1.1 BACKGROUND OF THE STUDY
Every Organization Private or Public, profit making or non-profit making, large or small scale, uses accounting information to make decisions, and the information need vary according to information each users require (Nickels, Mcchugh,& M.SM. 2002). Initially the appropriate information was prepared manually by the accountant, and this has a number of drawbacks. With the advent of Information Technology, the accountant now has at his disposal a number of accounting information tools that help in simplifying issues and providing quality information for the organization he/she renders services to. The sector that has been most radically affected by this development is the financial sector (Hassan, 2010).
The usage of information technology, broadly referring to computers and peripheral equipment has been a tremendous growth in service industries in recent past. The most obvious example is perhaps the banking industry, where through the introduction of information technology related products in internet banking, electronic payments, security investment and stock exchange, banks now provide more diverse services to customers with less manpower (Berger, 2003).
Information to a modern organization is a resource that is parallel in importance to land, labour and capital. It is a very vital and priceless resource. For centuries, man has tried to collect, store, process and retrieve information, and most importantly distribute or communicate it via the fastest means. Information therefore, is data that have been processed into meaningful and useable form and it contains knowledge that reduces uncertainty in a particular situation ( Senn, 1999).
However, information technology is a term which generally covers the harnessing of electronic technology for the information needs of businesses at all levels.
Today’s business environment is very dynamic and undergoes rapid changes as a result of technology innovations, increased awareness and demands from customers. Business organizations, especially the banking sector of the 21st century operates in a complex and competitive environment characterized by these changing conditions and highly unpredictable economic climate. Laudon and laudon, (1991), contend that managers cannot ignore information technology, because it plays a critical role in the advancement of contemporary organization.
Implementation of information technology were started in the early 2000s with emphasis of the adoption of core banking solutions, centralization of operations and complete automation of banks.
Information technology and e – banking have now become the key elements for strengthening the competitiveness of the national economy and improving the productivity and efficiency of both private and government banks. However, access to and use of these technologies remains extremely uneven.
According to Rahman I. (2008) the banking industry in Nigeria has witnessed tremendous changes linked with developments in information technology over the years. The quest for survival, global relevance, maintenance of existing market share and sustainable development has made exploitation of the many advantages of automated devices imperative in the banking industry. It is against this backdrop that this study seeks to examine the impact of information technology on accounting information system with particular reference to first Bank of Nigeria (FBN) Plc.
1.2 STATEMENT OF RESEARCH PROBLEMS
The Nigerian banking industry is characterized by high degree of inefficiency and ineffectiveness (Agboola, A.A, 2006). Banks in Nigeria render substandard and non qualitative services to their customers, and their delivery systems are antiquated and poor. Many banks in Nigeria have failed and liquidated in the past as fraud and related financial crimes was committed. This is owing to the fait that our bank still depend on ledger card and branch local network banking transactions when banking transaction in now “do it yourself affairs” in the advanced countries through network and online server provider.
Also “accurate records are not maintained in most of our banks, prompt and fair attention is not granted to customers” (Amaoko, A, 2012). All these lapses and deficiencies has accounted for the under development that is been experienced in our banking sector to withstand global competition from other banks in developed nations. The problems arises as to how information technology can be applied to banking operations in order to develop and improve the Nigerian Banking Industry.
The uses of information technology in accounting information system in first bank of Nigeria (FBN) Ltd does only bring about high productivity in terms of profitability (cost of expenditure related to acquisition of information).
Despite the easy access to accounting software, limitations still exists based on how well – trained the staff is and how confident they are in using the software. User error is a potential problem that could create in correct accounting data for the company.
1.3 OBJECTIVES OF THE STUDY
The objective of this study research work is to determine the impact of information technology on accounting information system in first bank Nigeria (FBN) Ltd. specifically, other objectives are:
- To determine the relationship between information technology on the accounting information system.
- To examine whether or not information technology in accounting information system helps to enhance banks performance in terms of profit in first bank Nigeria (FBN) Ltd.
- To determine whether access to banking services depends on factors influencing on service accessibility.
- To identify the demographic profile of customers involved in the use of modern day banking services.
1.4 RESEARCH QUESTION
- Does information technology helps to enhance bank performance in terms of profitability in first bank of Nigeria (FBN) Ltd?
- To what extent does information technology has significant relationship with accounting information system in first bank of Nigeria (FBN) Ltd?.
1.5 STATEMENT OF HYPOTHESIS
Below is the hypothesis formulated to be tested:
Hi: There is significant influence between information technology and the accounting information system in first bank of Nigeria (FBN) Plc, Bida branch.
1.6 SIGNIFICANCE OF THE STUDY
The primary purpose of information technology on accounting information system is to positively influence the performance of banks. At the end of this research work, the research will disclose that accounting information technology can bring about equivalent condition to profit and facilitate transactions between customers and their bank through easy means such as e-banking, e-business and so on. This study can as well be a base for further research work by other scholars, as it serve as a reference material.
1.7 SCOPE OF THE STUDY
The study covers the impact of information technology on the accounting information system of first bank Nigeria (FBN) Plc, Bida branch, Niger State. The study focuses on the performance and profitability of First Bank of Nigeria Bida, Niger State. The study period is two years (2013 – 2014) both years inclusive.
1.8 LIMITATIONS OF THE STUDY
Finance is one of the constraints that hindered the smooth conduct of this research, because it restricted the number of journeys to be made to study areas to collect data. Other limitations are:
Questionnaire that was served were not fully returned. This has limited the extent of expected. The bank understudy unwillingness to give responses, and also relevant information to the study, has little effect on final generalization. However, these limitations have no significant effect on the final outcome of the study.
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