Chapter One Introduction

CHAPTER ONE
INTRODUCTION
1.1 INTRODUCTION:
Afghan Telecom Corporation was incorporated in 24th September 2005 to provide unified
telecommunication services throughout Afghanistan under the stewardship of Ministry of
Communication & Information Technology. Accordingly, Afghan Telecom adopted a challenging
program aiming to transform its business from government system to the recognized commercia l
business standards, The company has developed clear strategies focusing on internal re-
organization, re-skilling and development of its staff, enhancement of its internal processes and
studying its customers' needs and requirements while continuing carrying out its national and social
duties and responsibilities.

Afghan Telecom Corporation is the leading national provider of telecommunication on services in

Afghanistan. The company is working continuously to fulfill and satisfy the market requireme nts,
& customer’s requirements keeping pace with the emerging technologies in the telecommunicatio ns
sector and satisfying the customer's needs.

Afghan Telecom Corporation understands that the world is changing very fast & rapid and
telecommunication is the only medium which can adapt to the changing times, Afghan Telecom is
the pioneer in implementing new telecommunication services in Afghanistan & a leader in the
Afghanistan telecommunication market. The role & use of telecommunications is significant for
the development of the people & the country. Believing in the importance of its customers and
fulfillment of their needs, Afghan Telecom Corporation is constantly adopting different strategies
that aim to support and re-enforce its competitive position, based on its strategy, Afghan Telecom
strives to enhance customer oriented culture in all its business aspects & modus operandi, this
culture has been reflected in the organizational design of the company that comprises the best
expertise in the Management level, a number of Functional Departments and Four key Business
development & Sales Units focused on the key Afghan Telecom.

Customer categories & sale points which are:

1. Corporate Sale point such as different internet service like WIMAX, DSL, Micro wave,
and P2P point to point wireless.

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Chapter One Introduction

2. Landline Telephone and Mobile, VCN (Village communication network) & DCN
(Domestic Communication Network).
3. Individual Sale Points & Dealers Sale Points.
The Accounts Payable System is used to process invoices against purchase orders and to generate
payment to vendors, this system maintains detailed accounting transactions of all invoices and
credit memos charged against an established purchase order, the system determines the payment
date of invoices based on the purchase order term, Once payment is generated, the Account payable
System records the amount, invoice and or credit memo numbers as well as the check number and
the date of the payment. Access is restricted to the Accounts Payable personnel with access to
process invoices against purchase order, since this system is used to generate payments, access is
restricted to all the payment screens.

Accounts Payable is an accounting entry that represents an entity's obligation to pay off a short-
term debt to its creditors. The accounts payable entry is found on a balance sheet under the heading
current liabilities. The Accounts payable are debts that must be paid off within given period of time
in order to avoid default, for example, at the corporate level, Accounts payable refers to short-term
debt payments to suppliers and banks.

Accounts payable are those amounts of money that a business must put aside to be paid for ongoing
debts. Accounts payable is a term that refers to the money that a person or business must pay to its
creditors within a certain period of time. It is the unpaid invoices bills or statements for goods or
services rendered by outside contractors, vendors or suppliers, these debts often must be paid either
partially or in full each month. When someone pays his or her monthly electricity, telephone, cable
television and Internet Service Provider bills, for example, he or she is paying off his or her accounts
payable obligations. The term Accounts Payable also is the term that is used to refer to the unit
within an organization’s accounting department that manages these payments.

1.2 Financial Strengths of Afghan Telecom Corporation:

First, we look at the company's strengths. What does the company do well? What makes it better
than others? What does the company have, or do?

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Chapter One Introduction

These are important questions, and should include aspects of the company that made you conside r
it for investment in the first place. Look at branding, image, pricing power, size, market share,
financial position (balance sheet strength), etc.

Here are some Afghan Telecom Corporation strengths to look for;

 Balance sheet strength.

 Cash flows.
 Strong Relationship with Governmental Organization & will choose Afghan Telecom.
 Afghan Telecom offer cheaper price service.
 100 % Government owned mobile operator.
 A new Convergence Billing System to be deployed.

1.3 Financial Weaknesses of Afghan Telecom Corporation:

 Lack of new innovation or up gradation.
 Long bureaucratic procedures in financial works.
 Lack of qualified personnel.
 Limited Financial Resources.
 Low Marketing Expenses.
 Lower coverage or Limited Coverage.

1.4 Reasons of Having Internal Control Unit in Afghan Telecom:

INTERNAL CONTROLS:
Internal Controls for accounts payable should include signature requirements according to payment
amounts. Consider implementing several tiers of signature requirements, For example, you could
require an accounting manager’s signature for items of more than $5,000, an executive sign off for
items of more than $10,000 and dual signature requirement for payments of more than $25,000.
Match your signature requirements to your revenue totals and the susceptibility of your business to
fraud for maximum benefit. Afghan Telecom routine control procedures for accounts payable.
Include spot checks on individual payments to ensure accuracy, for example, review five payables
every day and check the payment amount and payee information and ensure that accounting records
have been completed correctly.

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Chapter One Introduction

During book closing procedure at the end of a month or financial period, include sign off procedures
for all accounts payable work including summary totals and account reconciliatio ns. Additiona lly,
keep a running report that monitors payment levels from accounts payable processing, if payment
levels suddenly increase or decrease, an automatic investigation into the causes can head off
potential problems.

The internal control unit ensures that a sound internal control environment is in place at the
organization, Accordingly, this unit performs the necessary coordination work in this regard,
assuring that activities are performed regularly, efficiently, effectively and in accordance with the
management strategy and policies of the organization and the applicable rules and regulatio ns,
additionally, it monitors the integrity and reliability of accounting and recording system.

In accounting and auditing, Internal control is defined as a process affected by an organizatio n's
structure, work and authority flows, people and management information system, designed to help
the organization accomplish specific goals or objectives, it means by which an organizatio n's
resources are directed monitored, and measured. It plays an important role in detecting and
preventing fraud and protecting the organization's resources.

1.5 Important Of Internal Control Unit:

Important of Internal Control Unit are as follow;

 Control Environment, influencing the control consciousness of its people.

 Risk assessment, the identification and analysis of relevant risks to the achievement of
objectives, forming a basis for how the risks should be managed.
 Information and communication systems or processes that support the identification, capture
and exchange of information in a form and time frame that enables people to carry out their
responsibilities.
 Control activities, the policies and procedures that help ensure management directives are
carried out.
 Monitoring processes used to assess the quality of internal control performance over time.

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Chapter One Introduction

1.6 Financial and Accounts Payable System Procedure:

Afghan Telecom Corporation is one of the Governmental Telecommunication entities and was
established in April 2006 to provide unified telecommunications services, Afghan Telecom
Corporation aims to provide superior connectivity solutions to the people of Afghanistan.

The traditional roles and responsibilities of finance department are important for the complete
operation of the business. However, most of the functions do not have a considerable strategic
importance. The most common function of the finance department comprises the documentatio n
and the controlling of incoming and outgoing cash flows as well as the actual handling of the cash
flows. These two parts played and still play a significant role inside the department, however, due
to the computer revolution it is mostly dealt with on computerized system (such as Tally Accounting
Software). The introduction of mass computer system has made the task less labor intensive and far
quicker, even real time. Cash flows can be displayed on an up to date basis every day, performance
can be analyzed and evaluated straight away. This gives the financial department and the senior
management useful tools to see how the company is performing at any given time the finance
department is also responsible for the payment of bills, wages and salaries. This as well has been
computerized. Wages and bills are paid through electronic system; both transactions are outgoing
cash flows, on the other hand, payments for goods or services sold will be accounted in this
department.
1.6.2Accounts Payable Procedures:
Accounts Payable procedures overview;

 Filling procedures.
 Purchase orders vouchers.
 Credit notes or refund Cheques.
 Description on cheque remittance.
 Control and register.
So, you ordered your goods, you received your goods, you checked the invoices to make sure they
marched what you actually originally ordered and received, some rules are as follow;

 Write or stamp on your document ‘entered or processed’ to show that they have been recorded
in the bookkeeping system.

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Chapter One Introduction

 File the invoices away, you can use an alphabetical concertina folder, or lever arch folder with
alphabet tabs. Label the folder ‘Unpaid Invoices’ Make sure you only use this folder for unpaid
purchases invoices so you don’t get mixed up with other paper work.
 After the end of the month you will receive a statement from each of your suppliers listing all
the purchases you made during the month.
 Take your invoices out of the concertina folder because now you are going to match them to
the statement. Make a tike on the statement next to the ones you have invoices for, and attach
them behind, if there are any purchases on the statement for which you do not have an invoice,
highlight it and phone the supplier for a copy. They will willingly trough one of email or fax,
because, of course, they will want their money! Never pay for an invoice that you do not have.
 Once the purchase invoice matching is complete, highlight the total owing then place them back
in the folder until you are ready to pay. You could double check that all the statements added
up, match the total tally on your spread sheet.

1.6.3Accounts Payable Functions:

 Check, verify and process invoices.
 Prepare payments for signature.
 Credit notes or refund cheques.
 Sort, code and enter accounts payable data.
 Analyze discrepancies and unpaid invoices.
 Maintain vendor files.

1.6.4Audit Review:
A statistical sampling of documents is reviewed for accuracy and compliance with AFTEL policies
and/or other regulatory requirements for reimbursements or payments to individuals. All documents
tagged by data entry must be fully reviewed.

As documents are placed on hold, the department representatives are contacted by the Accounts
payable auditors reviewing the document. On a weekly basis, the Accounts payable auditors review
the documents that are still on hold and follow up with departments regarding the resolution. On
monthly basis, the Audit supervisor review the documents on hold and a decision is made regarding
the status of the pending payment, so at the end approved documents are scheduled for payment.

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Chapter One Introduction

1.6.5Accounts Payable Audit Procedures:

Accounts payable is a critical portion of your financial records and can be subject to fraud without
careful reconciliation and oversight. Strong accounts payable audit procedures can ensure the
accuracy and timeliness of your bill payments. The best accounts payable audit procedures allow a
mixture of daily checks, routine internal controls and external audit procedures.

1.6.6Routine Procedures:
Accounts payable should be balanced daily to reconcile payments to recorded entries. Any
discrepancy between the total amount paid and the total recorded should be examined and
reconciled immediately. Management oversight of every individual involved in accounts payable
should be stringent and should include routine monitoring of activities. Managers should be trained
to watch for any signs of misconduct by accounts payable staff.

1.6.7Internal Controls:
Internal controls for accounts payable should include signature requirements according to payment
amounts. Consider implementing several tiers of signature requirements. For example, you could
require an accounting manager's signature for item of more than $5,000.00, an executive sign- off
for items of more than $10,000.00 and dual signature requirement for payment of more than
$25,000.000, Match your signature requirements to your revenue totals and the susceptibility of
your business to fraud for maximum benefit.
Afghan Telecom routine control procedures for accounts payable, include spot checks on individ ua l
payments to ensure accuracy. For example, review five payables every day and check the payment
amount and payee information and ensure that accounting records have been completed correctly.

1.6.8External Control:
Most external audits include accounts payable as a testing area. External audits should take a
detailed accounts payable listing and trace totals from the details through all accounting records to
the summary total and should include the bank withdrawals.

1.6.9Accounts payable Audit:

A systematic, proven process is followed throughout the audit to assure comprehensive, effic ie nt
recovery of claims. At every point, clients can view audit status via a graphical, web-based tool.

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Chapter One Introduction

From long time, Accounts payable recovery audits have focused on loss detection and recovery,
and learned how to prevent losses from happening in the first place.

Clients can access information on the progress of their audit including;

 Statement, duplicate and other claims to date.

 Detail of statement claims and duplicate claims by vendor.
 Breakdown of recoveries in graphical format.
 Audit timeline and deliverable timeline.
Our people are called audit advisors for a reason, they function as your partner and your advocate,
acting as an extension of your company in all vendor interactions and assisting in the
implementation of best practices. In fact, our audit advisors are compensated for client satisfactio n
and quality of work, which means they only submit quality claims for potential recovery, resulting
in less work and better relations with both your staff and your vendors.

1.7 Job Description of Accounts Payable Manager:

 Prepare and make vouchers, petty cash, bank transfer, contracts, and bank receipts.
 Keep track of all daily cash book and safe.
 Operating all these transactions in Tally Accounting Software.
 Process request for direct payments, ensuring the presentation of the relevant supporting
documents.
 Process request for advance payments and ensure timely and proper presentation of the
corresponding financial reports.
 Collecting information from Mili Bank, Azizi bank and Kabul Bank through their websites
for the Account Balance.
 Present the report of the balance to Organization.
 Process and routine observation of the salary payments of staff members from differe nt
departments of the company.
 Money transfer to the Accounts of the related provinces for the monthly salary.
 Present the report of the salaries to the CEO of the Company.

1.8 Research Questions:

1. What are the strengths of Afghan Telecom Corporation?

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Chapter One Introduction

1.9 Research Objective:

Following are the major objectives of this research;

 To find strengths, and weaknesses..

 To find the major reason of having the internal control unit in Afghan Telecom Corporation
and their importance.
 To Examine accounts payable, Accounts payable process, Accounts payable audit, and
Accounts payable invoices.

1.10 Significance of Research:

This research is much important for me in order to give an overview of the financial system of
Afghan Telecom in Afghanistan and this research report will enable the finance department of
Afghan Telecom to know more about the strengths and weaknesses of their company in particular,
so as to work more about the weaknesses of the company and increase the performance level of the
company.

1.11 Scope of Research:

The scope of this research is just Afghan Telecom headquarters finance department and Accounts
payable departments.

1.12 Scheme of Research:

The research report has been divided into five chapters regarding different topics.

 Chapter One: The overview and background of the study in order to create an interest of
the readers to further continue the study.
 Chapter Two: is specified for Literature review.
 Chapter Three: Comprises research methodology and design.
 Chapter Four: Covers the Finding & Analysis of the Thesis.

 Chapter Five: This chapter contains the discussion, conclusion, and recommendation of
the research.

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Chapter Two Literature Review

CHAPTER TWO
LITERATURE REVIEW
Literature Review:
2.1 CFO research service. (March 2008):
On March 2008, so according to them in recent years, CFO research service has documented finance
efforts to drive cost, complexity, risk and error from its routine transaction processes. We have
found that streamlined business processes, often paired with improved technology systems for
transaction processing, are the foundation of many of these efforts. Our survey of senior finance
executive in North America explores finance executives interests, problems, and plans in the
management of Accounts Payable.
How well are companies performing in accounts payable? Survey results show that, in general,
companies are executing basic accounts payable activities well. Good performance in basic
activities like receiving invoices, reconciling them with purchase orders, and issuing payments is
certainly to be expected; companies that execute the basics of Accounts payable very poorly
probably would not expect to remain in business for long. But finance executives see room for
improvement in their companies, Accounts payable performance, not only for higher value
activities such as producing information to support decision making and timing payments
optimally, but also for activities such as matching payments to contract terms, directing payments
to the right places and accounts, and documenting transactions.
How serious are shortfalls in accounts payable performance? We sought to gauge the broader
impact of problems in accounts payable by asking respondents to estimate the degree of risk
associated with Accounts payable, these risks appear to be particularly acute when dealing with
external suppliers.
Finance executives responding to our survey also found a note of caution: Be careful, they write,
note to sacrifice control for cost savings. "You can't minimize cost at the risk of following lax
controls," a respondent writes. At the same time, other open-ended responses suggest a differe nt
warning: Complete control (and a corresponding elimination of risk), they write, comes at the cost
of efficiency.

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Chapter Two Literature Review

2.3 Rochester Institute of Technology on (Sep 2008 ).

Accounts payable staff process all non-payroll disbursements through the Oracle Accounts payable
application, including purchase order payments, invoice payment forms, travel and other employee
reimbursements and stipend payments made to graduate research assistants. In addition, Accounts
Payable staffs prepare and distribute 1099 forms to individuals receiving payments from Rochester
Institute of Technology (RIT) for services.
Also according to them Accounts Payment forms are used to request payments for goods and
services not purchased on a purchase order, or When an Invoice Payment forms is received in
Accounts Payable, an authorized signature form must be on file for the approver, the "Business
purpose" field must be completed in full and supporting information such as an original supplier
invoice must accompany the form.
After that they put Accounts payable check processing schedule it means Accounts Payable staff
processes payments to suppliers each Monday and Wednesday

Evening, checks are mailed on Tuesdays and Thursdays.

2.4 According Petersen and Rajan (1997),

Purchase made on account as a proxy for the quantity of trade credit offered to the firm. Their
sample consists of small firms some of which may be credit rationed by suppliers. Since our Sample
firms are larger firms we make an assumption that all purchases are on credit and use their annual
purchases as a proxy for the supply of trade credit. We believe that this assumption is not very
restrictive, since large firms typically don’t pay their purchases in cash. In measuring the supply of
trade credit we have an advantage over previous research since we know the exact amounts of the
sample firms’ annual purchases. Petersen and Rajan had to Estimate the amount of purchases to
measure supply of trade credit since U.S. firms do not provide information on the division of cost
of goods sold into different cost categories such as wages and purchases.

2.5JYRKINISKANEN & MERVINISKANEN on (2009)

JYRKINISKANEN is professor of accounting, University of Tampere & MERVINISKANEN is
researcher in Helsinki School of Economics and Business Administration, so According to them,
this study empirically examines the determinants of finished listed firms' accounts receivable and
accounts payable. The results show that accounts receivable are most likely to be affected by the

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Chapter Two Literature Review

firms’ incentive to use trade credit as a means of price discrimination. Increases in the interest rate
level also increase the amount of accounts receivable through increased demand for trade credit.

The most important determinants for the level of accounts payable appear to be the supply of trade
credit, firm size, interest rate level, the ratio of current assets to total assets, and insufficient interna l
financing.
At the end and Conclusion of this research, Market cost of capital also has an effect on their level.
The latter result may be largely explained by increasing demand of trade credit when market interest
rates rise. All the variables that were used to explain the level of accounts payable were statistica lly
significant although their signs were not always expected. The results show that the most important
variables behind accounts payable policies are supply of trade credit, firm size, level of interest
rates, asset maturity and internal (insufficient) financing.
2.6 Porshia Russell (2010),
In order to process payments the following documents are required; an invoice, receipt, or
equivalent documentation for expenditures that includes the amount, date, place, business
relationship, purpose, and parties involved where applicable.

When research Accounts payable has receiving information, and invoices matched directly to a
purchase order these items will be processed daily. Invoices over $ 5,000.00 require approval of
project Director.

Also they use Blanket Purchase Orders &Departmental Purchase Orders, A specified amount is set
up by the department to a specific vendor, and supplies called in as needed. When invoices are
received in Accounts payable, they are sent to the department for approval via e-mail or Fax to
expedite processing.

Departmental purchase order, when They are given to departments in Pre-numbered Groups, by the
office of Grants Management to be used by departments for emergency items, which are needed
immediately and are under $1,000.00; the department calls the order in to the vendor directly, and
then sends the completed paperwork to Grants management for signatures. Once Accounts payable
receives the invoice, and receiving information, payment processed, Also field expenses are a
spreadsheet listing the expenses, and supporting documentation. In case where receipts cannot be
obtained due to extenuating circumstances, a journal listing of expenses is acceptable .

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Chapter Two Literature Review

2.7Pending Transaction Clean-up, Columbia University,

Accounts Payable (AP) is responsible for the processing of: Vendor invoices for goods and
services; Prize, award, royalty, select fellowship and various other payments; Credit balance
refunds for various accounts; Expense reimbursements for University employees; and Petty cash
account replenishments.
To ensure that open procurement transactions that have been in pending status for an extended
period of time are removed from the system in a timely manner (either through processing or
cancellation), a quarterly review process is undertaken by the Procurement team. This process helps
improve overall system functionality by reducing the number of abandoned, stale transactions that
are included in system queries and batch processes.

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Chapter Three Research Methodology

CHAPTER THREE
RESEARCH METHODOLOGY
Research Methodology
Quantitative research
Quantitative research is generally associated with the positivist/postpositivist paradigm. It usually
involves collecting and converting data into numerical form so that statistical calculations can be
made and conclusions drawn.

The process
Researchers will have one or more hypotheses. These are the questions that they want to address
which include predictions about possible relationships between the things they want to
investigate(variables). In order to find answers to these questions, the researchers will also have
various instruments and materials (e.g. paper or computer tests, observation check lists etc.) and a
clearly defined plan of action.
Data is collected by various means following a strict procedure and prepared for statistical
analysis. Nowadays, this is carried out with the aid of sophisticated statistical computer packages.
The analysis enables the researchers to determine to what extent there is a relationship between two
or more variables. This could be a simple association (e.g. people who exercise on a daily basis
have lower blood pressure) or a causal relationship (e.g. daily exercise actually leads to lower blood
pressure). Statistical analysis permits researchers to discover complex causal relationships and to
determine to what extent one variable influences another.
Qualitative research

Qualitative research is the approach usually associated with the social constructivist
paradigm which emphasises the socially constructed nature of reality. It is about
recording, analysing and attempting to uncover the deeper meaning and significance of
human behaviour and experience, including contradictory beliefs, behaviours and
emotions. Researchers are interested in gaining a rich and complex understanding of
people’s experience and not in obtaining information which can be generalized to other
larger groups.

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Chapter Three Research Methodology

The Process
The approach adopted by qualitative researchers tends to be inductive which means that they
develop a theory or look for a pattern of meaning on the basis of the data that they have collected.
This involves a move from the specific to the general and is sometimes called a bottom-up approach.
However, most research projects also involve a certain degree of deductive reasoning (see section
on quantitative research for more details).

Qualitative researchers do not base their research on pre-determined hypotheses. Nevertheless, they
clearly identify a problem or topic that they want to explore and may be guided by a theoretical lens
- a kind of overarching theory which provides a framework for their investigation.

The approach to data collection and analysis is methodical but allows for greater flexibility than in
quantitative research. Data is collected in textual form on the basis of observation and interactio n
with the participants e.g. through participant observation, in-depth interviews and focus groups. It
is not converted into numerical form and is not statistically analysed.

3.1 Research Approaches:

The research approach for this study is quantitative and qualitative research approaches. This
research is based on quantitative and qualitative data analysis.

3.2 Types of Data:

This research is based on primary and secondary sources Data .

3.3 Population:
The target population for this study consists of a telecommunication industry in Afghanistan.

3.4 Sample:
As a sample I have selected Afghan Telecom Corporation.

3.5 Sampling Technique:

I have used probability sampling method where I have selected simple random sampling technique
for collection of data.

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Chapter Three Research Methodology

3.6 Limitation of Study:

Time Constraints: time is a dimension in which events can be ordered from the past through the
present into the future, and also the measure of durations of events and the intervals between them,
Time has long been a major subject of study in this thesis.

Availability of data: this research is based on primary & secondary data, In order to get reliable and
accurate data, I used a questionnaire, and the questions were answered by the use of tick in the
provided space or Box

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Chapter Four Discussion and Analysis of the Findings

CHAPTER FOUR
DISCUSSION AND ANALYSIS OF THE FINDINGS
Discussion and Analysis of the Findings
4.1 Overview
This chapter mainly deals with discussion, presentation, questionnaire and analysis of findings from
the study entitled causes, effects and solutions of having the internal control unit in Afghan Telecom
Corporation and Important of Internal Control unit on Accounts Payable system of Afghan Telecom
Corporation

4.1 Demographic Characteristics of the respondents

Table 1: Classification of the Gender

Gender Frequency Percentage
95%
Male 19
5%
Female 1

Figure 1:

Gender

5%

Male
female

95%

Source: AFTEL Corporation

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Chapter Four Discussion and Analysis of the Findings

The questionnaire was distributed to 20 employees; the table above indicates that more males than
females were involved in the study at a percentage of 5% whereas females formed only 95%. There
were more male respondents in the study than females

4.2 Respondents Categorized by age

Table 2: Age
Age group frequency Percentages
20-25 6 30%
26-35 10 50%
36-45 4 20%

Figure 2:

Age catagory

20%
30%
Age group
20-25
26-35
36-45

50%

Source: AFTEL Corporation

The questionnaire was distributed to 20 employees, the above bar graph indicates that only (30%)
of the respondents were within the age group of 20-25, (30%) of the respondents were within the
age group of 26-35, and (50%) of the respondents were within the age group of 36-45were (20%).

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Chapter Four Discussion and Analysis of the Findings

4.3 Which Department do you work in?

Table 3: Department
Which Department do you work in? Frequency percentages
Finance 11 55%
Admin 4 20%
Marketing 2 10%
HR 1 5%
IT 2 10%

Figure 3:

Department

10%

5%
which Department do youwork in?

10% Finance
Admin
Marketing
55%
HR
IT
20%

Source: AFTEL Corporation

The questionnaire was distributed to 20 employees; out of these 11 employees 55% of the
respondents work in Finance department, 10% work in marketing department 10% work in IT
department 20% Admin and 5% HR Department.

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Chapter Four Discussion and Analysis of the Findings

4.4 Which procedure is/Are following in AFTEL Accounts Payable

Department?
Table 4: Procedure of Afghantelecom

Which procedure is/Are following in AFTEL Accounts Payable Percentage

Department? Frequency s
Manual 3 15%
Computerized 4 20%
Manual& computerized 13 65%

Figure 4:

Procedure of AFTEL

15%

Manual
20% Computerized
Manual& computerized

65%

Source: AFTEL Corporation.

The Upper chart shows that Answer of Bureaucratic 15% Computerized 20% and the remaining
Manual and computerized were 65 %.

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Chapter Four Discussion and Analysis of the Findings

4.5 What will be the strength of Afghantelecom?

Table 5: Asking of strength of Afghantelecom

What will be the strength of Afghantelecom? Frequency Percentages

Providing the cheaper prices 13 65%
Good relationship with external Agencies 3 15%
High coverage 4 20%

Figure 5:

Strengthnes

20%
Providing the cheaper prices

Good relationship with external

15% Agencies

65% High coverage

Source: AFTEL Corporation.

Questionnaires distributed to 20 persons about strengthens of Afghantelecom which the most votes
went to Providing cheaper prices 65% Good relationship with external Agencies 15% and higher
coverage takes 20%.

4.6 When AFTEL financial system control by Audit?

Table 6: Audit System
when AFTEL financial system control by Audit? Frequency Percentages
Every Quarter 1 5%
Every month 2 10%
Once in a year 14 70%
Continuously 3 15%

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Chapter Four Discussion and Analysis of the Findings

Figure 6:

Audit System

5%
15%
10%

Every Quarte
Every month
Once in a yar
continuously

70%

Source: AFTEL Corporation.

Table shows that Questionnaire Asked about Audit System of Afghantelecom the most Staff Agreed
for once in a year shows 70% every quarter shows 5% Every months shows 10% And continuo us ly
shows 15% votes.

4.7 Is (GAAP) Applying in AFTEL Finance Department?

Table 7: (GAAP) generally accepted accounting Principles

Is (GAAP) Applying in AFTEL Finance Department? Frequency Percentages

Completely 5 25%
Seldom 9 45%
NO 6 30%

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Chapter Four Discussion and Analysis of the Findings

Figure 7:

(GAAP)

25%
30%

Completely
Seldom
NO

45%

Source: AFTEL Corporation.

Surly there in AFTEL using (GAAP) but may or may not the respondents of other departments
don’t know about this terminology graph showing 25% completely 45% Seldom and 30% NO.

4.8 Is the AFTEL finance Reporting System based on (IFRS)?

Table 8: Reporting System Based on (IFRS)

Is the AFTEL finance Reporting System Based on (IFRS)? Frequency Percentages

Yes 7 35%

NO 13 65%

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Chapter Four Discussion and Analysis of the Findings

Figure 8:

IFRS

35%

Yes
NO

65%

Source: AFTEL Corporation.

Questioners distributed to 20 persons about Applying (IFRS) system in finance Department of

Afghantelecom graph showing 35% yes and remaining 65% no

4.9 How is the effectiveness of the TALLY using in finance Department?

Table 9: Effective of MIS (Tally) software

How is the effective of the TALLY using

Frequency Percentages
in finance Department?
High 4 20%
Good 15 75%
fair 1 5%
Not good 0 0%

24
Chapter Four Discussion and Analysis of the Findings

Figure 9:

TALY
0%

5%
20%
High
Good
fair
Not good

75%

Source: AFTEL Corporation.

TALY is a software referring to MIS using in finance Department of Afghantelecom the

satisfaction of finance and other Department showing 75% good, 20% high, 5% Fair and finally
0% Not good.

4.10 Does finance Department allocate fair budget for its development and
expenses projects?
Table 10: Budget inquiry

Does finance Department allocate fair budget for

Frequency
its development and expenses projects? Percentages
Yes 13 65%
NO 7 35%

25
Chapter Four Discussion and Analysis of the Findings

Figure 10:

Budgeting

35%
Yes
NO
65%

Source: AFTEL Corporation

Questions distributed to 20 persons showing 65 % yes and 35% no in this graph.

4.11 Do you have any unclear Dues with finance Payable section?
Table 11: staff payment clearances

Do you have any unclear Accountability with finance Payable section? Frequency Percentages
Yes 6 30%
NO 14 70%

Figure 11:

clearances

30%
Yes
NO

70%

Source: AFTEL Corporation.

26
Chapter Four Discussion and Analysis of the Findings

Afghan telecom sometimes offering loans to its Needy staffs so here asking whether they paid their
installments as per contracts signed Or cash is issuing to procurement cashier to purchase urgent
and requested Assets so from 20 persons 30% person of them is did not clearer and 70% of them
cleared their Dues.

4.12 How is the communication between finance and other Department?

Table 12: communication between finance and other Department

How is the communication between finance and other Department? Frequency Percentages
Strong 6 30%
Good 11 55%
Weak 3 15%

Figure 12:

Communications

15%

30%

Strong
Good
weak

55%

Source: AFTEL Corporation.

In this question Asked About communication between finance, HR , Admin, IT and marketing
Department the Answer shows 30% Strong 55% good and 15% weak.

27
Chapter Four Discussion and Analysis of the Findings

4.13 How is the coordination between finance staffs?

Table 13: coordination between finance staffs

How is the coordination between finance staffs? Frequency Percentages

Strong 6 60%
Fair 1 10%
Good 2 20%
Weak 1 10%

Figure 13:

Coordination

10%

20% Strong
fair
Good

60% weak

10%

Source: AFTEL Corporation.

Coordination is the most importing thing between internal and external users of anOrganiza tio n
here asked from afghan telecom different Staffs showing 60% strong,10% fair,20% good and 10%
weak.

28
Chapter Four Discussion and Analysis of the Findings

4.14 Do you apply proper coding System in your Documentation process?

Table 14: coding System

Do you apply proper coding System in your Documentation process? Frequency Percentages
Yes 6 50%
NO 6 50%

Figure 14:

coding System

Yes
50% 50%
NO

Source: AFTEL Corporation.

These two questions referring to finance department shows 50% Yes and 50% NO.

29
Chapter Four Discussion and Analysis of the Findings

4.15 Are there regular chart of Accounts in your system?

Table 15: regular chart of Accounts

Are there regular chart of Accounts in your

system? Frequency Percentages
Yes 4 40%
NO 6 60%

Figure 15:

regular chart of Accounts

40%
Yes
NO
60%

Source: AFTEL Corporation.

40% of finance Staff Says that there is Regular Chart of Accounts and the rest 60% says not
regularity in Chart of Account By an interview will clear these irregularities.

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Chapter Five Conclusion & Recommendations

CHAPTER FIVE
CONCLUSION & RECOMMENDATIONS
Conclusion & Recommendations:
5.1 Overview:
This Chapter concludes the whole study based on real data analysis and point out the main
findings, and further we have given recommendation for improvements based on data analysis.

5.2 Conclusion:
The purpose of this research is to provide information about Accounts payable system of Afghan
Telecom Corporation, the office of Accounts payable is responsible for ensuring that all payment
for the contractor are processed in accordance of policies and procedures.
For this purpose the questionnaire was distributed to 20 employees; more than 30% of the
respondents believe that not regularities of “GAAP” there, the major factors of Accounts payable.
While the 70% percentage of other respondents believes that it's the Analysis discrepancies and
unpaid payments, and 65% of the respondents voted to prepare payments for good budgeting, and
the remaining 35% of employees were off the opinion is Not, code and enter Accounts payable data
in the system that is not following “GAAP”

And also for the purpose of an effective internal accounting control over Accounts payable 70% of
the respondents believe that only Auditing Manually, while 30% of the respondent voted to the not
or disagree.
Three questions among the Questioner were especially for finance Department Staffs about regular
chart of accounts communication and proper coding System so, there Are Different Answers About
three impertinent Questions the conclusion of these three questions Are generally the Strong voted
are negative there are not good communication, proper coding system and not regular chart of
Account. Although the questioners are not distributed to junior of other departments because the
seniors of other departments are aware about accounts payable Department.
5.3 Recommendations:
Indeed in this recommendation portion the researcher will try to give the best suitable
recommendation on the basis of facts & realities of this research reports.
All the recommendations are as follow;

31
Chapter Five Conclusion & Recommendations

 The company must start work on implementation of the standard rules and regulation of the
financial department in order to compliance the financial processes in line with the
requirement of generally accepted accounting principle (GAAP) rather than considering only
the TALLY software and experienced employees.
 The company management must focus more on the standard financial rules and regulation,
and using the mentioned software, because following standard rules and regulation, it trains
the employees of the company that what and how to do the work.
 The company should assign the responsibility to the employees whose are able to fulfill it.
 The management of the company must focus on having internal control unit in their
organization by all their financial processes will be totally in line with the requirement of
generally accepted accounting principle “GAAP”.
 Through this research report I am strongly recommending management of the company that
they should have the expert and specialist employees in the financial unit so as to improve the
financial management affairs.
 The company should make a strong relation among Departments and make the Staff of finance
expert in their duties.
 A regular coding system is required.
 The documentation process after paid should be accomplished and make regular files Archived
in order to be ready for audit.

32
 Reference:

 Jyrkiniskanen&Mervinikaven, 2009,“Examine the determinants of firms Accounts payable”.

 CFO, 2008, “An overview of Accounts payable system. Research services”.
 Porshia Russell, 2010, “Process of Accounts payable, Stony Brook University.
 America”.
 Moussa, A. and R. Schware, 1992, “Informatics in Africa: Lessons from World Bank
Experience” World Development, Vol. 20, pp.1737–52.
 Murphy, P., 2002, “Road Map for Implementation of an Integrated Financial Management
(Accrual Based) System in a Developing Country Environment,” (mimeo).
 Peterson, S.B., 1993, Making it Work: Implementing Effective Financial Information Systems
in Bureaucracies in Developing Countries,” Development Discussion Paper No. 447, HIID, pp.
1–26.
 Peterson, S., C. Kinyeki, J. Mutai, and C. Ngungu, 1996, “Computering Accounting Systems in
Developing Bureaucracies: Lessons from Kenya,” Public Budgeting and Finance, Vol. 16(4)
winter, pp. 45–58.
 Rochester Institute of Technology, 2008, “Report on the view of Accounts payable process”.

Websites
 http://www.miami.edu/index.php/hr/HR_systems/UMSYS/purchasing_and_accounts_payable_
systems/accounts_payable_system/
 http://www.investopedia.com/terms/a/accountspayable.asp
 http://www.britannica.com/EBchecked/topic/3037/account-payable
 http://www.accountspayable.co.uk/resources/books.php
 www.afghantelecom.af

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