DECLARATION

I hereby declare that this project is written by me and represents a record

of my own research efforts. It has never been presented before in any
application for a degree or any reputable presentation. All borrowed
ideas have been duly acknowledged by means of references and
quotation marks.

NCHE CLOVIS TANGIE

SM14C255
(Researcher)

Sign: .............................. Date: ......................

The above declaration is confirmed by:

MR BONDJA ALAIN
(Supervisor)

Sign: .............................……. Date: .....................

i
 CERTIFICATION
This is to certify that this Project entitled “The Impact of Information
and Communication Technology (ICT) on Accounting Systems in
Financial Institutions” presented by NCHE CLOVIS TANGIE
(SM14C255) meets the project requirements and regulations governing
the Award of a Bachelor of Science (B.Sc.) degree in Accountancy at
the University of Buea and is therefore approved for its contributions to
scientific knowledge and literacy presentation.

Mr. BONDJA ALAIN

(Supervisor)

Sign: ..............................… Date: .....................

Prof. Minkoua Jules Rene Nzhie

(Head of Department)

Sign: ................................................ Date: ...............

ii
 DEDICATION
This piece of work is dedicated to GOD ALMIGHTY for His abundant Grace and
Mercy. Thank you LORD!
And

To my father in the Lord Apostle Divine C.Okafor for all his spiritual and financial
support and lastly my family

iii
 ACKNOWLEDGEMENTS
I would like to in a very special way, thank my supervisor MR BONDJA ALAIN
who took pains upon his tight schedule to guide, correct and proof-read this piece
of work. Unreserved gratitude equally goes to the entire staff of Ecobank Buea
My sincere gratitude likewise, goes to the lecturers of the accounting programme,
notably Mr Hanko Osee (programme coordinator) and DR. PAUL N. ACHA. The
realisation of this piece is thanks to your relentless strive towards imparting
Knowledge. You will never regret your efforts.
I am also very much indebted to my sponsors, parents and guardians, and must
acknowledge in a special way Mrs. ORU HANNAH (my sponsor and guardian)
and Mr. and Mrs. RICHARD CHE (my parents). I wonder how this journey would
have been without your daily interventions. The lord will replenish all sources
abundantly. To mention any friend’s name in this piece of work will be biased,
otherwise, the list of friends will make the report. To this end therefore, I do
acknowledge the support of all my friends in school and at home. You will never
walk alone!
Finally to the provider of knowledge, inspiration and wisdom, Jehovah specific.
Your rays of light and good fortunes have never side-lined me. Once more, Thank
you LORD!

iv
 ABSTRACT
The use of Information Communication Technology devices has become a
customary practice in the banking industry. Information technology has led to
improved performance, speed and accuracy and generally reduced the length of
transaction processing processes and procedures. It was in line with these that the
study aimed at examining the impact of ICT on accounting systems in financial
institutions in Cameroon. The study samples one bank branch; ECOBANK S.A
Buea branch. Using five variables in a four-section questionnaire of 18 Likert-type
and open ended questions, bankers per the responses returned, assert 100% that
ICT has a positive impact on their accounting systems. This has been confirmed by
a descriptive statistics carried out and calculated the percentage of agree and
strongly agree responses which amounts to 49% and 17% stands on disagree, a
further affirmation that ICT has positively impacted accounting systems in
financial institutions. To this end, it is recommended that banks and financial
institutions at large should invest in ICT tools to boost and foster operations,
legislation established, enforced and customisation strictly controlled to avoid
customisation deficiencies.

v
 TABLE OF CONTENTS

DECLARATION ............................................................................................................................. i
CERTIFICATION .......................................................................................................................... ii
DEDICATION ............................................................................................................................... iii
ACKNOWLEDGEMENTS ........................................................................................................... iv
ABSTRACT .................................................................................................................................... v
TABLE OF CONTENTS ............................................................................................................... vi
LIST OF TABLES ....................................................................................................................... viii
LIST OF FIGURES ....................................................................................................................... ix
ABBREVIATIONS ........................................................................................................................ x
CHAPTER ONE ............................................................................................................................. 1
INTRODUCTION .......................................................................................................................... 1
1.1 BACKGROUND TO THE STUDY ......................................................................................... 1
CHAPTER TWO .......................................................................................................................... 13
LITERATURE REVIEW ............................................................................................................. 13
2.1 CONCEPTUAL FRAMEWORK ........................................................................................... 13
2.2 THEORETICAL FRAMEWORK .......................................................................................... 21
2.3 EMPIRICAL LITERATURE .............................................................................................. 29
CHAPTER THREE .................................................................................................................... 33
RESEARCH METHODOLOGY.................................................................................................. 33
3.1 INTRODUCTION .................................................................................................................. 33
3.2 THE AREA OF THE STUDY ................................................................................................ 33
3.2 SOURCES AND TYPES OF DATA ..................................................................................... 39
3.3 INSTRUMENTS OF DATA COLLECTION ........................................................................ 39
3.4 SAMPLE DESIGN AND SAMPLING PROCEDURE ......................................................... 40
3.5 INSTRUMENTS OF DATA ANALYSIS.............................................................................. 40
3.6 RELIABILITY OF RESEARCH INSTRUMENTS ............................................................... 40
3.8 LIMITATIONS OF THE INSTRUMENTS ........................................................................... 41
CHAPTER FOUR ......................................................................................................................... 42

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DATA PRESENTATION AND ANALYSIS .............................................................................. 42
4.1 CHARACTERISTICS OF RESPONDENTS ......................................................................... 42
4.2 PROBLEMS IN ICT AND ACCOUNTING SYSTEMS PERFORMANCE ........................ 51
4.3 RECOMMENDATIONS FOR THE INSTITUTION OF ICT-BASED ACCOUNTING
SYSTEMS..................................................................................................................................... 53
4.5 Hypothesis Testing.................................................................................................................. 56
CHAPTER FIVE .......................................................................................................................... 57
SUMMARY OF MAJOR FINDINGS, CONCLUSION AND RECOMMENDATIONS .......... 57
5.1 SUMMARY OF MAJOR FINDINGS ................................................................................... 57
5.2 CONCLUSION ....................................................................................................................... 58
5.3 RECOMMENDATIONS ........................................................................................................ 60
5.4 Suggestions for Further Research ........................................................................................... 62
REFERENCES ............................................................................................................................. 63

vii
 LIST OF TABLES
Table 4.1 Gender...........................................................................................................38
Table 4.2 Qualification of Respondents.............……...................................…………39
Table 4.3 Working Experience......................................................................................40
Table 4.4 Distribution by Departments.........................................................................42
Table 4.5 Appraisal of Accounting System...................................................................43
Table 4.6.1 Accounting System Design and Maintenance...............................................46
Table 4.6.2 System Application Areas and Customers Response....................................47
Table 4.6.3 System Performance......................................................................................49
Table 4.7.1 Impact of ICT Accounting System on Banks...............................................50
Table 4.7.2 Impact of ICT on Financial Institutions........................................................52

viii
 LIST OF FIGURES
Figure 2.1 Nature of Information Processor....................................................................14
Figure 2.2 Nature of Data Processor................................................................................16
Figure 4.1 Genders..........................................................................................................44
Figure 4.2 Respondents' Qualification............................................................................46
Figure 4.3 Respondents' Working Experience.................................................................48
Figure 4.4 Department of Respondents...........................................................................49
Figure 4.5 Appraisal of Accounting System....................................................................52

ix
 ABBREVIATIONS
ACCRONYM FULL MEANING

AIS Accounting Information System

APECAM The Banking and Credit/Finance Association
AS Accounting System
ATM Automated Teller Machines
BEAC Bank of Central African States
CEMAC Central African Economic Monetary Union
CFA African Franc Zone
CMM Capability Maturity Model
COBAC Central African Banking Commission
COBIT Control Objectives for Information and Related Technology
GAAP Generally Accepted Accounting Principles
IAS International Accounting Standards
ICT Information Communication Technology
IFRS International Financial Reporting Standards
ISO International Organisation for Standardisation
IT Information Technology
ITIL Information Technology Infrastructure Library
LAN Local Area Network
MINFI Ministry of Finance
NCC National Credit Council
NFC National Financial Credit
NGO Not for Profit Organisations
OHADA Organisation for the Harmonisation of Business Law in Africa
SA Public Limited Company
SYSTAC System de Telecompensations en Afrique Centrale
WAN Wide Area Network
WWW World Wide Web

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 CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND TO THE STUDY

Most, if not all companies apply accounting because it is generally accepted that
companies have to reveal certain financial and management information to the
owners, government and public users and of course because accounting is an
indispensable tool in the business decision-making process. Accounting Theory,
reveals that the accounting cycle includes steps such as journalizing the
transactions, posting them to ledger accounts, preparing trial balance, making
adjustment entries, preparing adjusted to end-of-period trial balance, preparing
financial statements and appropriate disclosures, journalizing and posting the
closing entries, and preparing after-closing trial balance at last. From the first look
it is not very difficult and it is so indeed, but when there are thousands or millions
of transactions, the situation dramatically changes. Lots of transactions that must
be processed in the accounting cycle make this process routine and even a little
mistake or inaccuracy can cause all the cycle from the very beginning in order to
find and correct the mistake.
Every transaction (event that change the financial resources or obligations of the
company) must be recognized, classified and documented; in addition, there must
be corresponding accounts identified and changed. The transactions are recorded in
appropriate journals (general journal, sales journal etc.) with transaction data,
affected accounts' titles, debit and credit of each affected account and explanation
specified in the journal record. The above procedure is used for each transaction.
All the journal records must be posted to the ledger on a periodic basis (daily or
weekly), which is a group of accounts put together and classified (assets, liabilities,

1
revenue, expenses and equity) --in other words general ledger summarizes all the
transactions within a period of time. In addition, there is a subsidiary ledger can be
used, which is a more detailed source, where individual items comprised
(inventory, accounts payable and accounts receivable). General ledger contains
controlling accounts which summarize the content of subsidiary ledger.
At the end of accounting period with the help of general ledger, there is a trial
balance calculated to make sure that debit and credit are in balance (if they are not
equal it means that there is an error somewhere). Then there must be appropriate
adjustments made like depreciation and income tax expenses, adjusted records
posted to the ledger and adjusted trial balance calculated. After this there are
financial statements should be prepared, which include balance sheet, income
statement, statement of retained earnings and statement of cash flows. Then journal
entries of temporary accounts are closed to permanent accounts and posted to the
ledger, and at last after-closing trial balance can prepared.
In order to stay on top, companies have to analyze the performance of all
organizational cells (starting from unskilled workers and operating personnel, and
finishing with top managers and other key personnel) and discover all the
deviations from the plan, their causes, and finally companies' management has to
take corresponding measures to avoid such deviations in the future. These are
captured in the end of period financial statements.
All of these procedures put together were formerly captured and processed by
employees. That is, before the bringing into being of information communication
technology, employees use to perform the entire accounting cycle manually. On a
periodic basis, they will calculate trial balances, journalize transactions, and
prepare financial statement reports and other routines. This takes much time,
resources and efforts in large organisations.

2
The cost in time, resources and efforts in manual accounting systems rapidly spear-
headed the transition into computerised and networked accounting systems,
thereby leaving today’s modern day business relying heavily on ICT solutions in
order to develop and grow (Asgarkhani and Young, 2010).
Nowadays, there are very few businesses which do not use a computer for at least
some of their data processing tasks. In some cases, this may simply involve the
accountant using a spreadsheet as an extended trial balance, the data being input
having been obtained, in the first place, from the manually maintained ledgers.
Once the final adjustments to the trial balance have been made, the spreadsheet
would then be used to produce the financial statements.
In other cases, computers may be used for most, or even all, of the accounting
tasks. Whatever the level of use of computers in accounting, accountants need to
be able to understand how data is being entered and processed so that they can
understand and have faith in the reliability of the figures produced. It has been
suggested, for example, that over 60 per cent of spreadsheet programs have errors.
This is something accountants need to guard against (Wood and Sangster, 2008).
Auditors have special computer programs designed to test the reliability of
computerised accounting systems but it is obviously better to ensure that the
computers are being used appropriately and correctly in the first place, rather than
relying on an auditor to discover that some aspect of the system is not operating
correctly – no one will, for example, wish to discover that for the previous year he
has been giving all his customers a 10 per cent cash discount, even when they have
not paid the amounts they owe! Thus, when computers are used in accounting, the
accountant involved needs to ensure that they are being used appropriately and that
the records they are creating and the output they produce is both valid and
meaningful.

3
1.2 STATEMENT OF THE PROBLEM
It seems that the use of Information and Communication Technology (ICT), by
large or small firms has been a challenge to some users and companies. It is
presume that growth within management accounting and Information system is
coming alive with the advent of Information and Communication Technology
(ICT), such as Enterprise Resource Planning (ERS) system, software and ancillary
equipment such as Automated Teller Machine (ATM), debit cards, electronic
commerce, computer hardware, database, internet, intranets, Extranet,
Telecommunication, Oracle, Structural Adjusted Program (SAP), Peachtree, Tax
Software(Turbo Tax) and Statistical Package for Social Sciences (SPSS).
Technological Advancements as well as the need to make the world a global
village has called for the implementation of ICT into many business processes.
Financial institutions of late have led the match into data and communication
system transformation. The increases in customer base as well as increase in
demand for more innovative products and services have necessitated the need for
ICT in the banking industries worldwide. In African countries however, banking
institutions have been subjected to so much criticisms for not providing their
customers with innovative and convenient banking services, with the results that
some customers especially businesswomen (“buyam sellams”), find it more
convenient keeping their savings at homes than in the banks (Safe and Andoh,
1990). These loops have pushed academic minds to the drawing board for a formal
enquiry into the situation with the aim of scientifically and objectively finding a
lasting solution to the problem.
The reasons to these are obvious. To begin with, the manual accounting
systems of the yesteryears have been a bitter pill to swallow to so many corporate
personnels. If not for the reason that the manual system was crude and exhaustive
to users, it has certainly been because it was time consuming and could not yield
4
readily available results. As a consequence therefore, accounting data could not be
timely provided for concrete managerial decisions to be built, particularly to meet
the ever increasing financial needs of bank customers who need liquidity more
often for effecting economic flows.
The introduction of modern ICT devices into this sector has been prompted by
the demerits of the manual accounting system. These include among other factors,
the fact that:
 There is speed inadequacy and time wastage; that is, recording transactions
manually take a long period of time, thereby making the execution rate
slower.
 There is arithmetic inaccuracy resulting from human weaknesses and fatigue
in manual transaction processing.
 Opportunities for Fraudulent recordings abound. With manual accounting
systems, fraudsters can easily misrepresent facts and go unnoticed for a long
period of time. Equally, recorded facts can easily be altered due to
inadequate methods of safeguarding manual accounting data or book.
 There are inadequate carrying and storage capacities in the manual
accounting systems. The record of transactions is more often restricted by
volume of books and documents required (and if not, then it is not feasible to
keep numerous books).
 Delays abound in the preparation of financial statements using the manual
system. Where such delays are overcome, manual presentations are not
always the best.
Alam and Noor (2009) confirmed that ICT offers enterprises improved efficiency
in business transactions. Fink and Disterer (2006) also advocate that ICT offers

5
many potential benefits to organizations so as to make them more efficient,
effective and competitive.
One stumbling obstacle to the emergence of African economies in the past has
been her backwardness in technology. Tracing its origin from the western
civilization, Africa can only but emulates technological practices from the western
nations. Due to this reliance, African economies in general and the Cameroonian
economy in particular tend to rely on the western world for technological transfer.
ICT transfer to our nation is a prey to this web. Inadequate capital, infrastructure,
personnel as well as the absence of the will, has left the ICT sector wanting.
Consequently, only a few persons afford training in modern ICT. The question of
competence still arises even among the few ICT trained persons, thereby, leaving
many with a questioning mentality. With this mentality, there is a general lack of
public trust in the few ICT users within the country. This is because the training
accorded these practitioners has been user-oriented, rather being design and
maintenance-oriented. The lack of this vital expertise among ICT practitioners has
left many people in different domains dissatisfied and disgruntled because of
unexpected break downs and multiple successive failures in these systems.
Since this study sets out to assess the effect of the introduction of ICT in
accounting systems in financial institutions, the study will not be complete unless
the following questions are given answers:
 Where are ICT tools applicable in financial institutions?
 Which types of Accounting Systems exist and are used in financial
institutions?
 Which ICT tools are put in place to augment the accounting systems in
financial institutions?
 Who are those charged with the design and institution of modern ICT tools
in accounting systems in financial institutions?
6
  Do the system designs and applications (ICT tools put in the accounting
systems in financial institutions) produce desired or intended results?
 How can ICT be instituted in the accounting Systems?
 Does the incorporation of ICT into accounting Systems in financial
institutions reduce fraudulent practices and boast accuracy and speed?
 Do they comply with the System of internal controls and audit put in by the
top executives to foster goal accomplishment?

1.3 RESEARCH OBJECTIVES.

ICT is presume to have affected accounting systems positively in so many ways,
research in these area have shown that ICT and its perceived importance due to its
usage across several groups of business firms, especially in the banking sector.
The main objective of this study is to investigate the role, impact or effect of
introducing and using ICT in accounting systems in financial institutions.
In an attempt to achieve the main objective of this work, this paper is set out to
accomplish the following specific objectives which all total up to the main
objective:
1) To determine how a sound ICT-based accounting system can be maintained
in financial institutions

2) To assess the limitations of the manual accounting system in financial

institutions.
3) To identify the problems associated with ICT and Accounting Information
Systems (AIS)
4) To make recommendations regarding the use of ICT in AIS in financial
institutions.

7
1.4 RESEARCH HYPOTHESIS.
This fact-finding mission is designed to test the following hypothesis;
Ho: Information and Communication Technology does not significantly improve
performance of accounting systems in financial institutions.
H1: Information and Communication Technology significantly improves
performance of accounting systems in financial institutions.
These hypotheses will be tested and accepted or rejected according to the
testing results
1.5 SIGNIFICANT OF THE STUDY.
This research is out to help the researcher objectively raise an opinion based
on his personal judgement and also express creatively his own personal ideas about
the credibility and relevance of ICT in accounting systems to top executives and
senior management staff of financial institutions.
It is also in partial fulfillment of the requirements for the award of a Bachelor of
Science (B.Sc.) Degree in Accountancy in the University of Buea.
This study is aimed at giving other prospective researchers in this domain, a
background for a more expansive and elaborate inquiry into the topic of ICT and
accounting systems in financial institutions in particular, and to stimulate and open
fresher avenues for further future queries into ICT and accounting systems in
general.
This work aims at providing managers, directors, and heads of institutions with
IT departments with reasonable assurance and guidelines on how they can institute
ICT in their accounting and reporting systems to better enhance credible, secured
and more appealing accounting statements presentation.
In addition, this study will help the government through its agent- the central
bank, to legislate and control the economy in the aspects of government monetary
policy regulation. The ease in control is feasible because all financial institutions
8
could link to interact and communicate through an IT application that connects
directly with the central bank, known as the SYSTAC (Système de
Telecompensation en Afrique Centrale).
Businessmen and potential investors are not side-lined. This study aims at
eliminating scepticism, reinstating confidence and assuring better service and
output quality to businessmen and potential investors. The states of frustration
which have always been experience in our financial institutions stand to witness
ceases if proper mechanisms are put in place for checks and balances in their
accounting systems.
To potential users and users of ICT-based accounting systems, this study will
guide and facilitate the putting in place of ICT in the different accounting systems
in financial Institutions and help other financial institutions to improve on their
already existing systems.
The study will also be of invaluable importance to fraud detection and
prevention agents in financial institutions. It will pave a way into a more logical,
sequential and less-time consuming findings. This is because in-built checks and
balances as well as greater data security can be assured.
In addition, auditors and the auditing profession in general will be saved much
stress and time wastages in the auditing process. By putting in place and
maintaining a good ICT system in the accounting process, transactions must be
appropriately authorised and verified against laid down criteria before they are
eventually validated. A well designed and sustainably maintained ICT-based
accounting system will thus save a great deal of the audit process time as many
processes which exist in the manual system will be rendered obsolete, if not,
eliminated.
Moreover, a good accounting system is bound to be fraud-free. A fraud-free
system is bound to be accurate and trust-worthy. Being trust-worthy will add value,
9
both to customers and all other stakeholders. Consequently, international
organizations and NGOs will be willing to extend their interest into the financing
and sponsorship of projects of human interest because of the assurance of good
stewardship which these financial institutions will stand to render. In effect
therefore, the will to serve humanity will be sustained as a result of proper
accountability.
To continue, commerce is finance! Fluent funds flow will mean great boom in
commercial activities. Acceleration in the availability of funds through the
speeding up of transaction treatment in financial institutions will boast commerce
and international trade. By putting In place measures to make financial transactions
rapid and less strenuous through information communication technology,
economic transactions (the buying and selling process) will be more rapid, leading
to higher turnovers and returns and hence, added values.
The strength of financial institutions in an economy also speaks for the
economy. The use of ICT in accounting system in financial institutions will
enormously facilitate the movement of the legal tender in the economy.
Consequently, availability of funds will ease economic investments and hence
foster economic growth and welfare.
This research will also help clients in financial intuitions in particular and the
entire public in general to rebuild and sustain trust in electronically generated
accounting reports and erase the mentality of “who designs, maintains and uses the
system?” especially given the inadequacy of ICT training infrastructures and
institutions in our country-Cameroon.
The research work can also help prospective job seekers in the financial
(banking) sector to know whether in order for them to gain employment and fit
into the industry, they should become computer literates or not.

10
1.6 SCOPE AND LIMITATION OF THE STUDY.
Due to the existence of so many binding constraints, an examination of the many
financial institutions in the nation will not be worthwhile. Notwithstanding, we feel
that a touch on two (2) reputable financial institutions will provide a reasonable
base for data collection, from which logical conclusions shall be drawn. We shall
in effect, limit the study to the National Financial Credit (NFC) Bank S.A Buea
branch and ECOBANK Cameroon S.A Buea Branch.
The efficiency of accounting system and the factors that affect the use of ICT
covers a wide aspect; ranging from profession, statutory and a host several factors,
but this work is restricted to cover the impact within accounting system in financial
institutions. The level of ICT investment by financial institutions obtained will
help our result to be generalized and practice. This study can also help in analyzing
ICT environment that govern the preparation, presentation of financial statement
and audit evidence. This study also serves as a guide for further research work on
the field of ICT impact.
1.7 STRUCTURE OF THE WORK.

Chapter one: This chapter comprises of the Introduction of the research work
which includes the Background of the study, background history, Statement of the
problem, Objective of the study, Hypothesis, Significance of the study, scope of
the study, limitations of the study, and structure of the study.

Chapter two: This chapter critically reviews related literature. It looks at the
introduction, the conceptual framework, the review of prior study (theoretical
review); in terms of the software, the impacts of ICT at various levels, and
empirical literature
Chapter three: Examine the Research methodology in terms of the introduction,
the research design, gives a background of the study area and describes the
11
methodology for the studies, including aspects of data collection and analysis
tools/instruments, as well as, their limitations.
Chapter four: Tries to see how the data are been analyzed which includes: the
Introduction, Data presentation, test of Hypothesis and the Summary of findings.
Chapter five: This is the Summary and conclusion of the research work. It looks
at the recommendations, Suggestion for further research and the Reference.

12
 CHAPTER TWO

LITERATURE REVIEW

2.1 CONCEPTUAL FRAMEWORK

Under the conceptual framework, it will be important to look at definitions of some
key terms such as data, data processing, word processing, systems and system
types, information and information systems, the OHADA accounting system,
communication, technology and information communication technology.
Data are nothing but facts (organized or unorganized) which can be converted into
other forms to make it useful, clear and practically used. This process of converting
facts to information is processing. Practically all naturally occurring processes can
be viewed as examples of data processing systems.
Data processing is any process that a computer program does to enter data and
summarise, analyses or otherwise convert data into usable information. The
process may be automated and run on a computer. It involves recording, analysing,
sorting, summarising, calculating, disseminating and storing data. Because data are
most useful when well-presented and actually informative, data-processing systems
are often referred to as information systems. A typical system of information
processing can be seen in the diagrams below.
Figure 2.1 Nature of an Information Processor

Source: Wikipedia.com, March 2013.

13
Romney and Steinbart (2008), define Information as data that have been organised
and processed to provide meaning to a user. According to these scholars, more
information and better information translates into better decisions.
Communication on the other hand, is any mode or medium through which a
thought (information) can be translated or transmitted from one party to another
and a response or feedback gotten in effect.
Technology embodies the use of simple or sophisticated tools to create maintain
and improve upon the manner of doing things such as machines, computer
softwares, electronic devices, computers, just to list but these.
All put together, Information Communication Technology (ICT) can be defined as
technologies that enable recording, processing, retrieving and the transmission of
information or data. Herselman and Hay (2003), describe ICT as technologies that
support the communication and co-operation of “human beings and their
organizations” and the “creation and exchange of knowledge. Furthermore, Yu
(2010) considers ICT as a range of technologies that allow the gathering,
exchange, retrieval, processing, analysis and transmission of information. In order
words, ICT can be described as any tool that facilitates communication, process
and transmit information and share knowledge through electronic means.
Rwashana and Williams (2006) advocate that ICT encompasses a range of
electronic digital and analogue devices such as radio, television, telephones (fixed
and mobile), computers, electronic-based media such as digital text and audio-
video recording, and the internet, but excludes the non-electronic technologies.
Selwyn (2002) refers to ICT as “an umbrella term that includes computer hardware
and software; digital broadcast and telecommunications technologies as well as
electronic information repositories such as the World Wide Web or those found on
CD-ROMs”. Ssewanyana (2009) further describes ICT as a strategic tool that
allows users to become more efficient and effective.
14
Systems theory views the world as a complex system of interconnected parts. A
system is scoped by defining its boundary; that is, choosing which entities are
inside the system and which are outside – part of the environment.
A system is a set of interrelated components which interact in order to achieve a
common goal. For purposes of ease of action, systems are further split into sub-
systems to enhance maximum achievement of the goals of each unit as shown in
the following diagram. There are basically two major types of systems; the natural
system and the artificial or man-made system.
Figure 2.1: Nature of a Data Processor

Source: Wikipedia.com, March 2013.

Natural systems are those which occur without any human intervention.
Knowledge of natural systems is principally got from discoveries. They abound in
existence and are not at all the results of the human endeavours. Some major
examples of natural systems include rivers, mountains, minerals, to list but these.
Artificial or ‘Man-made’ systems are those systems which exist purely as a result
of human endeavours. In other words, they are constructed systems. Examples here
will include dams, roads, machines, canals, among many others.
An accounting system is an artificial system, which is any system which identifies,
assembles, classifies, analyses, records and reports an entity’s transactions and
maintains accountability for related assets. To build a reliable accounting system,
all such details as adequate separation of duties, proper authorisation of

15
transactions and activities, adequate documents and records, physical controls over
assets and records, independent checks on performance, all inherent in an internal
control system must be duly instituted.
The OHADA accounting system is statutorily required to be implemented in all
business undertakings within the OHADA member states. It is a carefully designed
system of accounting built on the Generally Accepted Accounting Principles
(GAAPs), the International Financial Reporting Standards (IFRS) and International
Accounting Standards (IAS), but with a main difference in manner of accounts
presentations being the use of numeric codes for each class of accounts. Cameroon
is a founding member state of the OHADA and consequently, all business entities
within Cameroon (worthy of note the financial institutions) are obliged to produce
their accounts and end of period financial statements and reports following the
OHADA Accounting framework specifications.
An Accounting Information System (AIS) is that system which collects, records,
stores and processes data to produce information for decision makers and other
information users and stakeholders. It may involve the use of technology or be
manually done; that is done using a simple paper-and-pencil approach. It engulfs
the entire accounting system as a subset. Most if not all of the financial institutions
within Cameroon make use of special banking software packages that have been
built to capture, process and emit information in the form of financial statements
and other management reports. These soft ware packages have been inherently
constructed with the basic requirements of the OHADA accounting system,
otherwise, they allow for customisation to desired modules in an effort to meet the
OHADA requirements. Vibrant banks within the banking industry today make use
of the FLEXCUBE banking software application, a product of eProcess, a leader
in the design of IT Platforms.

16
System Controls are a very vital component of every accounting system. Computer
processing may reduce clerical errors but increase risks of unauthorized access or
modification of data files. One of the primary objectives of AIS is to control a
business organisation. It therefore becomes inevitable for accountants to help by
designing effective control systems and auditing, or reviewing control systems
already in place to ensure their effectiveness. It is expected that accountants in an
AIS take a proactive approach to eliminating system threats; and in detecting,
correcting, and recovering from threats when they do occur. These system control
agents should be members of the team that builds the accounting system, since it is
much easier to establish control procedures during system inception (the initial
stage) than to add them after the fact.
In summary therefore, an AIS control should embody the whole system of Internal
controls; that is, the process implemented by the board of directors, management,
and those under their direction to provide reasonable assurance that the following
control objectives are achieved:
 Assets (including data) are safeguarded.
 Records are maintained in sufficient detail to accurately and fairly reflect
company assets.
 Accurate and reliable information is provided.
 There is reasonable assurance that financial reports are prepared in
accordance with GAAP.
 Operational efficiency is promoted and improved.
 Adherence to prescribed managerial policies is encouraged.
 The organisation complies with applicable laws and regulations.
There should in effect be both general controls and application controls which will
prevent, detect, and correct transaction errors and fraud and be concerned with

17
accuracy, completeness, validity, and authorization of the data captured, entered
into the system, processed, stored, transmitted to other systems, and reported.
A Financial institution is any institution that renders monetary services to her
customers. A bank constitutes a good example and can be defined as a financial
institution that accepts deposits and channels those deposits into lending activities.
Banks primarily provide financial services to customers while enriching investors.
Banks are important players in financial markets and offer services such as
investment funds and loans.
To provide fast and effective services to customers and render account to
stakeholders, financial institutions make use of information technology in the form
of computer softwares which include;
User-Friendly Software
Basic accounting softwares demand not only skills but also thorough accounting
knowledge. By contrast, current softwares can be run with only a simple
understanding of the accounting practice. Nowadays, with in depth help menus and
also the vast information that can be sourced online free of charge, resources to
assist users in their use of accounting softwares are ease to come by. (ICT in
Accounting, Simmons, Hardy 2011, 372)
The Growth of E- Commerce
The advancement in technology especially the internet has generated new methods
of communicating with customers both current and potential in the banking world.
E-Commerce has not only changed the way businesses specifically banks market
their products or services, but also how these products are normally delivered,
knack of computers is highly significant in this direction. (ICT in Accounting,
Simmons, Hardy 2011, 372).

18
Account Receivable Software
The account receivable must consist of a detailed listing of customers and the
amounts of money each owes the company or bank and other information like the
date the debt was incurred, address and phone numbers of each customer.
Businesses considering the installation of account receivable management software
must undertake an extensive research into the available alternative solution to
ensure it includes the key potentials that would enable accuracy and integrity of its
financial reporting. The right accounts receivable software solution updates the
ledger accounts with appropriate transactions automatically. Invoices are added
and customer payments in regards to outstanding invoices are also deducted. The
software checks that payments have been applied to a specific invoice or identify
that it covers multiple invoices. There should be regular reports generated in
detailed, such as an account receivable aged listing so that customers at risk of
defaulting could easily be identified. (Accounting Software, Quoted: 25.05.2012).
Accounts Payable Software
The company or organisation considering the implementation of account payable
software solution must first of all realise that the best ones are the ones that provide
a rapid return on investment. The main characteristics of account payable that
increase the payback include early payment awareness that enable the company to
make use of discounts offered. More so, the ability to write cheques to suppliers
and to have the correct debits and credits applied to the company account makes
balancing the books easy. (Accounting Software, Quoted, 25.05.2012)
General Ledger Software
A ledger account refers to an accounting record that summarises all transactions
affecting each individual item such as bank, stock, creditors, vehicles or capital. In
the financial statement all items have its own ledger account and so in this case the
bank can have so many ledger accounts to manage considering its numerous
19
customers, without computerised accounting system, it would be virtually
impossible to locate one ledger account out of hundreds accurately and
conveniently. (ICT in Accounting, Simmons, Hardy 2011, 372). The general ledger
software is a very important software solution for all businesses since it is the main
accounting record of the business. Key features companies to look for in general
ledger accounting software are its ability to trace budget and financial data so as to
produce accurate financial statements, detecting fraud so easily, tracking budget
and financial data to produce accurate financial statements that can bring out better
income statement, balance sheet, and ledger reportage. When the best general
ledger software is chosen, it helps to develop year- end reports and statements
quickly and accurately. The general ledger software automatically passes data from
subsidiary ledgers such as accounts payable and account receivable for quick and
accurate double entries as well as balance sheet update. (Accounting Software,
Quoted: 25.05.2012).
Accounting Packages and Chart of Account.
A number of software packages have been developed to assist in the accounting
field and some of such packages are QuickBooks, FLEXCUBE, Cash Flow
Manager, Attaché, Econet and Termenos T24. Even though some of these
softwares mentioned here are developed for small business, they are designed
especially for accounting purposes in the banks, especially the Termenos T24 and
the FLEXCUBE software which are currently in use by ECOBANK S.A and NFC
Bank S.A Cameroon. It functions in such a that once a customer’s data is entered,
the accounting records of that particular customer are updated automatically and
also customer’s reports pop- up so easily. Links between the bank and its staff, as
well as other information are easily accessible and can be produce d quickly,
accurately and efficiently. These accounting packages that have been outlined here
earlier bring out transactions using accounting records such as the general ledger
20
accounts (ICT in Accounting, Simmons, Hardy 2011, 372). Furthermore, if some
of the customers have the same names or similar names, it may be very difficult to
identify which account they belong to. To tackle these issues, a bank or business
can use a chart of Accounts to arrange its ledger accounts. A chart of accounts is a
catalogue of all the accounts which detects and organises each ledger account
individually by assigning to it an account number or code. This is common with
the OHADA accounting system. (ICT in Accounting, Simmons, Hardy 2011, 373)
2.2 THEORETICAL FRAMEWORK
Accounting Systems in the banking industry have gone through a lot of
transformation with the introduction of ICT, and this have changed the processes
and activities such as book keeping, retrieval of customers’ information, keeping of
records of customers, deposit and withdrawal, and cheque processing. (Marilyn
1986). For a methodical touch on literature, ICT-related theories are looked at on
one hand and those of IAS on the other.
The use of ICT is widespread and regarded as an essential tool for the efficient
administration of any organization and in the delivery of services to clients.
Schware (2003), states that ICTs are being integrated into procedures, structures,
and products throughout businesses, governments, and communities.
The use of ICT increases the supply of information as ICT plays a key role in
information sharing and dissemination. According to Spanos et al. (2002), ICT
removes distance and time constraint in accessing required information flows. ICT
also reduces the cost of production as knowledge is produced, transmitted,
accessed and shared at the minimum cost. There is a reduction in the degree of
inefficiencies and uncertainty with the use of ICT because it enables businesses to
interact more efficiently (Buhalis, 2003).

21
Shanker (2008) ascertains that the use of ICT in many organizations has assisted in
reducing transactional cost, overcome the constraints of distance and have cut
across geographic boundaries thereby assisting to improve coordination of
activities within organisational boundaries.
ICT has also led to more transparency in organizations since it enables networking
and information sharing that leads to demands for greater openness and
transparency (Shanker, 2008; Kollberg and Dreyer, 2006). Jiménez-Zarco et al.
(2006) further argue that ICT plays an important role in acquiring, creating and
managing knowledge as it enables the diffusion of organisational data that can be
crucial for effective decision making and control at all levels. Likewise, ICT helps
in organizational planning and improves organizational communication and
flexibility.
The application of computer networks (WAN, LAN, Internet etc.) is a vital part of
ICT enabled system, which is especially true in the case of banks with a branch
network. Networks are among other things used by banks to facilitate collaboration
across functions, to advance productivity and efficiency by supporting business
operations and decision making across the inter-networked enterprise. (Marilyn
1986).
In the Central African Economic and Monetary Union (CEMAC) zone, the Bank
of Central African States (BEAC) took hold initiative to integrate ICT into its
payment systems development strategy. This strategy constitutes the Système de
Telecompensation en Afrique Centrale (SYSTAC) and is aimed at providing a
framework for electronic delivery of financial services to every segment of the
economy. The objective of this project was to deepen financial intermediaries by
developing electronic payment products that will meet the needs of the “Banked”,
‘Unbanked”, and “Under banked”. BEAC has also put in place another system of

22
network purposely for transacting very huge sums at very rapid speed- the
SYGMA.
ICT (information and communications technology - or technologies) is an umbrella
term that includes any communication device or application, encompassing: radio,
television, cellular phones, computer and network hardware and software, satellite
systems and so on, as well as the various services and applications associated with
them, such as videoconferencing and distance learning. ICTs are often spoken of in
a particular context, such as ICTs in banking, education, health care, or libraries
(Beck et al 2000).
According to the European Commission, the importance of ICT lies less in the
technology itself than in its ability to create greater access to information and
communication in underserved populations. Many countries around the world have
established organizations for the promotion of ICTs, because it is feared that unless
less technologically advanced areas have a chance to catch up, the increasing
technological advances in developed nations will only serve to exacerbate the
already-existing economic gap between technological “have” and “have not” areas
(Levine, 2003).
Fortunately, the technology has caught up with Cameroon, Information and
Communication Technology (ICT) is of late becoming a household name. We are
always collecting data, consciously and sometimes unconsciously. The names,
addresses, and telephone numbers of customers; items in stock, items purchased;
marks scored in assignments and examination, number of students in the
university, the number and classification of books in a library among others, are
examples of data that is collected by various establishments.
Moreover, these pose a lot of problems for organizations in terms of storage,
access, analysis, and presentation. Analysis is critical in that it reduces data to
information which intend aid decision making process. A collection of two
23
hundred sets of marks is part of data. If this is analyzed properly it will generate
averages and other statistical information from it. If the end results obtained from
the analysis is poor performance, management will investigate to establish the
cause of the poor performance and corrective measures are implemented.
The use of Information and Communication Technology (ICT) helps in the
efficient management and execution of transaction since it could be designed to
suit one’s operations. The success of Information and Communication Technology
(ICT) is not the technology per se, but the ability to manage it well. The view of
Caruse (2003) is the implementation of security policy to safeguard the IT
infrastructure.
According to the International Society for Technological Advancement in Banking
(1998) a number of banks are in their latest move in a decade of banking industrial
cataclysm, brought about by enormous advance in IT, due to the ambitious
advancement in information technology. This development has affected nearly all
aspects of the banking industry.
The improvement in Information and Communication Technology (ICT) has
enhanced the creation of new business models and has revolutionised the
distribution channels of financial system resulting in not only a reduction in the
transaction costs but also has improved the convenience and accessibility for the
customer. (Curtain, 1998)
In the management of Information and Communication Technology (ICT), many
tools have been developed, including the use of different best practices presented
in frameworks such as Information Technology Infrastructure Library (ITIL),
Control Objectives for Information and Related Technology (COBIT), Capability
Maturity Model (CMM) and International Organization for Standardisation (ISO)
17799. These four frameworks are some of the different frameworks that
incorporate useful best practices used in managing ICT infrastructure in different
24
business sectors including the banking-sector accounting systems, which is the
focus of this research (Rousseau and Wachtel, 1998).
On the part of AISs, an optimal use of AIS in an organisation will bring about
better adaptation to a changing environment, better management of arm's length
transactions and a high degree of competitiveness. It will also bring about a boost
to the dynamic nature of firms with a greater flow of information between different
staff levels and the possibility of new business on the network and improved
external relationships for the firm, mainly with foreign customers accessed through
the firm’s web (Elena Urquia Grande, Raquel Perez Estebanez and Clara Munoz
Colomina, 2010).
For the first time in 1966, the American Institute of Certified Public Accountants
(AICPA) stated that: “Accounting actually is information system and if we be
more precise, accounting is the practice of general theories of information in the
field of effective economic activities and consists of a major part of the
information which is presented in the quantitative form”.
In the above definition, accounting is a part of a general information system of an
economic entity. Boochholdt (1999) defines accounting information systems as
systems that operate functions of data gathering, processing, categorizing and
reporting financial events with the aim of providing relevant information for the
purpose of score keeping, attention directing and decision-making.
Before the month of January 1998, when the OHADA Treaty became enforced in
the Cameroonian business environment, banks were formerly under the directory
and legislation of Conventions, Laws, Ordinances, Presidential Decrees,
Ministerial Orders and Circulars that govern Banking in Cameroon. The most
recent harmonised legislation that governs business activities, (banking inclusive)
in the CFA Zone is the OHADA Treaty which actually came into place in January

25
1998 and supersedes all previously existing laws (Nico Halle & Co. Law Firm;
2005).
The main regulatory bodies of the banking system in Cameroon include COBAC
(The Banking Commission for the six Central African member States), MINFI
(The Ministry Finance), NCC (The National Credit Council), BEAC (The Bank of
Central African States) and APECAM (The Banking and Credit/Finance
Association). Although these institutions remain the main bodies charged with the
regulation of Cameroon Banks’ activities, the supervisory powers rest with the
MINFI and COBAC (Nico Halle & Co. Law Firm; 2005).
The OHADA Uniform Acts on Accounting Law (Articles 1, 2, 3, 4, 7 and 8), lay
down a harmonised accounting system for companies located in the Member
States, setting out comprehensive provisions for accounting organisation, the
obligation to present annual accounts, rules for the evaluation and determination of
net income, auditing, publication of accounting information, consolidated accounts
and criminal penalties. This law actually came into force on 1st January 2001 for
non-consolidated entities, and on the 1st January 2002 for consolidated entities.
Article 11 of the Uniform Acts on Accounting Law, as well, requires all companies
to present annual financial statements (a balance sheet, a statement of profit and
loss, a financial table showing the sources and uses of funds and an annex
indicating any facts that are not apparent in the other financial documents and that
may have a significant bearing on the assets, the financial situation or the financial
results of the company) and keep accounts following the ordinary system, except in
such cases where the turnover is not within the specified range. The financial year
must also coincide with the calendar year, except where the entity is within its first
year of trading. It is thus fundamental for every financial institution designing an
AIS to incorporate all the legal elements required by the OHADA Statute.

26
Several studies carried out have asserted that AIS plays a proactive role in strategy
management, acting as a mechanism that enables organisational strategy (Chenhall,
2003; Gerdin and Greve, 2004). To this end therefore, a poor AIS put in place by
any financial institution will not only impede its management operations, but will
also frustrate other direct information users and stakeholders in their choices of
decisions. Organisational performance is thus a function of the financial
performance, relayed by the AIS and its inherent and associated components and
tools (ICT). Fitness will exist in the combination of ICT and ASs that contribute to
solid Accounting Information Systems and hence proper performance in financial
institutions.
Nothing has indeed, really impacted accounting more extensively than the growing
use of computerised accounting software in these recent years. Innovative
technology concepts like Electronic Fund Transfer, Electronic Data Interchange,
Point of Sales, Radio Frequency Identification devices, Enterprise Resource
Planning systems, and others, have definitely changed the way that the accounting
information is gathered, processed and reported. Nowadays, thanks to the above
technologies, the role of the accountants is transformed from simple bookkeepers
who were used to capturing and processing data, to participative and important
decision-makers, thereby, leaving the routine and repetitive tasks to computers.
Accountants can thus, focus in analyzing information and playing a crucial roles in
the decision-making arena of their companies.
A computerised accounting system can be referred to as an accounting information
system that processes the financial transactions and event to produce accurate
accounting results as per the user’s requirements or guidelines. Every proper
accounting system, be manual or computerised must follow the Generally
Accepted Accounting Principles (GAAP) and also the framework for maintenance
of records and generation of reports must be will defined and easy to understand.
27
In a computerised accounting system, the process of storage consist of computer
hardware and software under which the accounting which the accounting operates.
Computer hardware and software interdependent and so one cannot do without the
other. The link here is that, the type of accounting system employed determines the
operating environment. More so, the nature of software used determines its
hardware so selecting computer hardware depends upon several factors like the
number of users, secrecy level and the sectional or department activities in the
bank etc. (Computerized Accounting Software, chapter 13, 492). A computerised
accounting system also involves the user of computer hardware and software to
perform the recording and reporting functions that would otherwise have been
done manually by staff of a bank or an owner of a business. Prior to technological
advancement, accounting records were being kept only on a manual basis whereby
the bookkeeper needed to complete a manual basis document for each sale or
receipt, and then spend all day or better still a week in writing the records of the
day or week into special journals, stock cards, as well as debtors and creditors
records. This clearly took some time, time that would otherwise have been spent in
managing the business. More importantly, completing the accounting records were
sometimes seen as a hurdle to business, rather than a way of making it more
possible and profitable. (ICT in Accounting, Simmons, Hardy 2011, 372).
However, the development of computerised accounting systems has the way small
business keep their accounting records. This has permitted small business owners
to simplify the accounting processes, thus leaving them more time to work on their
main business. (ICT in Accounting, Simmons, and Hardy 2911, 372) the ever-
changing global competitiveness in the service provided by banks has however,
increased the volume of activities banks perform. This has been made possible
through the use of computerised accounting softwares which has softened the more
tedious banking functions through the use of manual banking system. In
28
Cameroon, development in information technology (ICT) is drastically changing
the way businesses are being organized. Banking institutions coupled with other
sections of the financial service industry, continue to face pressure from the
considerable change in the regional and global financial meltdown. The onus
(responsibility) to transform successfully rest on the technology and operations
side of the banks, which must be ready at all, times to step up and face the task.
2.3 EMPIRICAL LITERATURE
Studies carried out to assess the impact of ICT an accounting systems in financial
institutions are rare. The absence or inadequacy of such scholarly works lessens the
scope of empirical comparisons and reviews. The few observations found however,
share these views.
Barua (1995), and Stratopounlos (2000), hold the view that the introduction of
Information and Communication Technology (ICT) has brought a lot of benefits to
banks and has also boosted the performances of businesses.
Different investigations in this theme have borne different results. Some
researchers assert a positive impact of ICT use on business performance;
meanwhile researchers like Strassmann, (1990) and Yosri, (1992) consider it
insignificant, while others assume a negative impact (Brynojolfsson, 1995;
Holland, 1997; Setzekorn, 1998).
Looking at the topic from the perception of accounting systems, existing literature
offers scant evidence of the relationship between these AIS and financial
performance; though it is important to highlight the study made by Elena Urquia
Grande, Raquel Perez Estebanez and Clara MunozColomina (2010) which
discovered a positive association between AIS design and organizational strategy
and performance. The successful implementation of AIS could save shareholder’s
money and time. The information value generated by AIS to shareholders and
stakeholders in making investment decisions (Zulkarnain Muhamad Sori, 2009).
29
Financial managers need the financial and accounting data provided by AIS to
evaluate the firm’s past performance and to map future plans. Therefore, the
organisational performance is measured in terms of ROA (Return on Assets) and
ROE (Return on Equity) these ratios are financial performance measuring ratios
(Sadia Majeed, 2011). Return on equity is a key to provide useful information
about the performance of debt in the capital structure that the general manager
must try to influence in order to improve financial performance (Alan Miller et al,
2001).
In any case, it is still not clear which factors influenced or determined this
contribution (Weill, 1992; Mukhopadlyay, 1996). Thus, it is crucial to discover the
impact of ICT on accounting systems and to improve the business performance
through ICT leverage in Financial Institutions with special emphasis on two
commercial banks in order to make ICT “a good servant rather than a bad master”.
Although the studies so far carried out assert impacts either between ICT and the
performance of financial institutions, ICT and organisational strategy or AIS,
organisational strategy and performance, little or nothing has been mentioned
about ICT and the performance of accounting systems. Any study on the impact of
ICT on any organisational aspect without a look at the accounting system in place
is certainly incomplete as the accounting system embodies the powerhouse of
every organisation. The accounting system furnishes most of required business
appraisal information and hence deserves due consideration when examining the
role of ICT in every concern. Thus, a complete view on the impact of ICT on any
organisational aspect should inherently include the accounting system as its
contributions to the success of every aspect in an organisation are but numerous.
Advancement in technology and globalisation has brought a very rife competition
within the banking industry in Cameroon. The desire for offshore investment
opportunities that are being triggered by less stringent regulations in than financial
30
sector couple with regional economic integration have compelled most local banks
in Cameroon to modernised. NFC Bank modernised its operations by moving from
the traditional banking system known to all Cameroonians or customers, that is the
manual banking system to a more robust way of banking, the computerised
banking system. The introduction of some products and services could not have
been necessitated without the use of information and communication technology,
international money transfer system, microfinance loans, Apex link money
transfer, Apex trans and processing of salaries have all been successfully
implemented because of this technology. Cameroon as at September 2012 was
estimated to have little over 1.5 million accounts holders in the various banks out
of a total population of closed to 24 million ( a ratio of 6.25%) compared to
Nigeria’s 23 million bank accounts holders among a population of 140 (more than
16%). This shows the vast investment opportunity that is yet to be harnessed
within the financial sector in the country. Foreign banks that emerged after the
liberalisation of the financial sector over the last few years predominantly
dominate the financial market. This influx of foreign banks in Cameroon has
brought about technology, products innovations and different modalities of
banking into the banking system in Cameroon. In fact products and services like
Mobile banking, automated payments systems and offices, telephone banking
(SMS), prestige and premium banking could not have been necessitated without
these foreign banks which brought high le4vel of competition into the banking
system.
Manual can be referred to as anything physically done or operated by the hand.
Manual as defined by Dictionary.com refers to anything that is ‘done, operated,
worked, etc, by the hand or hands rather than by an electronical or electronic
device’ (Dictionary.com quoted: 12.03.2013)

31
This concept when applied to banking can be described as the process whereby the
mainframe activities of the bank such as customers, management and accounting
information are received and recorded by handwriting without computerised or
supported devices. With manual banking, all information about a customer
including opening of an account, cash and cheque deposits as well as withdrawals
not to talk of information on the ledgers, mortgage, overdraft and other credit
agreements including international banking service are processed by handwriting.
A journal written by Boye S.S titled Innovative banking activities in Ghana (1990)
indicated that in any industry with which the banking industry is of no exception,
there is the need to create innovative services and products to respond to the
varying consumer demographics and their lifestyles. The intense competition
among Cameroonian banks calls for regular overhaul of the banking activities or
services in order to guarantee customers with quick but efficient service delivery.
Moreover, due to the high level of competition that exist in the banking sector in
world, it is apt to the financial sector in Cameroon to accept the need and benefits
of regularly replacing old products with new or modified ones in order to enhance
their performance. An enhanced service through computerised accounting system
can serve as a very strong marketing tool for banks by attracting customers from
outside and within the sphere of the existing markets. Financial institutions in
Cameroon realised that computerization of the accounting system could lead to
reduction in cost such as salaries, higher returns by participating in international
banking services and an improved security system which reduces fraud.

32
 CHAPTER THREE

RESEARCH METHODOLOGY

3.1 INTRODUCTION
This research focuses on how and why aspects of the relationship between ICT and
Accounting Systems in financial institutions (the impact of ICT on Accounting
Systems in financial institutions). It is out to present an overall view of how
financial institutions benefit from the use of Information Communication
Technology in capturing and reporting financial information. Case study research
is one of the most common approaches applied in the field of Information Systems
(IS) (Alavi et al., 2001). Sauer (2003) asserts that research in information systems
is best done by case study. Myers (2008) further argues that the case study
approach is well-suited to IS research as it helps to study the use of technologies in
organisations. Yin (2003) advocates that case study method provides an
opportunity to study a phenomenon within its natural context. As a result, this
study employs a case study research method based on two financial institutions
that have not only successfully adopted ICT, but effectively utilises ICT in their
operational processes. The case study method is deemed appropriate since the aim
of this study is to broaden our understanding on the impact of ICT on accounting
systems in financial institutions. The study would be localised at the National
Financial Credit (NFC) Bank Buea branch and Ecobank Cameroon Buea branch.

3.2 THE AREA OF THE STUDY

This study will be localised at two commercial banks currently operating within
the Cameroon financial sector, have amassed years of working experience and
have incorporated technology into various subsystems and systems of their
operations over time, with a dynamic sense of the innovated changes in taste and

33
fashion of technological appliances. NFC Bank S.A and ECOBANK S.A both
located in Buea, South West Region of Cameroon are selected cases examined.

3.2.1 National Financial Credit (NFC) Bank S.A

The National Financial Credit Bank S.A is an offspring of the initiative of a group
of dynamic young Cameroonians with a private sector orientation who got inspired
in 1989 to create a private financial institution following the aspirations of many
Cameroonians and the liberalisation of the business sector in line with the
Structural Adjustment Program of the government. The initiative resulted in the
creation of the “National Financial Credit Company (NFCC)”; which was
registered with the National Credit Council (NCC) on December 20th, 1989. It had
its legal Head Quarters in Bamenda and the administrative headquarters in
Yaoundé at Avenue Charles De Gaulle. The administrative head quarters located in
Yaounde became the first branch.
The baby financial institution started its activities on June 15th, 1990, with a capital
of 10 million FCFA, thanks to the efforts of its founders and a ministerial order
which granted permission for the financial institution to operate. This capital size
was later increased to 318 million FCFA following COBAC’s regulations of 1993.
The financial institution witnessed a series of significant improvements within a
very short time of her operations and gained the statute of a full flesh commercial
bank on August 9th, 2006 from the authorities following a seminar approved by
COBAC to join Afriland First Bank and Commercial Bank of Cameroon as the
only indigenous banks in Cameroon. The change in the statute led to a change in
the name of this financial house from the National Financial Credit Company
(NFCC) to the National Financial Credit (NFC) Bank S.A. Like other banks in
Cameroon, her operations are constantly monitored by authorities such as COBAC,
MINFI, NCC, APECAM, and BEAC inspectors.
34
NFC Bank is a public limited company (Plc/S.A) owned by a group of
shareholders under the supervision of a Board of Directors. The management of the
bank is supported by seven directorates including the directorates of Finance,
Human Resource and Logistics, Marketing and Communication, Operations, Audit
and Internal Controls, Information Technology, and Credit. The bank now boasts
of a capital size of about 5,285.62 million FCFA, currently has 13 branches in the
country spread over the Centre, the Littoral, the North West and the South West
Regions. The branches are found in major towns like Yaounde (Carrefour Warda,
Mvog Ada and Hipporome); Douala (Bonanjo and Bonaberi); Bamenda
(Commercial Avenue and Nkwen); Kumba (Commonwealth Avenue); Muyuka
(Market Junction); Mamfe (Small Mamfe) and Buea (Molyko).

The bank also has more than 720,000 accounts with more than 20 billion FCFA in
customers’ savings accounts and with personnel strength of about 400. The bank
presently has a balance sheet size of about 64 billion francs, over 41000 customers
and 69000 accounts operated and is in serious competition with tough local and
international banks like Société Générale des Banques au Cameroun (SGBC);
Standard Chartered Bank of Cameroon (SCBC); SCB - Crédit Lyonnais du
Cameroun (SCB-CL); Banque Atlantique; ECOBANK; Afriland First Bank;
CITIBANK; Commercial Bank of Cameroon (CBC); Union Bank of Cameroon
(UBC); and Banque International du Cameroun pour l’Epargne et le Crédit
(BICEC). In addition, the bank has foreign corresponding banks like the Standard
Chartered Bank London, Standard Chartered Bank Frankfurt, the Bank of China,
Afriland First Bank and FIMBANK Malta.
NFC Bank offers a wide range of income-generating products and services. The
main products offered by the bank include savings accounts which could take the
form of a normal savings account, a micro-save account, accounts for schools,

35
churches, associations, NGOs, small financial institutions and credit unions,
embassies, to list but these; current accounts including salary accounts for both
state employees and employees of private corporations, business accounts for
moral persons; loans including short medium and long term loans; and bank
overdraft such as spot and permanent overdraft in the form of salary advances. On
the other hand, the renders services to her customers such as the payment of
salaries, local money transfer operations, international money transfer operations,
Western Union operations, standing orders, bank guarantees and the discounting of
bills. As a result, the raises a great deal of her revenue from but not limited to the
sale of shares, from various account operated by customers, from interbank
transactions, from the various types of loans granted, from international transfers
and from her various investments.
Following the bank’s ambition of becoming the fifth largest bank in Cameroon and
a model for African bank by adding values to both her customers and shareholders
as spelt out in her mission statement, the bank introduced a tough real-time on-line
banking software package - FLEXCUBE in her operations in April 2012 to replace
a previously existing DELTA software package. This software package allows
customers to carry out transactions with the bank in their different accounts,
irrespective of where they are or where their mother branches are located. Thus
with this application package, the bank is one and the bank’s branches are just a
means of moving the bank’s products and services closest to the customers and
prospective customers; that is decentralising the bank.
NFC Bank S.A Buea branch is a unit of this banking network and has been in
existence since the early 90s. She accounts for a good number of the entire body of
customers which the bank has. This branch is under the supervision of a branch
manager who serves as a liaison between the branch and the head office on all
matters affecting the bank. This branch has staff strength of eight direct staff and
36
five auxiliary staff. The whole portfolio of products and services offered by NFC
Bank are marketed at this branch.

3.1.2 Ecobank Cameroun (EBC) S.A

Ecobank Cameroun (EBC) S.A is a subsidiary of a Pan-African multinational,
Ecobank Transnational Incorporated (ETI). The group started trading in Cameroon
in the year2001. It presently has about forty seven (47) subsidiaries in different
countries across the African continent and France. EBC has twenty seven (27)
branches carrying out commercial activities within the Cameroon economy.
Ecobank Buea Branch, is located at the university of Buea junction, mile 17 and a
standing ATM machine in the university campus of Buea
The Ecobank Group (ETI) is a full-service bank focused on Middle Africa. It
provides wholesale, retail, investment and transactional banking services to
governments, financial institutions, multinationals, local companies, SMEs and
individuals. Ecobank’s services are delivered by three customer-focused business
segments, Corporate Bank, Domestic Bank and Ecobank Capital all of which are
supported by an Integrated IT platform operated by Process, the group’s
technology subsidiary Corporate Bank provides financial solutions to global and
regional corporates, public corporates, financial institutions and international
organizations. Products focus on pan-African lending, trade services, cash
management, internet banking and value chain finance. Domestic Bank provides
convenient, accessible and reliable financial products and services to retail, local
corporate, public sector and microfinance customers, leverages an extensive branch
and ATM network as well as mobile, internet and remittances banking platforms.
Ecobank Capital provides treasury, corporate finance and investment banking,
securities and asset management solutions to corporate and governmental

37
customers. Ecobank also operates within Ecobank Capital a Research team based
on the ground in key markets, provides unique information support capabilities.
Ecobank operates as “One Bank” with common branding, standards, policies,
processes to provide a consistent and reliable service across its unique network of
1,151 branches, 1,487 ATMs, and 2,151 POS machines servicing 8.4 million
customers. It has an integrated information technology platform, with all of its
operations successfully migrated onto a single core banking application: Oracle
FLEXCUBE. With 23,350 employees (as at end of 2011), the Group is the largest
employer of labour in the financial sector industry in Middle Africa.
Sustainability is at the core of Ecobank’s mission and vision of building a world-
class pan-African bank that contributes to the integration and socio-economic
development of the continent. We take the view that the long-term success of
Ecobank is intertwined with the sustainable development of the economies,
societies and environment that we operate in. In 2011, the Group adopted an
integrated and comprehensive approach to sustainability and created a common
framework. The framework depicts sustainability such that her business
operational model ensures effective, efficient and sustainable utilization of
economic, social, human and natural capital. This framework reflects her
commitment to drive economic transformation in Africa while protecting her
environment by being a socially responsible financial institution with a world class
professional. Each strand forms the building block for her integrated sustainability.
EBC has an authorised capital of ten (10) billion FCFA, with 79.85% of these
shares held by the parent ETI, 6.45% by some local insurance companies and
13.7% by some individual Cameroonians. EBC presently has 27 branches spread in
the different vibrant towns and cities within Cameroon and is one of the leading
multinational banks within the Cameroonian economy.

38
3.2 SOURCES AND TYPES OF DATA
The method of data collection is a crucial aspect in any research because
imprecision in the methods of data collections would adversely affect the result of
the study and hence provide the result that are invalid (Siamak N. Soudani, 2012).
Data for this research would be collected both from primary and secondary
sources. The case study-ECOBANK would be the primary source meanwhile, the
internet, resourceful textbooks and journals would be the secondary sources of
data.
The major types of data collected here will be primary, raw or first-hand data
which are collected through the use of Questionnaires. First-hand data has been
sought because it is but imperative for a social science research of this magnitude.
Besides enhancing focus on the specific purpose of the research which can only be
obtained from the field, primary data also warrants a higher level of control over
the data collected. There is also the collection of some amount of secondary data to
meet the huge data need of the project. Secondary data collection saves time and
cost. The data is of high quality, offers more time for data analysis and reanalysis
which may result in better interpretation. However, the lack of familiarity, risk of
outdated data, complexity and at times, lack of control over quality, pose serious
threats to the use of secondary data.

3.3 INSTRUMENTS OF DATA COLLECTION

The main instruments that will be used in the collection of data include accounting
system design and maintenance, areas of system application and customers’
responses, common system plagues, system performance (effectiveness and
efficiency), impact of the system on the bank, comparism of manual system and
computerised system.

39
3.4 SAMPLE DESIGN AND SAMPLING PROCEDURE
The entire staff of ECOBANK (about 400 employees) will make up the population.
Since the study is localised at the Buea Branch, the sample will be drawn from the
working staff of ECOBANK Buea branch, who are eight (8) in number. The staff
of this branch is categorised into the Branch Manager, the Customer Care Officers,
the Account Relation Officers, and the Tellers. Because they all make use of the
ICT software package in executing their different functions, they will all comprise
the interview respondents.

3.5 INSTRUMENTS OF DATA ANALYSIS

This involves discussion of the measures put in place in analysing the data
collected from the questionnaire. A thorough and systematic examination is
important in order to accomplish a good result (Andersen, 2006). The study will
use both descriptive and inferential statistics in analysing the data. The Likert
methodology, percentages, bar charts and the descriptive statistics will be
employed in the data analysis. There would also be the use of tables.
The will be employed by the researcher to test the significance of the responses
from both the managerial and functional staff of Ecobank Cameroon S.A
(respondents). The descriptive statistics will be performed by defining the numbers
categories and observing the number of cases falling into each category and
knowing the expected number of cases fully in each category.

3.6 RELIABILITY OF RESEARCH INSTRUMENTS

A study which seeks to test how ICT significantly improves the performance of
accounting systems in financial institutions without examining how ICT packages
are designed and maintained, where and how they are applied, problems that
impede its application, its performance, customers’ responses and its overall

40
benefit for an institution will lack focus. Having taken all of these into
consideration, it is expected that the study will yield a more reliable result with
respect to how information system troubles could be shoot, more reliable systems
developed and instituted and proper recommendations accorded present and
prospective system designers and users.
In addition, the data analysis instruments such as percentages, tables, the Likert
scale and the chi-square test will be used because of the relative ease they pose in
presenting, analysing and comparing qualitative data. The chi-square test for
instance, is easier and more suitable for use in analysing qualitative data, compared
to the regression analysis that is more suitable for bi-variate quantitative data.
3.7 VALIDATION OF THE INSTRUMENTS
The various instruments of data collection are outlined to picture the main areas
and concerns in an accounting information system. The short-listed variables will
thus facilitate data collection, ease presentation and analysis and enhance
conclusions and consequently, major recommendations. Equally, a large amount of
researchers use data analysis instruments such as the five-point Likert scale
methodology because it is relatively easy for respondents to use, and responses
from such a scale are likely to be reliable (Lam et al, 2008).

3.8 LIMITATIONS OF THE INSTRUMENTS

To mention that the instruments that will be used exhaust the all possible
instruments or are the best may be grossly fallacious. The instruments cited above
are thus valid under the precincts of the objectives of this research specifically.
Also, no instrument by itself avails required data. Therefore the reliability of these
instruments is heavily dependent upon the information sufficed by field
respondents which are subject to respondents’ attitudes and the inadequacy of
information.

41
 CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

This research sought to investigate the role, impact or effect of introducing and
using ICT in accounting systems in financial institutions. In a bit to easily
accomplish this objective, it has been further split to identify problem areas
associated with ICT and accounting information systems, determine how a sound
ICT-based accounting system can be maintained in financial institutions and to
make recommendations regarding the use of ICT in AIS in financial institutions
and other institutions on a wider note. These objectives were captured in research
questionnaires which were administered at selected financial institutions.
A total of 8 questionnaires were distributed to all working staff of ECOBANK.
After the questionnaires were filled by the respondents and recollected, they were
screened and sorted by the researcher. These questionnaires were divided into four
sections; A, B, C, and D. Section A captured basically demographic information
related to the research respondents, , section B, the main areas of the application of
the computerised system and customers' responses, Section C,the system
performance and Section D, the overall impact of the computerised accounting
system on the organisation.

4.1 CHARACTERISTICS OF RESPONDENTS

The details of the returned questionnaires show that out of 8 sent out, all 8 were
completed and returned (8 from ECOBANK ). All returned questionnaires were
properly completed. Hence 100% of the respondents (100% from ECOBANK )
returned their questionnaires.

42
4.1.1 Gender
Field data captured from the research questionnaires show the following data
relating to the sex of research respondents.
Table 4.1: Gender
Valid Numbers percentage Valid Cumulative
percentage percentage
Male 3 37.5 37.5 37.5
Female 5 62.5 62.5 100
TOTAL 8 100 100
Source: Field Survey, May 2018
From the above table, it can be deduced that there are more feminine than
masculine workers at ECOBANK (62.5%:37.5%). A unfair balance is however
struck when the respondents from ECOBANK are constituted of mostly feminine,
hence, unfairly equal representation of both sexes in the banking service
(37.5%:62.5%). This is shown by the below figure.
Figure 4.1: Gender
9
8
7
6
5 female
4 male
3 total
2
1
0
1

Source: Field Survey, May 2018

43
4.1.2 Qualification
The below data depicts the information relating to the qualification of respondents.
Table 4.2: Qualification of Respondents
Valid Number percentage Valid Cumulative
Percentage percentage
A-level 4 50.0 50.0 50.0
HND 2 25.0 25.0 75.0
Bsc 2 25.0 25.0 100.0
TOTAL 8 100.0 100.0
Source: Field Survey, May 2018

From the table above, it can be deduced all respondents from Ecobank are
Bachelor Degree holders (25%),also 25% of the respondents are HND holders and
majority which is 50% are A-level holders In all, 75% of the respondents are
holders of undergraduates degrees and 25% hold Bsc degree. One can therefore
say that most bank staff holds Hnd and A-levels degree in Accounting. These are
presented in the following figure.

44
Figure 4.2: Respondents' Qualifications
9

6
A-LEVEL
5
HND
4
B.SC
3 Total
2

0
1

Field Survey, May 2018

4.1.3 Working Experience

Accumulated experience in any profession gives a deeper understanding of the
different challenges and short comings in every work environment, thus a good
number of years of experience of respondents make observations reliable. Table
4.3 shows the number of years of experience of respondents.
Table 4.3: Working Experience
age in service

Valid Valid Cumulative

Number Percentage percentage percentage
less than 1 2 25,0 25,0 25,0
year
1 to 2 3 37,5 37,5 62,5
3 to 5 3 37,5 37,5 100,0
Total 8 100,0 100,0
Source: Field Survey, May 2018

45
From the above table, it can be observed that 25% of the respondents from
Ecobank have served in the banking service for less than a prior to this study; The
data shows that majority of the respondents from ECOBANK have served the
industry for at most 2 years (37.5%). Equally 37.5 of the respondents from
Ecobank have served in the industry for at most 5years.In all, a majority of the
respondents have served the banking sector for at most 5years only. This is
indicative of the late development of private banking business in the Cameroon
economy and the late coming of the multinational Ecobank to Cameroon,
moreover, according to the survey most of the workers are experienced but not for
long due to the rapid change in the technology today. These are shown on the
figure below.
Figure 4.3: Respondents' Working Experience
9

4 Série1

0
< 1YEAR 1 to 2yrs 3 to 5yrs Total

Source: Field Survey, May 2018

4.1.4 Departments
The respondents were asked of the various departments and their responses are
presented below.

46
Table 4.4: department

Valid Valid Cumulative

Number percentage percentage percentage

management 1 12,5 12,5 12,5

finance 2 25,0 25,0 37,5

customers 4 50,0 50,0 87,5

credit and 1 12,5 12,5 100,0

marketing

Total 8 100,0 100,0

Source: Field Survey, May 2018

It has been observed that 25% of respondents are of finance and cash management
department, 50% from the customer care department and 12.5% from credit and
marketing department. Information technology and accounting departments which
are focal points are not represented in ECOBANK. Also, responses were received
from the management who are key overseas in the profession that entails to 12.5%.
These are depicted in the following figure

47
Figure 4.4: Department of Respondents
9

7 Management
6

5 Finance

4 customers

3 credit and marketing

2
TotaL
1

0
1

Source: Field Survey, May 2018

Table 4.5: System application areas and customer response
Table 4.5.1 : Interbranch accounts can easily be consolided via system
even on a daily basis
valide Valid Cumulative
Numbers percentage percentage percentage
agree 2 25,0 25,0 25,0
neutral 1 12,5 12,5 37,5
disagree 2 25,0 25,0 62,5
strongly 3 37,5 37,5 100,0
disagree
Total 8 100,0 100,0
Table 4.5.2 : The use of ict devices such as the Atm and the
electronic cards has boasted customer morals
Valid Valid Cumulative
Numbers Percentage percentage percentage
strongly agree 2 25,0 25,0 25,0
agree 3 37,5 37,5 62,5
neutral 3 37,5 37,5 100,0
Total 8 100,0 100,0

48
 Table 4.5.3: Customers often become aggressive when the
system fails to yield to their needs

Valid Valid Cumulative

Numbers Percentage percentage percentage

strongly agree 1 12,5 12,5 12,5

agree 3 37,5 37,5 50,0

neutral 3 37,5 37,5 87,5

disagree 1 12,5 12,5 100,0

Total 8 100,0 100,0

Source: Field Survey, May 2018

Table 4.5 shows the main areas where the technology impacted accounting system
is applied in the ecobank sampled and how bank customers in this bank react to the
effects of this application. There is a strong agreement (25% on 100%) that the
system is applied to areas like customer account updates, bank reconciliations,
interbank transfers and the bang clearing system. Equally, the computerized
system attracts eases inter-branch account consolidation, enlarges the banks
customer base and boosts customer Morales. These are evidenced by strongly
agree responses of 25%, an agree response of 37.5% and a neutral response of
37.5% on a percentage scale of 100%.
Asked to know how customers react during periods of failure of the accounting
system, 12.5% of the respondents strongly agree, are of the opinion that most
customers become aggressive, 37.5% agree, meanwhile the remaining 50% are

49
either irresolute or disagree. It will thus be safer for financial institutions to try as
much as it takes to prevent system breakdowns.
4.1.5 Appraisal of ICT and the functioning of the accounting System
Respondents were asked to give their appraisals per the functioning of the
accounting system in base based on the way it has been impacted by ICT and the
results thereof are herein presented.
Table 4.5.4: Appraisal of the functioning of the ICT-based accounting system
Ecobank Total
Alternative NO % NO %
Positive Impact 6 75 6 75
Negative Impact 2 25 2 25
Neutral 0 00 0 00
Total 8 100 8 100
Source: Field Survey, May 2018
Based on the information gotten, almost all respondents in Eco bank affirm that
ICT has a strong positive impact on the accounting systems within their banks
except for the 25% that gave a negative impact on the system within their banks,
hence a 75% positive response rate. The figure below depicts this information.

50
Figure 4.5 Appraisal of the Functioning of the ICT-based Accounting System
120

100

80

60

40

20

0
NEGATIVE POSITIVE NEUTRAL TOTAL
IMPACT IMPACT

Source: Field Survey, May 2018

4.2 PROBLEMS IN ICT AND ACCOUNTING SYSTEMS PERFORMANCE

The first objective of this research is to identify the problems associated with ICT
and accounting systems in financial institutions. This objective was captured by
Section C of the research questionnaire-Accounting system performance. Four
questions relating to the functioning of the accounting systems and the results
obtained are presented below.
Table 4.6: System Performance (Effectiveness and Efficiency)
Table4.6.1: The banking sofware pakage used produce all
relevant financial statement and reports
Valid Valid Cumulative
Number Percentage percentage percentage
agree 5 62,5 62,5 62,5
neutral 2 25,0 25,0 87,5
disagree 1 12,5 12,5 100,0
Total 8 100,0 100,0

51
 Table4.6.2: Access to confidential data and information is
strickly delimited to delegated operators via special
security and access codes
Valid Valid Cumulative
Numbers Percentage percentage percentage
agree 4 50,0 50,0 50,0
neutral 2 25,0 25,0 75,0
disagree 2 25,0 25,0 100,0
Total 8 100,0 100,0

Table4.6.3 :The average data processing speed has

tremendously reduced due to mechanisation and automation
of the accounting system
Valid Valid Cumulative
Numbers Percentage percentage percentage
strongly 5 62,5 62,5 62,5
disagree
agree 3 37,5 37,5 100,0
Total 8 100,0 100,0

Source: Field Survey, May 2018

From table 4.6, one can deduce that the accounting system put in place in these
banks generate all relevant financial statements needed by the bank (62.5%
positive response on 100%) meanwhile 37.5% of the response was neutral and
disagree, data access strictly delimited through the use of security and access codes
( 50% of positive response) meanwhile the other respondents were in neutral and a
disagreement state(50% of neutral or disagree).
To know whether any staff of the bank could alter data via special procedures and
whether mechanisation and automation has reduced data processing speed, the
responses gotten of are ( 62.5% standing as a negative response and 37.5% as a

52
positive response), but enough proof individuals are not mandated to key in data in
the system and that automation poses no threat at all to data processing speed with
67% on 100% scale.
This section also shows that the average daily customer service rate is higher
compared to the days of manual imputation 100% and that the banks save to a
reasonable degree some operation-related costs resulting from automation and
mechanisation

4.3 RECOMMENDATIONS FOR THE INSTITUTION OF ICT-BASED

ACCOUNTING SYSTEMS
This part of the work seeks to make recommendations regarding the institution and
implementation of ICT based accounting systems in financial institutions. They
were captured in section D of the research questionnaire. They presented in the
tables that follow.

53
Table 4.7: Impact of ICT-based accounting system on banks
Table 4.7.1: The bank can readily make forecast of her revenue and expenditure
Valid Numbers Percentage Valid Cumulative
percentage percentage

Strongly agree 3 37.5 37.5 37.5

Agree 3 37.5 37.5 75.0

Neutral 1 12.5 12.5 87.5

Disagree 1 12.5 12.5 100

Total 8 100 100

Table 4.7.2: Wide competitive edge over Financial

institutions which can not afford such system
Valid Valid Cumulative
Number Percentage percentage percentage
agree 3 37.5 37,5 37,5
neutral 4 50.0 50,0 87,5
disagree 1 12,5 12,5 100,0
Total 8 100,0 100,0

Table4.7.3: Enhanced of management decisions resulting from readily

available Data

Valid Number Percentage Valid Cumulative

s percentage percentage
agree 5 62,5 62,5 62,5
neutral 1 12,5 12,5 75,0
Disagre 1 12,5 12,5 87,5
e 1 12,5 12.5 100
Strongly
disagre
e
Total 8 100,0 100,0

54
 Table4.7.4 : Wide market coverage resulting from improved
performance, consistency and effectiveness use of the system
Valid Valid Cumulative
Numbers Percentage percentage percentage
strongly 2 25 25 25
disagree
agree 6 75 75 100,0
Total 8 100,0 100,0

Table 4.7.5 : High customers turnover resulting from frequent

system failures and countless errors on the document generated
by the system
Valid Valid Cumulative
Numbers Percentage percentage percentage
strongly agree 1 12,5 12,5 12,5
neutral 2 25,0 25,5 37,5
disagree 5 62,5 62,5 100,0
Total 8 100,0 100,0
Source: Field Survey, May 2018
Table 4.7 depicts the entire impact of ICT on accounting systems in financial
institutions. Based on the analysis made on the above questions posed in the
research questionnaire, all respondents positively affirm the outlined impacts
resulting to an agree responses of 75.0%, 37.5% , 62.5%, and 75% on 100% for
Table 4.7.1, 4.7.2, 4.7.3, and 4.7.4 respectively.
Table 4.7.5 however, having the lowest positive response of 12.5% on 100%, is
enough to support the assertion that automation does not resort in making
customers worse off. Automation and mechanisation makes situations better off
and so, this objective should be sought in every domain where automation or
mechanisation is earmarked.

55
This overall impact has been used as a basis for the test of hypothesis in section 4.5
and also to summarise major findings in section 5.1, and recommendations in
section 5.4.

4.5 Hypothesis Testing

Given that the conditions requiring the test of hypothesis using descriptive
statistics.
Hypothesis: Information Communication Technology (ICT) does not significantly
improve performance of accounting systems in financial institutions.
The impact of ITC on accounting performance
With the use of descriptive statistics and taking record of the responses, we
realized that from the above statistic of questions asked in the questionnaire and
sent to the respondent saw that analogically the agreed and strongly agree in total
is equal to 49% on a scale of 100% meanwhile the disagreed and strongly
disagreed responses were in total just 17% on a scale of 100%, leaving neutral with
34% on 100% in total. Thus we can boldly write that the hypothesis that says ICT
does not significantly improve accounting systems in Financial institution is
rejected thus,
we reject Ho and hence conclude that ICT significantly improves the performance
of accounting systems in financial institutions(H1).

56
 CHAPTER FIVE

SUMMARY OF MAJOR FINDINGS, CONCLUSION AND

RECOMMENDATIONS

5.1 SUMMARY OF MAJOR FINDINGS

Throughout this study, we have been concerned with assessing the impact of ICT
on accounting systems in financial institutions. To meet this main objective, we
went through several sub objectives, including the examination of the main
problem areas in ICT-based accounting systems, attempt to determine how a sound
ICT-based accounting system could be instituted, and a provision of guidelines
toward the institution of good and reliable accounting systems. To further ease
arrival at our point of focus, we raised some research questions to support our
intention. Having logically gone through a rigorous research process, our findings
are summarised in the following points.

 Most financial institutions make use of computers (hardware and software),

telecommunication devices (telephone, telex, facsimile, etc), and electronic
information repositories (WWW, WAN, LAN, ATM, etc) in data capture and
recording.
 ECOBANK does not own an accounting nor an information technology
department (table 4.4).
 ICT tools are applicable to areas such as automatic account updates, text
message notifications, bank reconciliations, bank transfers and remittances,
bank clearing, annual accounts, general ledger updates and managerial reports
preparation, etc.

57
 Licensed experts/institutions are charged with the design and institution of
software packages. An example is Process an IT partner to ECOBANK
Cameroon S A.
 Accounting packages readily generate daily, end of period or as deemed
financial statements and reports.
 Fraud, errors and time wastage have been eliminated as a result, and speed and
accuracy tremendous boosted due to ICT usage.
 Customers just like the bank staffs enjoy the usage of ICT infrastructures and
proudly belong to modernised financial institutions.
 Manual procedures are still undertaken when major breakdowns impede usage
of mechanised and automated accounting systems.
 Computerised accounting systems avails more time for trained staff to put in
more in the managerial process by assisting in and data analyses to facilitate
reasonable decisions.
 Major troubles to ICT systems include frequent network failures, low
processing speeds, threats from hackers and spammers, errors resulting in
recording inconsistency, cost transfer queries between the bank and her
customers.
Managers are very busy in the planning, coordination and control functions. This is
evidenced by table 4.4, since just one of them could complete and return
administered questionnaires despite the two-week time lap accorded them for the
process.

5.2 CONCLUSION
Nothing has indeed, impacted lifestyle like the growing use of ICT in nearly every
activity. This has made the world more globally a village than ever. Gone are the
days when distance stood barriers to the accomplishment of any objective, whether
58
business or not. This has however come with great costs, thereby, leaving cost as
the separation gap between any goal and its accomplishment.
Accounting systems have benefited enormously from these innovations and greatly
improved performance and profitability. Some of such merits include among others
the following points.
Time-saving with respect to transaction processing, increased accuracy and the
production of a whole series of reports are obvious desirable and realistic benefits
when computers are used for accounting.
Computers can be used in all aspects of the accounting system. When computers
are used for some or all of these activities they can do everything that can be done
with a manual system, but computers often do them faster, more accurately, and
more efficiently.
Increased job satisfaction and more effective use of operator time can be an added
bonus of computerisation.
Many more benefits of computerisation tend to become apparent as businesses
develop their systems.
The benefits of computerised accounting systems however, vary from business to
business, with each one deriving different benefits. It may well be the case that a
business can derive no benefit at all from computerisation.
Some benefits bring problems of their own. For example, once computers are
being used effectively in an accounting system, managers will often find
themselves extracting reports that under a manual system could not be achieved
within a timescale that would serve a useful purpose. The improved reporting and
analysis that can be achieved by computerisation should improve the whole
decision-making process within a business, but it can also lead to information
overload as decision-makers suddenly find they have too much information for
them to fully understand and apply.
59
5.3 RECOMMENDATIONS
Following the results obtained from the field and based on examined theories and
infrastructures in place at different financial institutions, it is worthy to recommend
that:
 A regulatory institution should be set up in Cameroon to legislate and improve
upon the acquisition and usage of ICT tools in financial and other institutions at
large.
 There should be a cohabitation of training for both software package designers
and users so as to minimise the discrepancies resulting from customisation
processes.
 There should still be rigorous academic training for accountants despite the
merits of the computerised systems. This will enable the accountants to audit
and assess the reliability of output generated by automated accounting systems.
 Banks should afford a maintenance agent or staff each at branch levels so as to
easily rectify unexpected system failures and reduce customers’ dissatisfaction.
 Continuous research in ICT should be encouraged by the banks and other
financial institutions so as to always augment overall service quality to
customers.
 Bank customers should be duly informed and regularly reminded of the
different service charges to which they are liable before eventual deductions are
made from their accounts so as to minimised customers’ grieves against the
bank.

60
 The University of Buea should introduce a compulsory computerized
accounting program or course for all accounting students in order to meet the
challenges of the job market brought about by information technology.
Considering the many benefits accruing to the usage of computerised systems, it is
very worthwhile for financial institutions to fully incorporate the usage of ICT
tools in their operations. To do this without hitches, the following considerations
must be made.
Deciding whether to mimic what the institution has been doing manually or start
from scratch and redesign everything.
Deciding whether to buy a general accounting package ‘off-the-shelf’ or create one
from scratch. Depending on the size of the business, creating one from scratch may
be done using a spreadsheet and a database package or it may involve having
computer programmers writing the entire system.
If an institution decides to buy one off-the-shelf, there is need to decide how much
to customise it, if at all. If a decision is made not to customise it, or there are no
possibilities of customising parts of it, the institution may need to change the
terminology used when referring to parts of the accounting system. For example,
Sage uses the term ‘Customers Module’ rather than Sales Ledger and ‘Suppliers
Module’ instead of a Purchases Ledger.
The institution needs to decide who is going to be responsible for overseeing the
project.
The institution also needs to decide how long she is going to allow for the new
system to be developed and make plans to introduce it accordingly.
The institution must also decide who is to be trained in using it and when.
The institution needs to decide how long she will run the new system in parallel
with the existing manual system before she stops using the manual system.

61
The institution needs to identify the hardware she will need and ensure that it is in
place at the appropriate time.
The institution needs to identify who is going to test the new system and what data
is to be used to do so.
The institution needs to weigh up the costs and benefits of computerising the
accounting system and decide whether it is actually worth doing it.
If all financial institutions and other sectors of the Cameroon economy follow
the above mentioned recommendations and other recommendations from other
researchers in the field of ICT in accounting systems by effectively implementing
ICTs in all their operations, there will be a rapid growth in the financial sector
and the economy as a whole given that the financial sector is the backbone of
economic development. If this metamorphosis takes place in Cameroon, then one
would be right to say that the president overestimated the country’s emergence in
2035.

5.4 Suggestions for Further Research

The limitations restricted this study to two financial institutions only, among the
many financial institutions and in their different categories. Further research work
on “The Impact of ICT on Accounting Systems in Financial Institutions” should be
carried out with a wider coverage in the different categories of financial
institutions in Cameroon. This may add credit or overrule the results set forth in
this study.
To answer a question of threats to the accountants’ jobs, a study should be carried
out to ascertain the impact of ICT on accounting practices and the role of the
accountant in the accounting profession.
Studies should also be carried out to check the effects of the separation of duties
between the design (IT specialist) and use (accounts officer or worker) in the

62
design and implementation of accounting and information system software
packages.
Further research work is also required on computer and the business world,
computer effects on mankind, and benefits of the advent computer

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 APPENDICES

Appendix 1: Research Questionnaire

Dear respondent,
I am NCHE CLOVIS TANGIE, a final year Accounting Student in the above
named Department and Institution presently conducting a research on “The
Impact of ICT on Accounting Systems in Financial Institutions” in partial
fulfillment of the requirements for the award of a Bachelor of Science degree in
Accountancy.. The findings are strictly to be used for academic purpose only.
Kindly represent your perception on the items in this questionnaire sincerely. Be
sure that the information obtained will be accorded the confidentiality it deserves
and its use will be limited to this study.

Please tick [√] or fill in the appropriate box or spaces provided to

indicate your answers.
Section A: Demographic information
i. Sex Male [ ] Female [ ]
ii. Academic qualification? GCE O’L [ ] GCE A’L/OND [ ] HND [ ]
B.SC/BT [ ] M.SC/MBA [ ] PHD/DBA [ ]
iii. How long have you been in service in the banking profession? < 1 Year [ ]
1-2 years [ ] 3-5 years [ ] 6-10 years [ ] > 10 years [ ]
iv. Which of these departments do you belong to? Accounting [ ] Management
[ ] Finance and cash management [ ] Customer Care[ ] Business
Development [ ] Information Technology [ ] Credit and Marketing [ ]
v. Respondent’s position………………………………………………………...

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Section B: System Application Areas and Customer Response
1. Inter branch accounts can easily be consolidated via the system even on a
daily basis. Strongly agree [ ] Agree [ ] neutral [ ] disagree [ ]
strongly disagree [ ]
2. The use of ICT devices such as the ATM and the Electronic Cards has
boasted customer morals and has generally built a wider publicity and
goodwill for the bank. Strongly agree [ ] Agree [ ] neutral [ ]
disagree [ ] strongly disagree [ ]
3. Customers often become aggressive when the system in place fails to yield
to their needs and wants or when major discrepancies are evident. Strongly
agree [ ] Agree [ ] neutral [ ] disagree [ ] strongly disagree [ ]
What is your appraisal of customer response as a result of the application of
the computerised accounting system?
_____________________________________________________________
_____________________________________________________________

Section C: System Performance (Effectiveness and Efficiency)

4. The banking software package used produces all relevant financial
statements and reports when ever such queries are made. Strongly agree [ ]
Agree [ ] neutral [ ] disagree [ ] strongly disagree [ ]
5. Access to confidential data and information (the bank’s data bank) is strictly
delimited to delegated operators via special security and access codes.
Strongly agree [ ] Agree [ ] neutral [ ] disagree [ ] strongly
disagree [ ]

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 6. The average data processing speed has been tremendously reduced due to
mechanisation and automation of the accounting system. Strongly agree [ ]
Agree [ ] neutral [ ] disagree [ ] strongly disagree [ ]
7. What can you say about the overall performance of your accounting system
as a result of it computerization?
_____________________________________________________________
_____________________________________________________________
Section D: Impact of the System on the Organisation
8. The bank can readily make a forecast of her revenue and expenses (budget)
using her wide information data base. Strongly agree [ ] Agree [ ]
neutral [ ] disagree [ ] strongly disagree [ ]
9. The bank can boast of a wide competitive edge over other financial
institutions which cannot afford such a system design. Strongly agree [ ]
Agree [ ] neutral [ ] disagree [ ] strongly disagree [ ]
10.The bank can easily create more and manage existing branches since all
branch information can be monitored real-time online at the head office
through the electronic network. Strongly agree [ ] Agree [ ] neutral [ ]
disagree [ ] strongly disagree [ ]
11.Management decisions are enhanced as daily financial details can readily be
processed from the system. Strongly agree [ ] Agree [ ] neutral [ ]
disagree [ ] strongly disagree [ ]
12.Many customers have quitted the bank because of frequent system failures
and countless errors on the bank statements and other documents generated
by the system. Strongly agree [ ] Agree [ ] neutral [ ] disagree [ ]
strongly disagree [ ]
13.In your humble opinion, how has the implementation of the ICT in your
accounting system benefited the bank?
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__________________________________________________________________
__________________________________________________________________
________________________________________________________________

Appendix 2 tables of variable responses

interbranch accounts can easily be consolided via system even on

a daily basis
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide agree 2 25,0 25,0 25,0
neutral 1 12,5 12,5 37,5
disagree 2 25,0 25,0 62,5
strongly 3 37,5 37,5 100,0
disagree
Total 8 100,0 100,0

the use of ict devices such as the atm and the electronic cards
has boasted customer morals
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide strongly 2 25,0 25,0 25,0
agree
agree 3 37,5 37,5 62,5
neutral 3 37,5 37,5 100,0
Total 8 100,0 100,0

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 gender
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide male 3 37,5 37,5 37,5
female 5 62,5 62,5 100,0
Total 8 100,0 100,0

level of eduaction
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide a level 4 50,0 50,0 50,0
hnd 2 25,0 25,0 75,0
bsc 2 25,0 25,0 100,0
Total 8 100,0 100,0

age in service
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide less than 1 2 25,0 25,0 25,0
year
1 to 2 3 37,5 37,5 62,5
3 to 5 3 37,5 37,5 100,0
Total 8 100,0 100,0

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 department
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide management 1 12,5 12,5 12,5
finance 2 25,0 25,0 37,5
customers 4 50,0 50,0 87,5
credit and 1 12,5 12,5 100,0
marketing
Total 8 100,0 100,0

customers often become aggressive when the system fails to

yield to their needs
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide strongly 1 12,5 12,5 12,5
agree
agree 3 37,5 37,5 50,0
neutral 3 37,5 37,5 87,5
disagree 1 12,5 12,5 100,0
Total 8 100,0 100,0

the banking sofware pakage used produce all relevant

financial statement and reports
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide agree 5 62,5 62,5 62,5
neutral 2 25,0 25,0 87,5
disagree 1 12,5 12,5 100,0
Total 8 100,0 100,0

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 access to confidential data and information is strickly
delimited to delegated operators via special security and
access codes
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide agree 4 50,0 50,0 50,0
neutral 2 25,0 25,0 75,0
disagree 2 25,0 25,0 100,0
Total 8 100,0 100,0

the average data processing speed has tremendously reduced

due to mechanisation and automation of the accounting system
Pourcentag Pourcentage Pourcentage
Effectifs e valide cumulé
Valide strongly 5 62,5 62,5 62,5
agree
agree 3 37,5 37,5 100,0
Total 8 100,0 100,0

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