RIFT VALLEY

UNIVERSITY

DEPARTMENT OF ACCOUNTING AND FINANCE

ASSESSMENT OF ACCOUNTING INFORMATION

SYSTEM AND ITS APPLICATION (A CASE OF DASHEN
BANK MICKYLELAND BRANCH)

RESEARCH PROPOSAL

Prepared by: TESHOME KEBEDE

TEWODROS YIHDEGO

SAMRAWIT TEKLE

SELAMAWIT YESHANEW

Advisor: TADESSE KEBEDE

MARCH 2020

RVU
 TABLE OF CONTENTS
Title Page

TABLE OF CONTENTS.....................................................................................................i
CHAPTER ONE..................................................................................................................1
INTRODUCTION...............................................................................................................1
1.1 Background of the Study...........................................................................................1
1.2 Statement of the Problem...........................................................................................2
1.3 Research Questions…................................................................................................3
1.4.Objectives of the Study…………………………………………………………...3
1.4.1 General Objectives of the Study……………………………………………….3
1.4.2 Specific Objectives of the Study.........................................................................3
1.5 Research Design and Methodology...........................................................................4
1.5.1 Research Design...............................................................................................4
1.5.2 Sampling Design...............................................................................................4
1.5.3 Sources of Data.................................................................................................4
1.5.4 Method of data collection.................................................................................4
1.5.5 Methods of data analysis..................................................................................5
1.6 Significancy of the study..............................................................................................5
1.7 Scope of the study ........................................................................................................5
1.8 Organization of the Paper..............................................................................................6
1.9 Time And Cost Budget..................................................................................................6
1.9.1 Time budget............................................................................................................6
1.9.2 Cost budget............................................................................................................7
 CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Organization depends on information systems in order to stay competitive. Information is just as

much as a resource as plant and equipment. Productivity, which is crucial to staying competitive,
can be increased through better information systems. Accounting, as an Information system,
identifies, collects, processes, and communicates economic information about an entity to a wide
variety of people. Information is useful organized data such that correct decisions can be made
based on it. A system is a collection of resources related such that certain objectives can be
achieved (F.Belfo, A. Trigo, 2013).

An accounting information system is a collection of resources, such as people and equipment,

designed to transform financial data into information. This information is communicated to a
wide variety of decision makers. Accounting information systems perform this transformation
whether they are essentially manual systems or thoroughly computerized information systems.
An organization is a collection of decision making units that exists to pursue objectives. As a
system, every organization accepts inputs and transforms them in to output that take the form of
products and services. A manufacturing firm transforms raw material, labor, and other scarce
resource inputs in to tangible items, such as furniture, that are subsequently sale in pursuit of the
broad goals of education and the promotion of knowledge. Conceptually All organizational
systems seek objectives through a process of resource allocation. This is accomplished through
the process of managerial decision making. Information has economic value to the extent that
facilitates resources allocation decisions, thus assisting a system in its pursuit of goals. Indeed,
information may be the most important organizational resource.
The users of accounting information fall in to two broad groups: external and internal. External
users include stakeholders like investors, creditors, government agencies, customers and vendors,
competitors, labor unions, and the large. External users receive and depend on a variety of
outputs from an organization’s accounting information system. Many of these outputs are of a
routine nature. Accounts payable transactions with suppliers, for example, require outputs such
as purchase orders and checks from an organization’s accounting information system. Customers
receive bills and make payments. Which are processed by the accounting information system?
Employees receive paychecks and other payroll-related data; stock holders receive dividend
checks and routine information concerning stock transactions.
The information needs of external users are various. The publication of general- purpose
financial statements, such as balance sheets and income statements, and other non-routine
outputs assist in meeting these needs. Stockholders, Investors at large, creditors, and other
external users utilize a firm’s general-purpose financial statements to evaluate past performance,
predict future performance, and gain insights in to an organization.
Internal users comprise of managers, whose requirements depend on their level in an
organization or on the particular function they perform. The accounting information system
summarizes and filters the data available to decision markers. By processing the data, the
accounting information system influences organizational decisions. (F.Belfo, A.Trigo, 2013).
1.2. Statement of the Problem

Accounting information system combine the study and practice of accounting with the design,
implementation and monitoring of information system. Such systems use of modern information
technology resources together with traditional accounting controls and methods to provide users
of the financial information necessary to manage their organizations. Each user groups has
unique information requirements and this depends up on the level of the organization from which
the information is needed .The higher the level of the organization , the greater the need for more
aggregated information and less need for detail(www.enotes.com ).The Dashen bank, which is
involved in the provision of development credit to viable priority projects along with technical
support and advice by mobilizing resources from domestic and foreign sources, has its own
accounting information system. Dashen bank is one of the banks required to use Accounting
information system (AIS) in order to make advanced decision, but the bank have different
drawbacks like: Low level awareness of AIS by employees as well as management staffs of
Dashen bank, failing of network connection /network Interrupt, lack of Human resource in AIS
department, delays in communication or networking of all the activities. The above problems
affect both the bank and the customer of Dashen bank.
1.3. Research question

The study will answer the next basic research questions about the accounting information system
of the organization:

 Is the application of accounting information system of the bank efficient and effective on
correcting the above problems?
 How does Dashen bank applied its accounting information system for decision making?
 How Dashen bank’s accounting information system is applied in internal control system?
 What is the nature of the existing accounting information system use of Dashen bank
(manual, computer based or the mix of both)?

1.4. Objectives of the study

1.4.1 General Objective

The general objective of this study is to generally assess the accounting information system of
Dashen bank and its application for decision making.

1.4.2 Specific Objectives

The specific objectives of the study are:-

 To assess the application of accounting information system of the bank efficiency and
effectiveness.
 To know how Dashen bank applies its accounting information system.
 To know how Dashen bank’s accounting information system is applied in the internal
control system.
 To assess the nature and use of the existing accounting information system of Dashen
bank.
1.5 Research design and methodology

1.5.1 Research Design

For this research the researcher will use descriptive design survey method because the research
will be conducted in order to describe the existing accounting information system of Dashen
bank Mickyleland branch. Descriptive research is one which information is collected without
changing the environment. Therefore, it is the best method for collecting information that would
demonstrate relationships and describe the population as it exists.

1.5.2 Sampling Design

The study will be conducted at Dashen bank Mickyleland branch to assess accounting
information system. The source of data will be all employees and guards of the organization and
will be used census sampling method because they are few in number.

1.5.3 Sources of data

The data which has use for this study will be gathered from two sources. These are primary and
secondary sources.

 Primary source: This source includes the actual (primary) information which is
gathered from concerned individuals that is from the owner of small enterprise.
 Secondary source: these include all type of published and unpublished materials about
small scale enterprise. The data which is gathered from this source is secondary data
and includes data from reports, economic journals, internet and data from previously
done research.

1.5.4 Method of data collection

As mentioned above, there would be two sources of data i.e. primary and secondary sources. The
primary source is more relevant than the secondary source in that it gives relatively more reliable
data than secondary source. The primary data is collected by using interview and questionnaire.
Interview and questionnaire are needed because some individuals who will be used as a sample
may not be able to read and write and it is also needed relatively to avoid false information and
carelessness that may arise during filling the questionnaire. The use of secondary source is in
order to strengthen the information required and propose necessary suggestions for the problem.

1.5.5 method of Data analysis

The researcher will use descriptive data analysis method to present the outcomes of the research.
To make all the data collected and stored meaningful and consumable, appropriate analysis will
be made using tabular and percentage form of presentation bolstered by relevant explanation.

1.6 Significance of the study

This study tries to provide important information concerning the accounting information system
of Dashen bank. It will help the organization to achieve its task efficiently and effectively. The
organization would eliminate or at least minimize problems which are related with accounting
information system. This study tries to give recommendations with regard to the ways of solving
the problems being faced by the organization. It will use as a reference to those who need to
conduct research on this topic and identifying what is not studied. It also help the
student/researcher/ in the partial fulfillment of getting Bachelor of Arts degree (BA degree) and
acquire the knowledge’s to research work.

1.7 Scope of the study

The scope of the study is limited to the Dashen bank Mickyleland branch and the finance and
accounts management process division of the organization will be studied. The reason for
limitation to the finance and accounts management process division is because more of
accounting related information passes through it and the information can be easily obtained from
there. Furthermore the study is only focus on the assessment of the accounting information
system of the organization from 2015 up to 2019 G.C because of voluminous of information that
is difficult to manage.

1.8 Organization of the Paper

The paper will have four main chapters. The first chapter would be an introductory part
containing the back ground of the study, problem of the statement, objectives of the study,
significance of the study, and scope of the study. The second chapter will be the review of
related literature. Presentation, analysis and interpretation of the gathered data will be included in
the third chapter. The last chapter will be conclusion and recommendations.

1.9. Cost and Time budget

1.9.1. Time Budget

SN Month February
March April May
January June

Activity
1 Title selection 

2 Research 
design

3 Preparation of 
proposal

4 Data collection 


5 Data analysis


6 Writing the 
paper 

7 Editing and  
binding

8 Submission 

Table 1: The Schedule of Work Activities

 1.9.2. Cost Budget
Item Numbers needed Unit cost Total cost
Stationary materials
- Paper 1 package Birr 90/package Birr 90
- Pen 6 Birr 5.00 Birr 30
Cost of printing 90(including Birr 1.00/page Birr 90
defects)
Secretarial service 50 pages Birr 5/page Birr 250
(writing)
Flash 1 (8 GB) 150 birr Birr 150
Transportation 10 trips Birr 3.00/trip Birr 30
Telephone expense 15 Birr 5/card Birr 75
Sub total Birr 715
Contingency 40% Birr 286
Total Birr 1001

Table 2: Total Budget needed and Allocation

RIFT VALLEY UNIVERSITY

 DEPARTMENT OF ACCOUNTING AND FINANCE

QUESTIONNAIREE

Dear respondents

This questionnaire is being conducted by Forth year accounting and finance under graduate
students of Rift Valley University with the aim to collect data on the assessment of Accounting
Information System in the case of Dashen bank. You are not obligated to write your name. The
response in the questionnaire will be used only for research purpose. Confidentiality and privacy
will be maintained by keeping the respondents response on a separate place where no one can see
them both during the research process and in the compiled reports. The purpose of the study will
be for in partial fulfillment of the requirements for the degree of Bachelor of Arts in Accounting
and fiancé. The reliability of the study will be based on the accuracy of the information you
provide. Therefore, we highly appreciate your honest and genuine response in an effort to attain
the stated objectives of the assessment. The result of the study will hopefully serve as an
important input to improve the existing ways of grievance handling procedure.

Section one: employee information (Please, circle your choice)

1. Sex
A. Male C. Female
2. Age

A. Below 23

B. 23 – 32 D. 43 - 52

C. 33 - 42 E. Above 52

3. Length of time the employee has been working at the bank;

A. Below a year B. 1-6 years
C. 7-15 years D. Above 15 years
4. Current position in the bank:
A. Manager B. Accountant C. Credit officer
 D. IT officer E. Other (specify) -----------------------
5. Level of education
A. First degree B. Post Graduate

C. other (specify) ----------------------------

6. Experience in the bank:

A. Longer experience B. Satisfactory experience

C. Very short experience D. No experience

7. What is employee’s experience of being a user of AIS of the organization?

A. Very positive B. Positive C. Not bad D. Negative

8. How do you rate the quality of transaction processing provided by the AIS of your bank?

A. It has improved B. It has improved to a certain extent

C. it hasn’t improved D. it became even worse

9. What problem is the organization being experiencing with its management reporting?

A. Delay in Reporting B. Report Redundancies

C. Inconsistencies D. All are the Problems

10. Do you believe that information is being provided to outside users in a timely manner?

A. Yes B. No

11. What did observe in the improvements of the AIS of your bank in helping customer
satisfaction?

A. Increasing B. Increase to certain extant

C not increasing D. made it even worse

12. What problems you observe with your current AIS practice?
A. Lack of Good Communication B. Delay in Reporting

C. Insufficient AIS Support D. Inconsistencies

13. How did the development of computerized AIS help the organization’s operation?

A. Improved Provision of Information B. Reduced Delay in Reporting

C. Improved Transaction Processing D. Others, please specify………………….

14. Do the decision makers of the Dashen bank give emphasis towards efficient AIS with good
transaction processing, management reporting and provision of information to outside users?

A. Agree B. Disagree C. Strongly Agree D. Indifferent

15. Should the current system be changed or at least be modified?

A. Agree B. Disagree C. Strongly Agree D. Indifferent