The Impact Of Accounting Information System On Effectiveness Of Manufacturing Firms In Kenya

Abstract

Accounting processes have moved from manual process to being automated. Economic competition has created a lot of pressure on the cost of information which a company needs to access and utilize during decision making. The objective of the research aimed to carry out a study on how manufacturing firms in Kenya utilize accounting information technology in their financial reporting process. The research analyzed how Accounting Information System (AIS) affect manufacturing firm’s effectiveness. The study adopted descriptive design of study and Questionnaires were used to collect data which was presented to managers and senior accountants. Data collected was presented in the form of tables and graphs. The sample of the study consisted 51 manufacturing companies in Kenya selected through non-proportional quota sampling technique. Data collected was analyzed using Microsoft Excel and Correlation and regression analysis was used to analyze the data. The study found that there exist a positive relationship between accounting information systems and organization efficiency. The results are consistent with empirical reviews which indicated that there exist a relationship between AIS and organizational performance. The study concluded that accounting information system has an impact on the efficiency of manufacturing firms in Kenya in terms of effective management, decision making and controlling operations. The key recommendation of this study is that manufacturing companies desiring to increase their efficiency in terms of profitability and adaptability to market changes can achieve that by investing in a good accounting information system in their financial accounting processes.