DETERMINANTS OF COMPUTERIZED ACCOUNTING INFORMATION SYSTEM ADOPTION BY HOSPITALS IN ADDIS ABABA, ETHIOPIA

Abstract

The purpose of this study is to analyze factors that have an effect on the adoption of computerized accounting information system by hospitals in Addis Ababa. It examines the effect of cost-benefit perception, perceived ease of use, human resource, firm size and management commitment on computerized accounting information system adoption. The study adopts explanatory research design along with census survey of all of 52 hospitals in Addis Ababa. Primary data was collected from these hospitals. The main findings indicate that adoption of computerized accounting information system is significantly affected by perceived ease of use, human resource and management commitment. Furthermore, cost-benefit perception and firm size are not significantly related to adoption of computerized accounting information system. The study recommends that hospitals should attempt to employ qualified and competent personnel; accounting information system vendors should provide packages that are easy to use and management to support accounting information system implementation. Keywords: Computerized accounting information system, perceived ease of use, Addis Ababa 1. Introduction It has frequently been said that accounting is the language of business. If that is the case, then an accounting information system is the intelligence or the information providing vehicle of that language. Accounting information system is a system that gathers, records, stores, and processes data to produce information for decision makers. (Romney and Steinbart, 2012) Nicolaou (2000) defined Accounting information system as a computer-based system that processes financial information and supports decision tasks in the context of coordination and control of organizational activities. An accounting information system can be either manual system or a computerized system that use information technology or something in between. The procedure is the same without regarding the approach taken. Accounting information system must gather, enter, process, store and report financial information. The manual or computer hardware and software are the tools used to produce the information (Romney and Steinbart, 2012). Computerized accounting information systems have replaced manual-based accounting system in virtually all businesses and organizations giving accountants, managers, employees and stakeholders' access to important accounting information (Albright 2006). According to Gwangwava et al (2012), computerized accounting system has three main advantages than manual accounting system: computerized systems automate and simplify the process of recordkeeping, allowing all transactions to be recorded in electronic format and posted automatically to ledger; computerized accounting systems are more accurate, make fewer mistakes than manual accounting systems; and computerized accounting systems are real time and provide updated information on account balances and the status of accounts. As we live in the age of technological advancement, the role of computerized accounting information systems is of greater importance in managing an organization and implementing internal control systems. Accounting information systems allows a company to manage its business with potential benefits of improved process flow, reduced inventories, better data analysis and customer service, and increased profit margins (Gwangwava etal, 2012). The significance of accounting information system in the economy of a nation has been recognized universally, particularly in the contribution to the economic management of developing economy, where the contribution of accounting information system towards growth, creating job opportunity and social progress is highly important. The role played by accounting firms has been enhanced by the development of accounting information system, which has contributed to the professional values added to these organizations (Laudon, 1991). Truth to be told, computerized accounting information system employed by software experts to process accounting information systems with a good support of financial statements have reduced the human error factor, compared to manual systems (Dalci and Tanis, 2009). Accounting information system also provide information on actual budgets of the organization that will help the company's management to plan and control business operations ,but an appropriate framework that determine the usage and impact of accounting information system is yet to be determined. According to Ahmed et al (2016), accounting information system is beneficial and valuable to the all types of business regardless their size, it can provide help during all the process of decision making and enhance business performance and strategies. Consequently, many organizations should adopt and