THE IMPACT OF COMPUTER SYSTEMS ON ACCOUNTING AND AUDITING (A CRITICAL REVIEW)


Department Of Banking And Finance


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THE IMPACT OF COMPUTER SYSTEMS ON ACCOUNTING AND AUDITING (A CRITICAL REVIEW)

 ABSTRACT

This project intends to highlight the impact and effects of the use of computers by organization has on accountants and auditors. The various special problems inherent in the use of computers have been identified, and how they can be controlled or solved have been identified, and how they can be controlled or solved have been explained.

The researcher find out that: 

That there is a positive correlation between the use of computers by companies and productivity and efficiency of the companies, and

That the use of computer is relevant to the accounting profession. 

TABLE OF CONTENT

Title page

Approval page

Dedication

Acknowledgement

Abstract

Table of contents

CHAPTER ONE 

INTRODUCTION 

1.1 Background of study 

1.2 Statement of Problem 

1.3 Purpose of study 

1.4 Scope of the study 

1.5 Research question 

1.6 Significant of the study 

1.7 Limitation of study 

1.8 Definition of terms 

1.9 References 

CHAPTER TWO 

2.0Review of related literature

2.1 The computer a historical perspective

2.2 Definition of computer (EDP)

2.3 Accounting and computer  

2.4 The role of the accountant 

2.5 Audit of computer systems

2.6 Problems in the audit of computers 

2.7 Implications of computers for auditors 

2.8 The use of computer audit program 

2.9 Advantages of computer audit program 

2.10 Disadvantages of computers 

CHAPTER THREE 

FINDINGS, CONCLUSION AND RECOMMENDATIONS 

3.1 Findings 

3.2 Summary and conclusion 

3.3 Recommendations 

3.4 Bibliography

CHAPTER ONE 

INTRODUCTION 

1.1 BACKGROUND OF STUDY 

Accounting is the art of measuring, communicating and interpreting financial activity. Everybody works with accounting concepts and information in their daily activities whether preparing a household budget, balancing check book, preparing income tax return or running on association or an organization. 

Accounting, too, is a means of social communication in which changes and improvements are continually being made in order to communicate business information on more efficiently. That is as society has be come increasingly interested in measuring the profitability of business organizations, accounting concepts and technies hence been changing to make such measurements more meaningful and more reliable. 

The purpose of accounting is to provide financial information about an economic entity, in order to provide useful financial information about a business enterprise.

The basic function of an accounting system is to create a systematic record of the everyday business transaction in terms of moving. 

Published financial statements or reports have meaning to uses of accounting information is so far as an independent audit has given an unqualified report quit. Ti perform this, the auditor makes a careful study of the accounting system and gathers evidence both form within the business and form the outside sources.  

This evidence enables the independent audition to express his professional opinion as to the fairness and reliability of the financial statement. Since auditing complements accounting, the quality of the information deduced from the accounting procedural methods is being checked from time to time by auditing. Auditing is an independent examination of the books of accounts and source document of a business to enable the auditor satisfy himself whether the accounts so prepared exhibit a true and fair view of the financial position of the entity according to the best of the information and explanations of which he can avail himself and whether such statements conform to the necessary legal provisions. 

1.2 STATEMENT OF PROBLEMS      

The introduction of computer has not really made accounting job to become easier and quicker to perform. Another problem is, the computer operations has not been utilized in an organization by accountants. In some cases, the computer has not really reduced or added to the work load of an accountant in an organization. In general the accountants find it difficult to make sure that data submitted for decision –making process in adequate and timely as well as accurate. 

1.3 PURPOSE OF STUDY  

    The following objective were formulated by the researcher areas follows:-

⦁ To identify problems in changing from manual accounting process to a computer based accounting. 

⦁ To find out the difference between the manual and the computerized accounting system. 

⦁ To discuss the types of computer relevant for account9ing purposes.  

⦁ To find out the introduction of computer in accounting system in this country. 

1.4 SCOPE OF THE STUDY 

The scope of this study shall be restricted to only one type of computer which is the digital computer.

1.5 RESEARCH QUESTIONS  

  The following research questions were formulated by the researcher:

⦁ What are the responses of accountants in this country to introduction of computer in accounting system? 

⦁ What are the problems encountered in the process of changing from manual accounting process to a computer based accounting? 

⦁ What are the difference between the manual and computerized  accounting system. 

⦁ What are the problems encountered by auditors when auditing in a computerized environment? 

⦁ What types of computer is relevant for accounting purposes? 

1.6 SIGNIFICANCE OF THE STUDY 

The main significant of this research work is in the following ways: 

⦁ It will help the accountants to familiarize themselves with the uses and operations of computer. 

⦁ It examines how accountants are taking the challenges posed to them by the introduction of computer. 

⦁ The study will also help readers of this project to have a useful idea of computerized accounting system and recommend areas for further research in the field of computer as related to accountancy. 

⦁ It will help the accountant to advice their client or employer on the use of computer, because of this, an accountant must have a good knowledge of computer and its operations. 

1.7 LIMITATION OF STUDY

A study of this nature shall be limited to two specialized areas of accountancy Financial Accounting and Auditing . 

Financial accounting involves a lot of historical and transaction record-keeping while auditing involves the examination of these records which are kept either manually or in computer system.  

1.8 DEFINITIONS OF TERMS 

some of the technical terms that would be used on the study are explained below: 

ACCESS TIME: The internal nature taken to communicate with the memory of the digital computer. 

BINARY DIGIT: A digit in the binary scale of notation; it is either O or I.

APPLICATION: A program (or suite of programs)

PROGRAM/SYSTEM: which process data for a particular business function.  

HARDWARE: Any electric, electronic or mechanic equipment in an EDD installation. 

REFERENCES

1. T. Lucey, Management information system, 3rd Edition 

2. The Accounting Technology, Bulletin No. 1 of AICPA (1941)

3. P. Ironkwe, “The Pace of computing in Nigeria Part II”.

4. P.O Mgbse, “Introduction to computer” The Accountant, 

July/September 1983, Vol. I x VI, No. 3, P.4-9.  

5. T.W. Mcrae, Computer and Accounting, Published by Willey 

Org. 1976. P.60

.



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PRICE: ₦ 5,000.00




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