INFORMATION TECHNOLOGY USAGE AND QUALITY OF FINANCIAL REPORTING IN COMMERCIAL BANKS IN UGANDA
Ssebalamu Andrew
Corresponding Author
Faculty of Business Administration& Management, Ndejje University.
Ampereza Milton
Corresponding Author
Faculty of Business Administration& Management, Ndejje University.
Oroma Annabella Asedri
Corresponding Author
Faculty of Business Administration& Management, Ndejje University.
Organizations use accounting information to make decisions, and the information needs vary according to information of each user. As information technologies grow progressively in public and private sector firms in Uganda; ICT is used as a vehicle to ensure effective and efficient information. In 2015, commercial banks encountered delays in the delivery of the financial year reports and this situation is being experienced to date. Several studies have been carried out on information technology usage; however few studies have been carried out on information technology usage and quality of financial reporting in commercial banks.
The study used a cross sectional survey design, targeting a population of 45 employees from which a sample of 40 respondents was randomly selected; Human Resource Managers (n= 3), Accountants (n= 11), Bankers (n=24) and IT managers (n=2). The structured self-administered questionnaires were administered to respondents, and 12 in-depth key informant interviews were conducted. Results on all the three aspects revealed positive significant relationships between; data storage and quality of financial reporting (r=0.385*; p=0.014); applied software and quality of financial reporting (r=0.928***; p=0.002) and information technology personnel and quality of financial reporting (r=0.624***; p=0.000).
Qualitative results revealed that financial reports are not stored on computers, and financial information stored on computer disks was not easily accessed during financial reporting. Computer software were not regularly updated. In conclusion, information technology usage significantly affects quality of financial reporting. All the three aspects are predictors of quality of financial reporting.
Therefore, banks needs to adopt a culture of utilizing computerized accounting systems to achieve easy preparation of quality financial reports, acquiring computerized accounting software that suit the organizational needs, training the staff so as to improve the accuracy and speed in posting. The company needs more internal audit reviews to appraise and check the strength of the instituted controls within the system.
The study used a cross sectional survey design, targeting a population of 45 employees from which a sample of 40 respondents was randomly selected; Human Resource Managers (n= 3), Accountants (n= 11), Bankers (n=24) and IT managers (n=2). The structured self-administered questionnaires were administered to respondents, and 12 in-depth key informant interviews were conducted. Results on all the three aspects revealed positive significant relationships between; data storage and quality of financial reporting (r=0.385*; p=0.014); applied software and quality of financial reporting (r=0.928***; p=0.002) and information technology personnel and quality of financial reporting (r=0.624***; p=0.000).
Qualitative results revealed that financial reports are not stored on computers, and financial information stored on computer disks was not easily accessed during financial reporting. Computer software were not regularly updated. In conclusion, information technology usage significantly affects quality of financial reporting. All the three aspects are predictors of quality of financial reporting.
Therefore, banks needs to adopt a culture of utilizing computerized accounting systems to achieve easy preparation of quality financial reports, acquiring computerized accounting software that suit the organizational needs, training the staff so as to improve the accuracy and speed in posting. The company needs more internal audit reviews to appraise and check the strength of the instituted controls within the system.