed the consistency in the reliability.
Therefore the instruments were valid.
3.9 Data Analysis Data collected was sorted out for meaningful analysis, according to the different
departments and checked for completeness. Answers from the key informants were
grouped separately. Questionnaires codes were used and entered in the computer using
Ms excel.
14
The researcher used tables and graphs to establish the role of computerized accounting
systems in the organizational perfonnance of the finance department. This package was
used because of its ability to save time, and the ability to handle a diverse number of
variables.-Direct quotations from respondents were also used.
15
CHAPTER FOUR
PRESENTATION, INTERPRETATION AND ANALYSIS OF DAT.tL
4.0 Introduction This chapter presents a summary of the results of the empirical nature of the research.
The empirical data collected during the study was subjected to statistical analysis. The
chapter starts by providing the response rate of the study, and then followed by the
population sample, a summary of all results of the questions included in the questionnaire
follows. The chapter will c_onclude by sununarizing the main findings.
4.1 Data presentation and Anal~1sis Is a part of the technical process in the statistical of data? The essential operation in the in
the tabulation is counting to detennine the number of cases that fall into the various
categories.
Table 1: Percentage distribution of respondent's age
Age Frequency Percentage
18-24 6 7
25-31 7 ! 26
32-38 4 31
39-45 3 16
46-52 8 12
52 and Above 5 8
Total 33 100
Source: Primary
16
--- -- - -- -- - -
Figure 1: Percentage distribution ofrespondent"'s age
357'
30S
-~ • -2°" --C 3 ~ ... • a:. 1°"
5"
°" 18-24 32-38 46-52 52 above
The figure shows that majority of the respondents were aged around 32 to 3&. They were
31 % of the total number of the respondents. A big part of the respondents were aged 25
to J.:L years okt. Hley w~r~ io¾ <rt the total rmmber ol responcterns. ~ome o1 the
respondents are 39 to 45 years old. They were 16% of the total number of respondents.
l'here was a small group of respondents aged 45 to 52. 'lbey were 12% of the total
number of respondents. Moreover another small group of respondents were aged 52 and
above. ·1 ms grou_µ at. respander1ts was 8% of the total rrumb'er at respondents. ·1 he
smallest group of respondents was 18 to 24 years old. They were 7% of the total number
of respondents. it shows that majority of the respondents are weH experienced to give
answers to the questions thus giving the information needed for the research.
Tabte 2:- Percentage distributitm of respondent's- Gender
Gender Frequency Percentage
Female 7 52
Male 6 48
Total 13 too
Source; Primary
11
-- - - - - - --- - - - - - - - -
Y.Jglltt 2: Percentage distribution of .respmulent7s Gender
53'1.
53
5lS .. • --- SIS C
! 49% :!
48S
47%
46'&
Male
6enda
Most staffs were female (52%). lbe profile in terms of gender, where the profession is
flooded with males, according to the researcher' s knowledge. The assumption was
proved w be mt:m1c~t. 1l afsu u1eall:'.> H1at Lfic; pch::evw:m w tile: study will znn tJ~ tna.sed
but instead it will be based on both gender's point of view.
Table 3: Percentage distribution-Of resp&adents' aril smtu.s C-rvil Status Frequency Percentage
Mauied 6 48
Divmced 7 32
Single 4 9
Total 17 •• Source: Primmy
I8
Figure 3: Percentage distribution of respondents' civil status
ws
sos
- 4B • --- ~ C: u ... • a.
21&
ms
°" Married Single
In this figure majority of the respondents were married. They were 4i% of the total
number of respondents. 32% of the respondents were divorced. 11 & of the respondents
were widowers. Lastly 9% the respanctents was single. Most ot the respondertts are
married and had gained a lot of maturity and experience. In getting the necessary
information it is important to ask persons who are more maturity to prevent being
misled.
1'able- 4:· Percentage dismbuooa &f ns.pondents' Educational attainment
Level of Education Frequency Percentage
College~ 7 55
Post College Degree 5 45
Total n 100,
Sollttt!: Primary
19
-- - - - - - - - - -- - - - -
Figure 4: Percentage distribution of respondents' Educational attainment
~
Coffege Degree Post College Degree
In this figure ~~% ot tite respondetits lm.ished a cottege degr~. "lhe other respcm.dents or
45% of the group had a post college degree. The educational attainment helps in the
scope of knowledge and experience the respondents has. It also helps ·in adju5ting to the
level of thinking the respondent has. The respondents being in college makes sure that
they have a certain level of thinking that can be of great help in the research.
TableS: Distribution of DUmber of staff-members in 1dle organization
Department Frequency P.eroentage
Public Relations 5 21%
Assoriati-111 3 13%
CEO 4 11%
Madreting ms~ I 33%
General manager 2 .1%
Others 2 ll%
1'et.al 24 118
Source: primary data
2t)
- - -- - - - - . - - - - - - . - -~ - - - - - - ------------- - --- - - - - --~---- ---------- - ---
Figure5: Distribution of number of staff members in the organization
■ Public Relations
• Association
■cm
■ Marketing manager
■ General manager
■ Others
kespmt<lertts were farther asked to indicate to whom they reported to dfrectfy in the
organization. The data indicated that most public relations function reported to the
marketing manager (333/o). "lbirty percent report directly to the Chief Executive Officer,
13% to the general manager and four percent report either to the human resource manager
or the social responsibility officer.
According to Steyn and .t'uth C~OO(}J, rt rs mast urllctir that the corporate conutmnication
function should be reporting to another functional area, such as human resources or
m~tk~ting t~ttyn & ruth, l\100: / ). 1 h~~ i'l>".:>"Ucs and t:onoons htt1'aiiy btg the \1Ue-.5titm:
Why is it that corporate communication function seems so singularly unsuccessful in
their attempts tiJ gain recogairion and access to the strategic level of the organization?
The question becomes even more perplexing when recent research clearly indicates that
virtually nobody at top management level, least of all the CEO, disputes the necessity and
importance of communication to the organization.
In order to get a clear understandirrg of the nature of public relations in the country. The
respondents were asked whether they are members of any professional public relations
body or association. Seventy two percent of the respondents were not part of any body
21
and a telephonic interview of 10% of the above indicated that they did not know any such
body. Others were not interested in paying subscriptions for such an organization.
Twenty nine percent of the respondents were part of the association, and through a
telephonic interview with some, they indicated that subscription was paid by the
organizations they are working for. Another percentage indicated that there are a lot of
opportunities they gain by being members to such a body, though they failed to declare
what kind of opportunities they enjoyed.
4.2 Results
Table 6: Benefits of using a computerized accounting system in an organization
Strongly Agree Neutral Disagree Strongly Agree Disagree
Speed and accuracy: 11 % 21% 12% 24% 31%
Error detection: 12% 20% 12% 24% 32%
Enhanced reporting: 14% 23% 10% 23% 30%
Staff Motivation: 12% 21% 9% 30% 31%
Table 6 shows that the adoption of most of the computerized Accow1ting system products
in the studied banks took place within the last five years. Smart Cards and Telephone
Banking were not available between 1990 and 1996 in any of the studied banks. Only one
bank claimed to have Electronic Home and Office Telecommunication within the same
period. However striking exceptions were noticeable in the adoption of the MICR and
LAN technologies where 111ost of the banks had adopted the use before 1998. The reason . .
for the early adoption of MICR technology was due to the mandatory stand of the Ape:x
Telecom industry (CBN) on a phased implementation of automation of cleruing house
scheduled to take place between 1990 and 1993. Since MICR cheques were central to the
implementation of this policy most banks were fo rced to adopt its use. Early adoption of
22
Local Area Network in the early 1990's was influenced by the advent of Micro
Computers in the fourth generation which made connectivity feasible.
Table 7: Need and requirements of computerized accounting devices
N Mean Std. Minimum Maximum Deviation
Adoption of computerized accounting 140 4.34 75 1 5
devices in enhances Numerous transactions
Adoption of computerized accounting 139 4.13 85 1 'S
devices in enhances Instant Reporting:
Adoption of computerized accounting 140 4.10 82 1 5
devices in enhances Reduction in paper
work:
Adoption of computerized accounting 134 4.26 91 1 5
devices in enhances Flexible reporting:
Adoption of computerized accounting 135 3.76 1.24 1 5
devices in enhances On-line facility
Adoption of computerized accounting 136 3.46 1.23 1 5
devices in enhances Accounting Queries
Adoption of computerized accounting 139 4.19 78 1 5
devices in enhances Accuracy: Source: Research Survey, 2004.
Findings need and requirements of computerized accounting devices has influenced the
content and quality of accounting operations. From all indications, computerized
accounting systems present great potential for business process reengineering of
Somalia's industries. Investment in information and communication technology should
fonn an impo11ant component in the overall strategy of accounting operators to ensure
effective perfonnance. It is imperative for bank management to intensify investment in
computerized accounting system products to facilitate speed, convenience, and accurate
services, or otherwise lose out to their competitors. The Telecom indust1y in Somalia
23
-
-- - - - - - •- - . - - . --_ ---~- - ___ ____. _____ ~.• ------ ---------------- --- - -~ - - -----------
presents computerized accounting providers with great opportunity to market their
innovations. Success in this area however depends on how they can customize their
services to appeal to the ready minds of various stake holders in the industry.
24
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
5.0 Introduction This chapter is dedicated to the summarization of the results presented in the previous
chapter, as well as the conclusions that can be derived from the gathered and collected
data. Recommendations for actions as well as further studies are also included in this
chapter.
5.1 Summary of findings Computerized System Accounting has been with us for a long time, may be as the history
of man himself. Then pencil and the clerk dominated the period around 1955. By today
standard, data processing was very rudimentary for most organizations because it was
limited to only accounting system, payrolls etc to operate business for example, order
processing and invoicing but computer come along with changes. We are now moving to
a time where access to the information can be made nationwide upon "online real time
wide area network "through our knowledge modern computers and communication
method have opened up new information technologies. Computer has immensely aided in
Telecom industry in the areas of managerial position, sales department and other various
department in the Telecom industry. The use of programmed decision making offers
several important advantages to the firm, since the computer is potentially capable of
making better programmed decision than the human user. One of the most existing things
about the infonnation and retrieving is that they are used oriented. In other word the ideal
of implementing a new computer based system result in satisfying the need of the
operation and help to managers for decision making which have never been possible by
the former manual and electro-mechanical methods to complete the function effectively
since many business and customers are falling to the bank, for effective perfonnance of
this duty it needs an effective automated systems.
25
5.2 Conclusion Computer wizards of today' s business have a greater role to play on business oriented
organizations and especially in Telecom system. The research has critically examined
then influence of computers on modem Telecom systems in Hormuud Telecom Somalia.
The finding of this research has shown that computer has greatly influence the Telecom
industry and still reveling that there is a lot of room for new expansions and improvement
as the technology advances, the influences involve positive excellent of services delivery
e.g. taking decision promptly and immediately, easy depositing of funds in one branch
and retrieve it at another branch location instantly. Furthennore, internet
Teleco1mnunication is another concept of delivering services to customers globally
promptly as the client needs. Expansion does not mean having more braches but
providing higher quality services. Conclusively, computer helps to speed up internal
response and increase efficiency, ascertain actual stock position.
5.3 Recommendations
Telecom without visiting the bank is now technically possible as it was stated in the
conclusion. As the technology advancing, the industries should be re-engineedng their
systems infonn of automating the services as well as updating the machinery .and
equipment like electronic Telecom. Base on the finding of during this research study, the
following are the researcher's recommendation of which if the management of the firm
adopt would bring about more improvement in their operations.
The reconunendations are a~ follows, new hardware and software will be required
because it is what the case study of this research is using presently, and the equipment-_is: .
► Mainframe and Microcomputers with other peripherals.
► Network essentials e.g. Network card, Network cables, Network connectors,
Coaxial cables, Router and very small aperture tenninal (VSAT).
26
► New software for the management of human resources should be introduced in
order to enhance performance (pinnacle software).
► Provision of virtual private network (VPN) through which the Telecom industry
will collect and sha:re the user name and password to their workers.
► Finally, users of this system should be given adequate training to cope with the
usage of the system.
27
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30
Appendix I
GENERAL QUESTIONS
1. Gender
Male D 2. Marital status
Single
Married
Separated
Female
D
D
Other specify D
3. Age of the respondents
20-25 D
26-30 D
31-35 D
36-40 D 41-50 D 50 D
D
4. Highest level of qualification (Please tick one)
Less than bachelor
Bachelor
Graduate
D D D
Any other specify ..... . ............. . . .................................................. .
5. Relation to Head of household
Head
Spouse
Accountant
D D D D
Any other specify .. . .............. . ............................................. .
31
6. How efficient/speedy do you think your services is with the use of computerized
accounting wide area network?
a) Highly Efficient D b) Efficient D c) In efficient D
7. Has the use of computer curtailed the long time spent on queue by customers m the
Telecom industry?
Yes D No D
8. How can you rate the Telecom operation after the introduction of computer?
a) Highly D b) No improvement D c) Inefficient D
9. Is the Automated System worth having?
Yes D No D
10. Is your "Online real time wide area network" available to both current holder?
Yes D No D
11. How can you rate fraud occurrence with the use of computers compared to manual
operations.
a) Highly efficient D b) Efficient D c) No Difference D
12. Do you think fraud is reduced by implementing computers to Telecom operation?
a) Highly D
32
b) No improvement D c) Inefficient D
13. How can you rate the Telecom operation after introduction of computer?
a) Highly D b) No improvement D c) Inefficient D
14. How can you rate fraud occun-ence with the use of computers compared to manunal
operation.
a) Highly D b) No improvement D c) Inefficient D
15. Do you think fraud is reduced by implementing computers to telecom operation?
a) Highly D b) No improvement D c) Inefficient D
Thank you
33
1
2
4
5
Item
Personal stipends Research Assistants Researcher Research training Subtotal
Appendix II
Proposed time frame/work plan
Quantity Unit cost
2 100,000 1 40,000
50,000
Researcher }sistence
1 10,000 Research 2 5,000 Assistants
Subtotal Stationary 5 reams 10,000 Secretarial and print 50,000 Flash disk l (2GB) 20,000 Pens l box 15,000 Subtotals Report writing Data analysis Editing Binding 5 copies 8,000 Dissemination 1 100,000 (workshop) 5% of total Contingency Subtotal Grand total
34
Details Total cost (u shs)
2 X 100,000 100,000 1 X 40,000 40,000
50,000 190.000
1 x 10,000 10,000 2 X 5000 10,000
20,000 5 X 10,000 50,000 50,000 50,000 1 X 20,000 20,000 1 X 15,000 15,000
135000_ 30,000/= · 20,000/= 20,000/=
8000 X 5 40,000/= l x l 00,000 100,000/=
210.000 305,000/=
Appendix III
Proposed budget for proposal and report writing
:::TIVITY
oposal writing of approval
ep."ration, approval of
;truments, and piloting (pre
;ting)
:eking pennission for access to
1dy sites
aining of research Assistance
.d interpreter
eld data collection
ata cleaning and organization
ata analysis and interpretation
'1iting of final report and
1bmission
issemination workshop (research
1dings)
MONTHS
Jul Aug Sept Oct
35
