Abstract
Institutions globally have embraced electronic systems of managing documents and generation of financial statements ranging from maintenance of ledgers, extraction of the trail balance and automated income statement and statement of financial position. This study sought to analyze the effect of e-financial documentation and statements on operating costs in universities in Kenya. The study was guided by theory of reasoned action and technology acceptance model. The target population was 80 employees drawn from 8 universities, four public universities and four private universities operating in Mount Kenya region. Census was used to collect the data from target population. A self-administered semi-structured questionnaire was distributed to the target population. A total of 71 questionnaires were returned giving a response rate of 88.75%. Statistical package was used to undertake descriptive and inferential statistical analysis. Descriptive analysis was done using both means and standard deviations. Bivariate linear regressions were used to assess the effect of e-financial documentation and statements on operating costs. Model R2, ANOVA Statistics (F Statistic and associated p-value) and regression coefficients (Beta and associated p-value) were generated and interpreted. The Bivariate results indicated that online financial documentation have a significant effect on the operating cost of universities. Electronic financial statements had an insignificant effect on operating costs of universities. This study concludes that online financial documentation affects organization costs in the universities. The study recommends the need to sensitize management of universities and other organizations on the importance of electronic financial services because they could reduce operating costs.
Highlights
Background of the Study Bushman and Smith (2001) assert that a fundamental objective of governance research in accounting is to provide evidence on the extent to which information provided by financial accounting systems mitigate agency problems due to the separation of managers and outside investors, facilitating the efficient flow of scarce human and financial capital to promising investing opportunities
The results show that the R value was 0.371 indicating that there is a slight positive relationship between online financial documentation and operating cost in universities in Kenya
Based on the study findings, the study conclude that electronic financial documentation was found to be statistically significance and had an influence on the operating cost
Summary
Background of the Study Bushman and Smith (2001) assert that a fundamental objective of governance research in accounting is to provide evidence on the extent to which information provided by financial accounting systems mitigate agency problems due to the separation of managers and outside investors, facilitating the efficient flow of scarce human and financial capital to promising investing opportunities. Manual accounting implies that employees perform the whole accounting cycle manually on a periodic basis: they calculate trial balances, journalize transactions, and prepare financial statement reports and other routines which it takes much time, resources and effort in large organizations than electronic financing. World Bank (2000) noted that electronic accounting began around 1930 with adding machines and basic computers performing computerized mathematical functions in early 1930s. By the end of 1990s, e-finance technologies affected all aspects of the business of banking and financial intermediation. McAndrews, and Stratran (2002) defined e-finance as the provision of financial services and markets using electronic communication and computation. Shahrokhi (2008) defined electronic financial transaction as a transaction that depends on the internet or a similar network to which households or non-financial enterprises have access to bank. That e-finance has great potential to improve the quality and scope of financial services and expand opportunities for covering trading risks and can widen access to financial services for a much greater set of retail and commercial clients by offering more cost-effective services
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