Adoption of Computerized Accounting Information System And Financial Performance of Metropolitan, Municipal And District Assemblies in Ghana: the Role of Internal Control Systems

Abstract

ABSTRACT The aim of this study is to explore the factors that influence the adoption of computerized accounting information system (CAIS) among MMDAs in Ghana. It also sought to examine how the identified factors influence the financial performance of the MMDAs and the mediating role of internal control system in the identified linkage. Relying on data collected from the operators and controllers of CAIS of 227 MMDAs across the sixteen regions of Ghana using questionnaire as the main instrument, factor analysis was applied to identify four factors that determine the adoption of CAIS among MMDAs. These include; Cost of adoption; CAIS complexity, Data security and cost and then Readiness to adopt CAIS. Using these factors as exogenous constructs and applying structural equation modelling, the study observed that, whiles cost of adopting CAIS and readiness to adopt CAIS significantly influence the financial performance of MMDAs, CAIS complexities and data security cost and threat have no significant influence on financial performance. It was again observed that whiles internal control system mediates the relationship between CAIS complexities and financial performance, and then data security threat and cost, internal control system does not mediate the relationship between cost of adopting CAIS and financial performance and then readiness to adopt CAIS and financial performance. It is recommended among others that Government interventions should aim at improving technology adoption among MMDAs. Also, Government should speed up the adoption and implementation of GIFMIS to cover all MMDAs. Again, MMDAs should consider CAIS technology on the basis of Software-as-a-service (SaaS).