THE EFFECTS OF COMPUTERIZED ACCOUNTING SYSTEM ON THE PERFORMANCE OF BANKING INDUSTRY IN NIGERIA (STUDY OF SELECTED BANKS IN ENUGU METROPOLICS)

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

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.