The research topic of this study is “The Effect of Computerized Accounting System on the Performance of in Banking Industry – a study of selected banks in Enugu Metropolis. The purpose is to know whether the application of Computerized Accounting System superceeds that of manual Accounting System, and that if computerized Accounting System enhance higher turnover and profitability, and also whether a computerized accounting system is an effective means of keeping accounting records. The study population is 70 persons who are the members of the staff of the three major selected banks. Using the Taro Yamene’s formula the sample size calculated gave (60). The formulated hypothesis were tested using the analysis of variance (ANOVA) statistical technique at 5% level of significance. The researcher also made use of primary methods of data collection which included questionnaire and personal interview. Also the secondary method of data collection used was gotten from official documents of the banks, various research work on computerized accounting system, accounting journals, textbooks and Caritas University Amorji – Nike, Emene, Enugu State library. Based on these, the researcher recommended that banks in Enugu Metropolis should channel most of their resources in the training and development of bankers and Accountants personnel in computerized accounting system related technology such as I.C.T to boost performance in their banking operations and their personnel. Also due to the widespread of computer trends and its dynamics nature, it is recommended that banks in Enugu metropolis who are still battling with manual system should adopt specifically the Computerized Accounting System.


Approval Page i

Dedication ii

Acknowledgements iii

Abstract iv



Background of the Study1

Statement of the Problem4

Objective of the Study4

Research Questions5

Hypotheses of the Study6

Significance of the Study7

Scope and Limitation of the Study8

Definition of Terms9



Conceptual Framework10

What is Accounting System?15

Methods for Computerization in Accounting17

Types and Principles of Computerized Accounting System20

What Is computer and Computer Trends26

Types and Why We Use Computer System28

Accounting Packages.37

Application of Computer in Accounting System29

Merits and Demerits of Computerized Accounting System and its Differences

with Manual Accounting System 41

Problems and Control of Computerized Accounting System49

The Effect of Computerized Accounting System on the performance of Banking Industry in Nigeria47

A Brief History Origin of Banking under study 49



Research Design52

Sources of Data53

Research Instrument55

Reliability/Validity of Research Instrument55

Population of the Study56

Sample Size/Technique57

Administration of Research Instrument61

Method of Data Analysis61

Decision Criterion for Validation of Hypothesis62



Presentation of Data63

Testing of Hypotheses80



Summary of Findings93



Bibliography 100

Appendix I -Request for Supply of Information 102

Appendix II - Questionnaire 103


TABLE 4.1.0 - To what extent is the operations of your

bank computerized. 70

TABLE 4.1.1 - Does your bank have a specific computer

(Data base) department/ section unit? 71

TABLE 4.1.2 - Does computerization aid quick customer

service decision making process

and accountability in your bank? 72

TABLE 4.1.3 - Computerized accounting system is an

effective means of keeping proper accounting records. 73

Table 4.1.4 - Computerized Accounting system help to

gain inherent advantage while minimizing risks involved in the daily banking operations 74

Table 4.1.5 - There is a relationship between the application

of the computer and manual system in the accounting system of the baking

industry. 75

TABLE 4.1.6 - The effect of computerized accounting

system enhances higher turnover

and profitability in banks. 76

TABLE 4.1.7- There is co-ordination and quality performance

in banking operations through the use of

computerized accounting system.


TABLE 4.1.8-There is an effect of using computer to keep accounting records.


Table 4.1.9 -

Computerized accounting system aids

in the examination of banks statements of

financial position to ensure agreement with source documents.




Today’s modern technology brought into use the computer, this technology is the application of science to gathering, recording, processing and communicating of business information by means of electronic media. Most commonest tool for application is the computer and it involves all the transaction processing system management information system various business support system etc. The computer is a central force in the advancement of various organization. The historical development of computer started with Hollerith punched card of 1880,Goerge Alken calculator and Charles Babbage’ creation of the difference engine.

The computer can be defined as a tool or device which is able to accept facts (data) and figure in a prescribed form, apply prescribed processes to data and supply result of the processes in a specified format as a meaningful information. There are also different types of information depending on the make or type of

their functions. The revolution in technology to the computer complements or in the other hand, substitute for ten elements which are: - paper, personal memos, charts, reports, calculators, terminals letter.

Hartzell (2006) defines computer as an electronic machine for processing information automatically and very quickly. The important of computers is the ability to handle vast amount of information and to do other processes with accuracy and speed which cannot be manually undertaken have been recognized and appreciated by financial institutions, hence the trend in the computerized of banking operations.

Tanembaum (2010) sees computer as a machine that can solve problems for people by carrying out instructions given to it.

The American Accounting Association defines accounting as the process of identifying, measuring and communicating economic information to permit informed judgement and decision by users of the information. Accounting is also the establishment, maintenance, collection and analysis of financial position of an

organization and any changes that have occurred or may occur overtime.

Omolehinwe (2009) defines accounting as the collection and recording of financial data about an organization whether in the private or in the public sector and analyzing the data so collected to suit the decision that needs to be taken and reporting the relevant information in a summary form to the user in a form that is meaningful to him or her.

Chionye (2003) defines accounting system as the art of identifying, recording, classifying measuring and interpreting in a significant manner the financial transaction of an organization for decision making. Summarizing from time to time the information contained in the record, for its significant presentation and interpretation to interested parties as an aid to decision making.

Accounting system is also defined as a consistent way of organizing, recording, summarizing and reporting financial transactions.

Computerization is the installation of computers as a part of a process of automation.

Banking in Nigeria has witness impressive development in recent time particularly within the last decade in time with growth in economic activities and complexities, banking service have expanded significantly in size and variety due to increased by computerization of banks.


In spite of the benefit of computer to banking industry and business generally some problem are still left unsolved and new ones have been credited by the use of computer itself problems like;

The use of computer to keep accounting records.

Another problem is the displacement of labour hands in the accounting department and its union implication and the problem of low turnover (volume of operation) and profitability in banks.


The objectives of this study are:-

⦁ To determine he relationship between the application of the manual accounting system and the computerized accounting system in the banking system.

⦁ To find out, whether the effect of computerized accounting system enhances higher turnover (volume of operation) and profitability in banks.

⦁ To examine the impact of using computer to keep accounting records.


To be able to achieve the above purposes, some questions would be asked which help the researcher to gather the necessary information needed, they are:

⦁ Are there any relationship between the manual accounting system and the computerised accounting system in the banking industry?

⦁ Also can computerized accounting system enhance high turnover and profitability in banks?

⦁ Finally, What are the effects of using computers to keep accounting records?


In order to ensure the verification and validation of the primary data gathered through administration of questionnaires. A research hypothesis is formed comprising the null hypothesis (Ho) and the alternative hypothesis (Hi).

Hypothesis One

Ho: - There is no relationship between the application of the

Computer and manual system in the accounting system of banking industry

Hi: - There is a relationship between the application of the

Computer and manual system in the accounting system of the banking industry.

Hypothesis Two

Ho:- The impact of computerized accounting system does not enhance higher turnover and profitability in banks.

Hi:- The impact of computerized accounting system enhances higher turnover and profitability in banks.

Hypothesis Three

Ho:- There is no effect of using computer to keep accounting records.

Hi:- There is an effect of using computer to keep accounting records.


Most banks have growth and continuity as part of their objective, and such objectives are best realized by an efficient management, as well as effective computerized accounting system. This has made it possible for banks to gain inherent advantage while minimizing risks involved in their daily operations.

This research project will therefore be of immense advantage or benefit to the management of banks, computers and other business organization using computerized accounting system. Hence, the theories and concept contained therein can be infused into their management system.

This research will also contribute to enhance efficiency in the following ways;

a) Speedy and accurate decision making through the use of computerized accounting system.

b) Improvement in the delivery and quality service.

c) The banks profitability will be improve.

Firstly, in the realm of academic, the project will be very useful to wide audience as it applies to courses in accountancy, banking and finance as well as executive development courses, management seminars and supervisory workshop conducted in colleges and universities.


The scope of the study is restricted to examining the effect of computerized accounting system on the performance of banking industries such as, Diamond bank plc, Eco bank plc and First bank plc all in Enugu metropolics of Enugu state.


AUDIT TRIAL:- a technique that made it possible to retrace processing of data in all other to charge, add or delete records in a file.

BLOCKING:- the storage of more than one term in a record.

COMPLIER:- a programming system applied by a manufacturer to convert a programme written in an automatic language into machine language.

EXPERT SYSTEM:- A computer system which embodies some of the experienced and specialized knowledge of an expert. it enables a non-expert to achieve comparable performance to an extent in the field.

PPLICATION PACKAGES:- These are computer programmes written for the purpose of carrying out specific task for individuals or organizations with similar or related needs.



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