WALLAGA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ACCOUNTING AND FINANCE

ROLE OF ACCOUNTING INFORMATION IN DECISION MAKING (IN

CASE STUDY OF AWASH INTERNATIONAL BANK IN DALO BRANCH )

THIS RESEARCH PAPER SUBMITTED TO COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ACCOUNTING AND FINANCE FOR THE REQUIREMENTS OF
PARTIAL FULFILMENT OF BA DEGREE IN ACCOUNTING AND FINANCE.

BY

NAME..............................................ID
1 TINSAE ............................1102908
2 SELAMNESH..........................1102773
3.ABRAHAM BARAKA.......................1102748
4 Aster Shifera..........................1102731
5 Aregash Gutema.......................1102720

ADVISOR: ZARA KEMAL (MA)

MAY, 2021

NEKEMTE, ETHIOPIA
 WALLAGA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ACCOUNTING AND FINANCE

APPROVED SHEET

Approved by:

Advisor Signature Date

………………………… ……………………….. ………………………

Examiner Signature Date

………………………… ……………………….. ………………………

Department head Signature Date

………………………… ……………………….. ………………………

Acknowledgement
First of all, we would like to prize the almighty God his unspeakable supports, saint virgin marry
for her special motherly contribution, angles and saints that protect me through all of my voyages
without interruption.

Secondly, my gratitude goes to my sincere and genuine advisor Zara Kemal (MA) for his
constructive and valuable comments and guidance in the preparation of this paper.

Thirdly, my heartfelt appreciation and special thanks goes to my families for their moral
(psychological), financial and materials supports which enable me to reach here.

Lastly, I would to express my appreciation and greatest thank for Awash International Bank
employees and manager for their heartedly wiliness and support to give valuable information for
my study.
Table of Contents

Acknowledgement.......................................................................................................................................3
Abstract.......................................................................................................................................................5
CHAPTER ONE..........................................................................................................................................6
1. INTRODUCTION...................................................................................................................................6
1.1. Back ground of the study..................................................................................................................6
1.2. Statement of the problem..................................................................................................................7
1.3. Research questions...........................................................................................................................8
1.4. Objectives of the study.....................................................................................................................8
1.4.1General objective.........................................................................................................................8
1.4.2. Specific objectives....................................................................................................................8
1.5. Scope of the study.............................................................................................................................8
1.6. Significant of the study.....................................................................................................................9
1.7. Limitation of the study......................................................................................................................9
1.8. Organization of the paper...............................................................................................................9
CHAPTER TWO.......................................................................................................................................10
2. Literature Review..................................................................................................................................10
2.1 Theoretical Literature Review.........................................................................................................10
2.1.1 Accounting Information and Decision Making.....................................................................10
2.1.2 The Accounting Information and Function..........................................................................10
2.2 The Value of Accounting Information.............................................................................................10
2.3 Types of Accounting Information....................................................................................................11
2.3.1 Managerial Accounting Information.....................................................................................11
2.3.2 Financial Accounting Information........................................................................................11
2.4 Decision Makers..............................................................................................................................11
2.4.1 The Users of Accounting Information...................................................................................11
2.5 Decision Making Process.................................................................................................................12
2.6 The Role of Accounting Information in Decision Making Process..................................................12
 2.7 Financial Statement its Role in Decision Making............................................................................12
2.7.1 Income Statement...................................................................................................................13
2.7.2 Balance Sheet..........................................................................................................................13
2.8 The Accounting Information and Accounting Cycle.......................................................................13
2.9 The Empirical Literature Review.....................................................................................................14
CHAPTER THREE...................................................................................................................................15
3. Research Methodology..........................................................................................................................15
3.1 Introduction.....................................................................................................................................15
3.2 Research Design..............................................................................................................................15
3.3 The Study Population......................................................................................................................15
3.4 Sampling Method and Sample Size.................................................................................................15
3.5 Data Collection Instruments and Procedures...................................................................................16
3.5.1 Primary Data Collection.........................................................................................................16
3.5.2 Secondary Data Collection.....................................................................................................16
3.6 Data Processing and Analyzing Method..........................................................................................16
CHAPTER FOUR.....................................................................................................................................17
4. PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA..............................................17
4.1 Primary Data Analysis.....................................................................................................................17
4.1.1 Profile of Respondent.............................................................................................................17
Table 4.1 Sex, age and marital status of the respondents.......................................................................17
Table 4.2 General qualification and educational level of the respondents.............................................18
4.2 Analysis of the Role of Accounting Information Decision Making Process....................................18
4.2.1 Role of Accounting Information in Decision Making Processes..........................................18
Table 4.3 Role of accounting information in decision making process of Awash International Bank...19
4.2.1 Accounting Information is properly reported to the Decision Maker................................19
Table 4.4 Preparation of the financial statement....................................................................................19
Table 4.5 Proper report of accounting information to decision maker...................................................20
Table 4.6 Easily getting available information......................................................................................20
Table 4.7 Qualification of accountants and gathering accounting information......................................21
Table 4.8 Preparation of financial statements with regard to principle of GAAP..................................21
4.2.3 Efficient Use of Accounting Information by Manager’s......................................................22
Table 4.9 Proper use of accounting Information by decision makers....................................................22
 Table 4.10 Understanding awareness of managers and economists used of accounting information in
decision making process........................................................................................................................22
Table 4.11 Effective, accuracy and reliability of accounting information in decision making process. .23
Table 4.12 Accuracy and reliability of accounting information in decision making..............................23
4.2.4 Problems related to with use of accounting information in decision making process........24
4.13 Problems related with the use of accounting information in decision making process...................24
CHAPTER FIVE.......................................................................................................................................26
5. FINDING, CONCLUSION AND RECOMMENDATION...................................................................26
5.1 Summary of Major Finding.............................................................................................................26
5.2 Conclusion.......................................................................................................................................26
5.3 Recommendations...........................................................................................................................27
Reference...................................................................................................................................................29
 Abstract
Accounting information is the most important requirement for decision makers to achieve the
banks objectives. Every bank workers should know the role of accounting information’s in
decision making process. The main objective of the study is to assess the role of accounting
information in decision making process of Awash International Bank in Dalo branch. The
specific objectives are also the assess how accounting information is reported to decision
makers, to evaluate how decision makers use accounting information in decision making process
and to identify the factors that hinder the role of accounting information not to play its role in
decision making process. To evaluate and examine this problem the researcher use the census of
complete numeration to collect data from workers of the bank. The research mainly used the
mainly used the primary source include questionnaires and unstructured interviewees. The
secondary data sources of data was collected from different written material for example
internet. The research used mixed Research design that is both qualitative and quantitative.

The collected data was analyzed and interpreted with explanation finally summary of major
findings taken from the study financial and managerial accounting information are used for
banks decision making and the majority of the respondents agreed on its difficult to get easily
available accounting information to decision making. The researcher conclude that the financial
statement of the bank were prepared at the end of the fiscal year however the accounting
information is not properly reported to decision makers also to different problems like, error in
recorded keeping of business transaction and inaccurate and irrelevant input data during
customer from service period.

The researcher also recommended since, the accounting information plays a vital role in
decision making process of one organization the Awash International Bank accounting
information should be relevant for decision makers and the bank should create awareness and
improve its functional workers in the use of accounting information in decision making process.
 CHAPTER ONE

1. INTRODUCTION

1.1. Back ground of the study

Accounting information is any data about an organization that is relevant to stockholders and that
can be used to monitor and make decisions about that bank, whether it be financial, operational,
or performance-oriented. (Collier, 2015). Throughout the world information about the bank is
accumulated by various government agencies and private organization. Bank information is
mentioned by many decision-makers. Including the manger’s financial analysis, stock holders
and customer groups. Accounting information is used for mangers, investors, creditors,
governmental employees and others use accounting information for economic resources to help
them in decision-making process.

In fact, accounting is, unquestionably, an important component of business information systems.

Generally, the role of accounting in business organizations is perceived to be the provision of
information for decision-making (Hayes, 1977). Accounting system provides useful
information to interested parties for decision-making and therefore information produced by
the accounting can determine organization success and sustainability in an innovation context
(Janka et al. 2020).
To ensure optimal conditions in (economic units) entity, in order that all business operators to
make effective and appropriate decisions, it’s necessarily to provide basic information, which
helps in this direction. In this case, because of its special role, differ the information provided by
the accounting.

Accounting is an information system that produces reports about economic activities of

economic units (entity) for all interested parties (stakeholders). Also, accounting provides
information for economic situation of unit and its performance for a certain period of time. This
information comes registering on time and correct way all economic transactions submitted by
financial numbers, which can be read and used by users. So, the role of information in the
direction of an economic system is very large (Dhamo, 2010). All those dealing with economic
unit (entity), are interested for the right and updated information, in order to come up to useful
economic decisions. As entity (economic unit) we recognize a group of people organized in a
particular way to do specific tasks in context of economic activities.
Decision-making was originally conceived as a completely rational, top-management process,
contemporary thinking recognizes that strategies from across multiple organizational levels
changes within social and political contexts”. Decision-making is either a reasoning or emotional
process that can be rational or irrational, based on explicit or tacit assumptions. Decisions are
likely to be involuntary and after the decision, we spend our time evaluating the costs and
benefits of such a decision (Doya & Shadlen, 2012).
Today, accurate accounting data is crucial for any organization's performance. For instance,
decision-makers such as managers, investors, creditors, and nonprofit organizations use
accounting information. The manager conducting day-to-day operations, planning for the future,
and formulating overall corporate plans can use accounting information as the foundation for
decision-making on business and economic issues (Brukhanskyi & Furman, 2017). Awash
International bank is one of process the organizations that uses accounting information for
decision-making and allocation of it transaction events to maximize its earning and profitability
in today’s competitive environment

The existence of important and the best accounting information has essential role in decision
making process of any bank or organization (Hertati et al., 2020). Therefore, assessment of the
role of accounting information in decision making at Awash International Bank is the main
objective of this paper.

1.2. Statement of the problem

For decision-makers, accounting information is the most crucial prerequisite. Accounting
information is used by numerous government agencies, nonprofit organizations, and possible
investors, lenders, and managers (Wang et al., 2018). Adequate accounting information plays a
general role in decision making process of the organization. Such as to decide the lending and
borrowing policy of the bank. Accounting information and decision making process would have
expressed as two faces of coins, since many organizations and institutions need accounting
information to increase their economy and to earn profit.
The management finds it challenging to determine the lending and borrowing policy of the bank
as well as estimating the bank's future results. These issues frequently arise when accounting
information is not used and does not perform its job well. The resulting statistical reports can be
used internally by management or externally by other investors parties including investors,
creditors and tax authorities (Firmansyah & Bayuaji, 2019).

According to the previous researcher studded at Debre Markos University in 2014, he identified
the problems commonly occur when accounting information is not used by bank workers there
are poor performance in decision making process loss of profit but,

See the problems that affect the decision-making process if the workers do not use the following
general accounting principles (GAAP).

- People the system user’s coordination.

- Procedure and instructions methods for retrieving and processing data.
- Data- information pertinent to the organizations business practices.
- Soft water- computer programs used to process data.
- Information technology infrastructure- hardware used to operate the system.
- Internal controls- security measures to protect sensitive data.
The bank used a decision-making process to determine the importance of accounting information
to managerial or financial decision-making processes, how accounting information is properly
reported to decision-makers, and how properly reported accounting information is used by both
internal and external users (Rashedi & Dargahi, 2019).

In addition to this the researcher would concerned how decision makers use accounting
information in decision making efficiently. Efficient accounting information would be used for
them to now the performance of the bank and its current and future situations to identify.

The last issue is also the elements that prevent accounting information from being used in the
bank's management decision-making process, as the previous researcher mentioned the problem
above, the study was lacks by its full of solution for their problems. Therefore, this researcher is
attempting to fill the gap and discover these issues related to the topics by assess the role of
accounting information in the decision making process in the case of Awash International Bank
in Dalo branch.

1.3. Research questions

 How accounting information is properly reported to decision makers?
 How accounting information plays its important role in decision making process?
 How decision makers use accounting information in decision making process?

1.4. Objectives of the study

1.4.1General objective
The general objective of the study is to assess the role of accounting information in the decision
making process in the case of Awash International Bank in Dalo branch.

1.4.2. Specific objectives

This study was tried to achieve the following specific objectives concerning to the role of
accounting information in decision making.

 To assess how accounting information is properly reported to decision makers. ‘

 To identify the decision making process that accounting information’s plays its important
role in the bank.
 To evaluate how decision makers use accounting information in decision making process
efficiently

1.5. Scope of the study

The study is concerned with the assessment of role of accounting information in decision
making. This study make investigation only and limited to Awash International Bank at Dalo
branch and its related with accounting information in decision making process.
1.6. Significant of the study
The study was identified the problems concerning to the role of accounting information in
decision making in the organization and emphasis the following points.

It will help to Awash International Bank decision makers and organizations to overcome the
problem arising from in efficient processing of accounting information. It will access the
students for knowledge of accounting information in decision making. It will use to perform
better study on filed and come up with relevant information for future researchers

1.7. Limitation of the study

The following were constraints that limited researcher work:
 Lack of reference material and source on related topics.
 Lack of experience.
 Unwillingness of interviewees.

1.8. Organization of the paper

The study has organized in five chapters. The first chapter has concerned with the background of
the study, statement of the problems and objective of the study, scope of the study, significant of
the study and limitation of the study. The second chapter deals with review of literature. The
third chapter deals with research methodology,. The fourth chapter deals with data analysis and
interpretation, the fifth chapter deals with major finding, conclusion and recommendation.
 CHAPTER TWO

2. Literature Review

2.1 Theoretical Literature Review

2.1.1 Accounting Information and Decision Making
The definition of accounting is the process of gathering accounting data and using it to make
defensible judgments and economic decisions. Accounting is mostly used to assist people in our
society in making economic decisions. Resources must be distributed to different types of
entities. (Bauwens & Niaros, 2017)

In management accounting, decision-making may be simply defined as choosing a course of

action from among alternatives. If there are no alternatives, then no decision is required. A basis
assumption is that the best decision is the one that involves the most revenue or the least amount
of cost. Decision making is the process of making choices by identifying a decision, gathering
information, and assessing alternative resolutions. Using a step-by-step decision-making process
can help you make more deliberate, thoughtful decisions by organizing relevant information and
defining alternatives (Li et al., 2023).

2.1.2 The Accounting Information and Function

The accounting information provides the basis for making decision about resources allocation.
Most business decisions cannot make without careful analysis of relevant information. The
accounting function is the financial information of the bank. In this regard accounting plays
important role in transaction processing, capturing and recording events. Accounting information
is essential to the decision making process. If provides information for three functions: planning,
controlling and evaluating (Vokshi & Krasniqi, 2017).

 Planning:- is the processes if formulating course of actions.

 Controlling:- is the process of seeing what plans are carried out.
 Evaluating:- is the examination of the whole decision making process to the end of
improving it and up.

2.2 The Value of Accounting Information

The value of accounting to users are defer main by its reliability. The purpose information is to
lead the user’s to desired action for this to happen information must pass certain attributes,
relevance, and accuracy.
Completeness are consistently present information has reliability and provides value to user’s
informant lacking reliability has no value. The negative implication of reliable information is that
it can load to poor decision (Sleesman et al., 2022).

2.3 Types of Accounting Information

Accounting has defined as earlier as an information system that measures, processes and
communicates information that is useful for decision making distinctions commonly is made
between the field of managements accounting information and financial accounting information.

2.3.1 Managerial Accounting Information

Both historical and estimated data used by management in conducting daily operation, planning
future operations and developing the overall strategies. Management accounting reports may
stress different futures of the managerial accounting provides internal decision who is engaged
with information about financing, investing and operating activities.

2.3.2 Financial Accounting Information

Financial accounting information that are prepared according to generally accepted accounting
principles (GAAP). This statements report the past results of operations and financial conditions
of the business they are prepared primary the benefit of a persons or institutions that are outside
or external to the organization. This statements are also useful to management in directing the
performance of the bank, for example in planning future operations managers to benefit by
evaluating the results of past activities as reported in financial statements.(Palepu et al., 2020)

2.4 Decision Makers

2.4.1 The Users of Accounting Information
Accounting and accounting information are used more widely that commonly realized. The users
of accounting information can be divided roughly into three groups.

1. Those who managers business.

2. Those outside a business who have a direct financial interest in the business.
3. Those people organizations and agencies that have an indirect financial interest in the
bank.

The user of accounting informational are:-

I. Management:
It the groups of people who have overall responsibility for operating business and for
meeting the banks goals. Management may include the owner, in large business
management more often consists of people who are littered. Business organization have
many varied and often complex objectives. Thus includes mantling an accepted level of
earnings and providing services. To accomplish these and other tasks the companies must
be successful. Managers should decide what to do, how to do it and whether the result
 Mach their goal. Manager’s consistently make the right decisions on the basis of timely
and valid accounting information what was the company’s net income during the period.
II. Users with a Direct Financial Interest
Another major function of accounting is to measure and reports information about how to
perform. Most business periodically published asset of general purpose of financial
statement that report their success in meeting the objective of profitability and liquidity,
these statements show what has happened in the past and are important indicators of what
is going in the future, many people outside the bank carefully study these financial
reports including,
1. Present or potential investors: thus who invest or may invest in a bank are
interested in the past success of the business and potential earning before
investing the investor reviewing the bank’s financial statement.
2. Present or potential creditors: most companies borrowed money for long and short
term operating needs creditors those who lend money or rendering services before
being paid it must analysis a company’s financial position before they make alone
to the company.
III. Users with Indirect Financial Interest
Society as a whole through government and public group in recent years has become one
of the biggest most important users of accounting information. Users who need
accounting information to make decision on public issues including: tax authorizers,
regulatory agencies, economic planners and other groups.(Bennett et al., 2015) .

2.5 Decision Making Process

Decisions making is the act of decision between two or more alternative course of action. In
running day to day business activities accounting information and techniques are used to
financial decision making process (Salam, 2022).

2.6 The Role of Accounting Information in Decision Making Process

There are many use of accounting information in decision making. Managers scan account
records to spot problems are to focus on, lenders use accounting records to determine risky loan
founds to a company might be, tax authorities can decide it bank has paid the right amount of tax
by analyzing the firms accounting information (Zucman, 2014). There following activities are
also made based on the accounting information:

 Investing decision
 Management decision
 Lending decision
 Taxes.
2.7 Financial Statement its Role in Decision Making
Financial statements: are the accounting reports that provides the accounting information to the
users. A bank often provide as accounting information to managers’ and other decision makers
in its financial statements. The statements are useful because they describe the banks financial
health and performance in accoutered and highly informative format because they provide an
overall view of the entire banks through accounting information financial statement are good
place to study.

2.7.1 Income Statement

Income statement is useful because its shows whether the business earned a profit/net income. A
bank earns a net income its revenue excess its expenses. A bank incurs loss if its expenses
exceed its revenues. So managers consider all those to make decision.

Revenues: are inflows of assets received in exchange of for services provided to customers as
part of the major or central operations of the business revenues also may occur as a decrease in
liabilities.

Expenses: are out flows or the using up of assets as a result of the major or central operation of a
business it may occur as increase in liabilities.

2.7.2 Balance Sheet

The purpose of the balance sheet is to provide information that helps uses understand a bank’s
financial status as a result, the balance sheet is often called the statement of financial position.
The balance sheet describes financial position by listing the types and dollar amount of assets,
liabilities and equity of the business.

Assets: are probable future economic benefits obtained to controlled by particular entity as result
of past transaction or event in other words they are economic sources owned by business that are
expected to benefit future bank operations.

Liabilities: are probable future sacristies of economic benefits arising from present obligations
of a particular entity to transfer assets or provide services to other entities in the future as a result
of past transactions or events.

Equity: is the residual interest in the asset of an entity that remains after dedicating its liabilities
in the business equality is called the ownership interest (Allen et al., 2021).

2.8 The Accounting Information and Accounting Cycle

An accounting cycle; is the sequences of accounting procedures used to record, classify and
summarize of accounting information. It begins with the initial recording of business transactions
and concluded with the preparation of financial statements summarizing the effects of these
transactions up on the asset, liabilities and owners’ equity of the business. If includes the
following steps:
 1. Recording business transaction and events in the journals.
2. Classifying data by posting from the journals to the lager.
3. Summarizing data from the lager in an unadjusted trial balance.
4. Adjusting, correcting and updating recorded data completion of the sheet wrote.
5. Summarizing adjusted and corrected work sheet data in the form of financial statement.
6. Closing the accounting records (nominal accounts) to summarize the operation of
accounting period.
7. Preparation of post-closing trial balance.
8. Reversing certain adjusted unites to facilitate the recording process in the subsequent
accounting period.

Financial reporting intended to provide information that will be use full in making decisions.
This objectives influences accountant’s prepare accounting information for financial purpose. It
also decision oriented objectives were specified the way data measured and reported would
change grammatically (Harrison, 1989).

2.9 The Empirical Literature Review

Accounting to William J Burns (2003), the role of accounting information is important for
decision making process. The research considers the following three statements for the role of
accounting information for decision making (Botchway & Rashedi, 2020).

 If a counting information is not prevent by decision makers to decision under

consideration a change affects the researcher’s decision.
 The concept of accounting information held by a decision maker on how will the
accountant and accounting system measures a significant attributes and factors affecting a
decision making process towards the accounting information.
 The availability of the accounting information will an important betterment for decision
makers to accounting information.

Accounting information is essential to decision making system. Because it provides qualitative

information for three functions. Because it provides qualitative information for three functions.
Those are: planning, controlling and evaluating. The research suggested that also the accounting
information is important for measuring, processing, and communicating information that is
useful to make business decisions (Hertati et al., 2020).
 CHAPTER THREE

3. Research Methodology

3.1 Introduction
Methodology is one of the key components needed to carry out this research. This is due to the
fact that research cannot be conducted without proper technique. Additionally, this research
included crucial information about the population, the sampling technique, the research design,
and data gathering techniques.

3.2 Research Design

The researcher was used descriptive research design in order to achieve the objectives of study.
The researcher also used both qualitative and quantitative techniques to analysis collected data.
Because to describe the collected data about the role of accounting information for decision
making this techniques are suitable. Why? Because mixed-method research has advantages that
balance the drawbacks of both types of research, makes it simple to create and test new tools
(phenomena), and may be used to answer problems at various levels.

3.3 The Study Population

In conducting this research, the researcher would use the managers, accountants and the
economists of the Awash International Bank workers who are voluntary to give available and
reliable information about the role of accounting information decision making in the bank.
Currently, the bank has 11 staff members of total works. There are one managers, one auditor,
one accountant, and eight customer service render get population for study was employed
available of Awash International Bank Dalo branch.

3.4 Sampling Method and Sample Size

In conducting this research, the researcher would use non probability sampling technique that is
censes. Because in order to acquire the relevant data the researcher would draw census or
complete numeration which enables the researcher to reduce sampling error and to get detail
information from the target population business statistics.

The sample size is 100% of the total population because in census the total population and the
sample size are equal.
3.5 Data Collection Instruments and Procedures
3.5.1 Primary Data Collection
The primary data would be collected from the employees through questionnaire and through
depth interview from the manager of the organization and the researcher dominantly used the
primary sources.

3.5.2 Secondary Data Collection

The secondary data was collected from different written materials for example internet. The
secondary source of data will be gathers from books, document and records which are related to
role of accounting in decision-making on the organization.

3.6 Data Processing and Analyzing Method.

The study will be present the collected data in tabular and percentage form in order to made the
study easy. In the study descriptive analysis will be used because its simplicity and clarity to
draw conclusions. After collecting data the researcher would try to edit, code and classify the
collected data. The researcher would be used instruments of electronic calculator of change the
data in the form of percentage. The researcher would use descriptive and interpreting of the
collected data by using the researcher would be presented the research finding reports,
conclusion and recommendations.
 CHAPTER FOUR

4. PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA

This chapter deals with the presentation, analysis, and interpretation of information obtained
through questionnaires and interviews that employees and the manager of Awash International
Bank completed and responded to.

There were 11 employees in all who made up the population of the study. Every single employee
who received a questionnaire completed it and returned it. The bank manager was also the
subject of an interview.

As a result, information is presented, examined, and evaluated using tables and percentages
depending on the data collected from the population.

4.1 Primary Data Analysis

4.1.1 Profile of Respondent

Table 4.1 Sex, age and marital status of the respondents

No Item Respondents Number Percentage
Sex
Male 7 64%
1 Female 4 36%
Total 11 100%
Age
20-35 years 8 73%
2 35-50 years 3 27%
Above 50 years
Total 11 100%
Marital status
Single 4 36%
3 Married 7 64%
Divorced
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
According to the aforementioned table 4.1 item 1, 4 (36%) of the population respondents are
women, leaving 7 (64%) of the respondents to be male employees. This demonstrates that men
made up the majority of the workforce. As shown in the above table item number 2 regarding the
respondents' ages, around 8 (73%) of the population as a whole is between the ages of 20 and 35,
and the remaining 3 (27%) is between the ages of 36 and 50. This demonstrates that most of the
staff at Awash International are adults. The respondents' marital status is shown in item number
3 of the table above. It reveals that 4 (or 36% of respondents) are single, while 7 (or 64%) are
married. From this the researcher can conclude that, the majority of the employees are married.

Table 4.2 General qualification and educational level of the respondents.

No Item Respondents Number Percentage
Accounting 5 46%
Management 3 27%
1 Qualification Economic 3 27%
Banking and finance
Total 11 100%
Educational 12 grade completed
st

background Certificate
2 Diploma
Degree 9 82%
Master 2 18%
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
In the table 4.2, item number 4, it is shown that 5 (46%) of the respondents had accounting
degrees, 3 (27%) had management degrees, and the remaining 3 (27%) had economics degrees.

The educational backgrounds of the responder employees are shown in the above table item
number 5. It reveals that 9 (82%) of the respondents have degrees, while the remaining 2 (8%),
have master's degrees.

The researcher deduced from this that degree-holders make up the bulk of the Awash
International Bank staff.

4.2 Analysis of the Role of Accounting Information Decision Making Process

4.2.1 Role of Accounting Information in Decision Making Processes
When making decisions that have an impact on business and economic matters, accounting
information is crucial. Making decisions requires the use of accounting information. It offers
data for planning, managing, and performance evaluation.

Table 4.3 Role of accounting information in decision making process of Awash

International Bank
No Item Response Respondents Percentage
 Number

1 Does accounting information play its Strongly agree 2 18%

important role in decision making
process of Awash International Bank? Agree 7 64%

Disagree 2 18%

Strong Disagree

Total 11 100%

Respondents Source: Completed from questionnaires 2023.

According to the above table, 2 respondents (18%) strongly believe that accounting information
plays a part in the bank's decision-making processes, whereas 7 respondents (64%) agree and the
remaining 2 respondents (18%) are neutral. This demonstrates how important accounting
information is to banks. Because it offers relevant information for making decisions.

4.2.1 Accounting Information is properly reported to the Decision Maker

Accounting information provided by the accountant should be clear and timely reported for
decision makers in the form of a financial statement in order to help them make wise decisions.

Table 4.4 Preparation of the financial statement

No Item Response Respondents Percentage
Number
Yes, weekly
2
Do you prepare your own Yes monthly 4 36%
financial statement for decision
making? How often? Yes, semiannually 3 28%

Yes, annually 4 36%

No

Total 11 100%

Respondents Source: Completed from questionnaires 2023.

According to the aforementioned table 4.4, 4 (36%) of respondents said the bank prepares its
financial statements on a monthly basis, 3 (28%) of respondents said it does so semiannually,
and the remaining 4 (36%) respondents said the same about its annual preparation. Financial
statements that are prepared monthly and semi-annually are used to track progress at regular
intervals. Financial statements are often created at the year's conclusion and used by both internal
and external consumers.
Table 4.5 Proper report of accounting information to decision maker
No Item Response Respondents Percentage
Number
3 Does accounting information properly Strongly agree 1 9%
reported to decision makers? Agree 3 27%
Neutral 3 27%
Disagree 4 37%
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
Table 4.5 indicates that 3 (27%) respondents strongly agree that the accounting information is
reported to decision makers in a proper manner, while 1 (9%) of respondents strongly disagree.
While 4 (37%) of the respondents disagreed with the appropriate reporting of accounting
information to decision makers, 3 (27%) of the respondents were indifferent on the matter. This
suggests that decision-makers are not receiving the accounting information in a proper manner.

Table 4.6 Easily getting available information

No Item Response Respondents Percentage
Number
4 Does the manager of Wash Strongly agree
international bank get available Agree 4 36%
accounting information easily? Neutral 3 28%
Disagree 4 36%
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
Table 4.6 shows that the manager can obtain accounting information readily; 4 respondents, or
36%, agreed that the manager can obtain accounting information. Three respondents (20%) are
indifferent, whereas four respondents (36%) disagree with this. These results demonstrate that
the majority of respondents said it was challenging to obtain the available accounting
information for decision-making.

Table 4.7 Qualification of accountants and gathering accounting information

No Item Response Respondents Percentage
Number
5 Does Awash International bank Strongly agree
accounts and managers are gathering Agree 3 27%
 accounting information for decision Neutral 6 55%
making process? Disagree 2 18%
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
According to table 4.7 above, 3 respondents (or 28% of the total) agreed that managers and
accountants should be qualified to acquire accounting data for decision-making, whereas 6
respondents (or 55% of the total) had no opinion. Therefore, the researcher draws the reasonable
and acceptable conclusion that managers' and accountants' qualifications for acquiring
accounting information are on the average level.

Table 4.8 Preparation of financial statements with regard to principle of GAAP

No Item Response Respondents Percentage
Number
6 Does the bank accounting prepared Strongly agree 3 27%
financial statements based on GAAP? Agree 6 55%
Neutral 2 18%
Disagree
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
According to the aforementioned table, 3 respondents (or 27% of the total) strongly agreed that
bank accountants generate financial accounts in accordance with GAAP. 2 (18%) respondents
are neutral, whereas 6 (55%) respondents are in agreement. As a result, Awash International
Bank's accountants create financial statements using the GAA principle.

4.2.3 Efficient Use of Accounting Information by Manager’s

Manager’s used accounting information efficiently. Because accounting information is essential
to play an important role in the decision making process.

Table 4.9 Proper use of accounting Information by decision makers

No Item Response Respondents Percentage
Number
7 Does Awash International Bank Strongly agree 2 18%
 manager’s properly using accounting Agree 5 46%
information in decision making Neutral 2 18%
process? Disagree 2 18%
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
As shown in table 4.9 above, 2 respondents (18%) strongly agree that managers should use
accounting information when making decisions, 5 respondents (46%) agree, 2 respondents (18%)
are neutral, and the remaining 2 respondents (18%) disagree that managers should use
accounting information when making decisions. The researcher therefore draws the conclusion
that the majority of respondents believed that managers should use accounting information
appropriately when making decisions.

Table 4.10 Understanding awareness of managers and economists used of accounting

information in decision making process
No Item Response Respondents Percentage
Number
8 Does manager and economists have Strongly agree 1 9%
adequate understanding of awareness Agree 3 27%
about the use of accounting Neutral 2 10%
information indecision making Disagree 5 46%
process Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
According to the data in the table above, 1 (9% of respondents) strongly agree that bank
managers and economists have a sufficient understanding of or awareness of the use of
accounting information in decision-making, followed by 3 (27%) agreeing, 2 (18%) neutral, and
the remaining 5 (46%) disagreeing. This demonstrates that the majority of managers and
economists are not adequately knowledgeable about or aware of how to use accounting
information in the decision-making process.

Table 4.11 Effective, accuracy and reliability of accounting information in decision making
process
No Item Response Respondents Percentage
Number
9 Is manager of Awash International Strongly agree 2 18%
Bank use accounting information Agree 5 46%
effectively? Neutral 2 18%
Disagree 2 18%
Strong Disagree
 Total 11 100%
Respondents Source: Completed from questionnaires 2023.
5(4%) of respondents strongly agree that the bank manager uses accounting information
efficiently, as shown in the of the bank uses accounting information efficiently, as shown in the
previously mentioned table 4.11 item number 9. However, 2(18%) respondents do not.
Additionally, the manager's successful use of accounting information was agreed upon by 2 (or
18%) of the respondents, 2 (or 18%) of whom were indifferent, and 2 (or 18%) of whom also
disagreed. This demonstrates that the majority of managers effectively use accounting
information in their decision-making processes.

Table 4.12 Accuracy and reliability of accounting information in decision making

No Item Response Respondents Percentage
Number
10 Is the use of accounting information Strongly agree 1 9%
accurate and reliable for decision Agree 3 27%
making of your bank? Neutral 4 37%
Disagree 3 27%
Strong Disagree
Total 11 100%
Respondents Source: Completed from questionnaires 2023.
From table 4.12 item number 10 shows that 1(9%) of the respondents also agree, 4(57%) of the
respondents are neutral and 3(27%) of the respondents were disagreed with the use of accounting
information is reliable and accuracy. Therefore, the bank use of accounting information
indecision making process is averagely accurate and reliable.

4.2.4 Problems related to with use of accounting information in decision making process.
When you perform day to day activities it may occur problems regarding to the use f accounting
information in decision making process. Table

4.13 Problems related with the use of accounting information in decision making process.
No Item Response Respondents Percentage
Number
11 Does manager and economists have Yes 7 64%
adequate understanding of awareness
 about the use of accounting No 4 36%
information indecision making
process
Total 11 100%
12 If your answer for question 11 is yes  Errors of financial statements
list the problems  Error in business transaction
 Problem in record keeping
 In accuracy of input data and irrelevant
information.
Respondents Source: Completed from questionnaires 2023.
As seen in the table mentioned above 4.13, question number 11 reveals that 7 (or 64% of
respondents) agreed that there is an issue with using accounting information for decision-
making. The remaining 4 respondents (36%) who gave a yes answer mentioned a few issues with
the accuracy of the data input, the effectiveness of the financial statements, and mistakes in the
recording of business transactions. These issues are related to the use of accounting information
in decision-making. Thus, the aforementioned issues are related to the use of accounting data in
the decision-making process.

Analysis of an interview question given by the Awash International Bank manager.

1. Accounting information indecision making process.
The preparation of financial statements, according to the management of Wash
International Bank, starts with the client from services, recording customer information
and processing it to give the user and the bank readily available information.

According to the manager, the flow of accounting information and decision-making

typically follows a distinct procedure from client front services all the way through
information processing to provide meaningful decision outcomes.
2. Factors affect or hinder accounting information not to play its role in decision making
process of the bank are
The manager responds that the system installed that affects the bank's daily operations
does not quickly transmit information and does not perform properly, efficiently,
relevantly, and accurately data during the recording time of customers is one of the
factors that affects the accounting information not to play its role for Awash International
Bank. Awash International Bank's issues include the absence of highly skilled
professionals in the accounting field and the electricity crisis.
3. Organizational mechanisms to solve problems
The manager stated that the bank employs highly qualified personnel and professionals
related to record keeping of customer information and the banks for the use of decision
makers in order to address issues with the use of accounting information for decision making.
The manager also stated that the bank strives to maintain accurate, reliable, and timely
accounting records of customer front services for the users of accounting information for
 decision making process. The implemented system makes an effort to be quick by utilising
current technical connections.
4. Advantage of using of accounting information in decision making process.
The benefits of using accounting data in decision-making processes assist the management in
making quick decisions pertaining to the bank, measuring and reporting how the business is
actually running, and demonstrating the performance of the bank by creating accurate
financial statements.

CHAPTER FIVE

5. FINDING, CONCLUSION AND RECOMMENDATION

The researcher has come to the following conclusions, recommendations, and findings based on
the results of the analysis and interpretation of the study on the use of accounting information in
decision making.

5.1 Summary of Major Finding

 The researcher evaluated how accounting information affected Awash International
Bank's decision-making. The research yielded the following conclusions.
 Since it offers pertinent records of customer information during customer care,
accounting information is essential to a bank's decision-making process.
 According to the vast majority of respondents, management teams who plan the bank's
lending and borrowing policies need accounting information.
  Financial and managerial accounting data are essential for developing the overarching
goals of Awash International Bank's business strategy and for providing information
about the bank's upcoming operational plans.
 The majority of respondent also agreed that the financial statements of the bank are
prepared annually at the end of the fiscal year.
 The GAAP standard serves as the foundation for the bank's financial statement
production.
 Due to the network breakdown and inaccuracies in accounting records, the majority of
respondents concurred that it is challenging to obtain readily accessible accounting
information for the bank's decision-making.
 According to the majority of respondents, there are issues with correct and irrelevant data
recording during customer front-of-house service time, inefficient financial statements,
and mistakes in business transaction records that are related to the use of accounting
information in decision-making.

5.2 Conclusion
In order to evaluate the relevance of accounting information in the decision-making process, the
researcher did his senior essay study at Awash International Bank. The study's target population
consisted of 11 Awash International Bank employees, who were the subject of questionnaires
and interviews with bank managers.

Based on the major finding of the study the following conclusion is drawn.

 The management bodies of the bank use accounting information as part of their decision-
making process to determine the lending and borrowing policies for the institution.
Information from management and financial accounting is used by the bank to carry out
daily operations and create its overall business strategy. The principle serves as the
foundation for the creation of financial statements.
 The bank's financial statement is mostly created at the conclusion of the fiscal year.
However, a number of issues, such as a failed attempt to terminate a system connection,
prevented the bank's accounting data from being correctly communicated to decision
makers. This results in the accounting information not being transferred quickly and the
accounting workers not performing their tasks correctly, quickly, and efficiently from the
customer's services up to the creation of financial statements to alter the information that
is available to bank decision-makers.
 Issues with maintaining accurate records, errors in documenting business transactions,
and inaccurate and irrelevant input data during customer service times were the issues
that were related to the usage of accounting information.
 Another reason why accounting information isn't used in the bank's decision-making
process is the issues with the electric power supply.
5.3 Recommendations
Following the identification and based on it the researcher has come up with the following
recommendations.

 Accounting data is essential to an organization's decision-making process. Because of

that the decision-makers should find the accounting data from the Awash International
Bank useful. The accounting information should be useful to users in order for managers
to make correct, pertinent decisions about the bank's present and future plans and to fulfil
the bank's objectives.
 Because of diverse internal and external users use the financial statements regularly, the
Awash International Bank should also prepare them frequently, with the periods of
weekly, monthly, in addition to semiannually. The preparation of financial statements on
a weekly and monthly basis assists the bank in tracking daily performance and
concentrating on the state of the company.
 The Awash International Bank should provide training and development programs about
how to gather accounting information in accordance with and report the accounting
information in decision-making processes to its functional workers who are involved in
the bank's activities, in particular on the use of accounting information for decision-
making.
 The bank should also raise awareness and ensure sufficient understanding of the use of
accounting information in managerial decision-making because management plays a
crucial role in controlling the bank's daily operations and making decisions on its behalf.
As a result, management should have sufficient knowledge of the use of accounting
information for decision-making.
 In addition to keeping records properly, making them readily available, and transferring
accounting information to decision makers on time through the reduction of error, Awash
International Bank should also address issues with the use of accounting information in
the decision-making process by ensuring that the input data from customer front services
is accurate, pertinent, and used on time.
 The Awash International Bank also has a problem with the availability of electricity, so
the bank should needs to pay close attention to this since electricity is necessary to carry
out the bank's daily accounting information activities. This means that the problem needs
to be identified and replaced by a generator, incurring additional costs, so that customers
receive adequate service without any power issues.
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 Appendix

Wallaga University Faculty of Business and Economics

Department of Accounting and Finance

Dear respondents!

This questionnaire is prepared to obtain primary data on the assessment of the role of accounting
information in decision matching process of the Awash International Bank.

The respondent kindly requested to give relevant information and your cooperation is valuable
and complete response will be keep confidential and used only for academically research
purpose.

Direction

 There is no need of writing name

 Please indicate your answer by putting “”

Part I personal information

Personal information

1. Sex male female :

2. Age: 20 – 3 5 36- 36-50 above51
3. Martial statues :single Married divorced
4. Qualification :Accounting economics Management
Banking and finance if any specify
5. Educational back ground: Diploma Degree Masters

Part II of the questionnaires

The following questions concerned about the role of accounting information in decision making.

1. Does accounting information plays important role in decision making process of the
Awash international bank?
Strongly agree Agree Disagree
Strongly disagree Neutral
2. Business organizations normally prepare their financial statements. Do you prepare your
own financial statements for decision making process? How often?
Yes, weekly yes, semiannually
Yes, monthly yes, annually No whatever
3. Does reported properly accounting information to decision makers?
 Strong agree Agree Disagree
Strongly disagree Neutral
4. manager of Awash International Bank get useful accounting information easily
Strongly agree Agree
Strongly disagree Neutral Disagree
5. Awash International Bank accountant and managers are well qualified in gathering the
accounting information for decision making process
Strongly agree Agree Disagree
Strongly disagree Neutral
6. Accountants of Awash International Bank prepared financial statements based on GAAP
Strongly agree Agree Disagree
Strongly disagree Neutral
7. Awash International Bank manager properly use accounting information for decision
making process
Strongly agree Agree
Strongly disagree Neutral Disagree

8. Manager and economists in Awash International Bank have adequate understanding or

awareness about the use of accounting information in decision making
Strongly agree Agree
Strongly disagree Neutral Disagree

9. The use of accounting information in decision making process is accurate and reliable for the
bank
Strongly agree Agree
Strongly disagree Neutral Disagree

10. Is Awash International Bank managers use accounting information effectively?

Yes No
11. Is there any problem in relation with using of accounting information indecision making
process of the bank? Yes No
12. If your answer for question 11 is yes places mention them _________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________

Interview question for the manger

1. What is the flow of accounting information in decision making process?
________________________________________________________________________
________________________________________________________________________
_______________________________________
2. What factors affect hinder accounting information not to play is role in decision making
of the bank?

3. How the bank try to solve the problems related to the use of accounting information?
_________________________________________________
_____________________________________________________________
4. What is the advantage of using of accounting information in decision making process?
_______________________________________________
________________________________________________________________________
________________________________________________________________________
_______________________________________