COMPUTERIZED ACCOUNTING INFORMATION SYSTEM ADOPTION AMONG SMALL AND MEDIUM ENTERPRISES IN ADDIS ABABA, ETHIOPIA

Abstract

This article presents the results of a study conducted to examine the extent of computerized accounting information system (CAIS) adoption among small and medium enterprises (SMEs) in Addis Ababa, Ethiopia and to determine its influencing factors. Using a questionnaire survey, data was collected from 300 firms to validate the proposed technological, organizational and environmental (TOE) framework model. Findings showed that the CAIS adoption levels among SMEs varied. Of the total firms enrolled, 31 % of SMEs were using fully CAIS while the rest 69 % of them were using a combination of manual AIS and CAIS (referred as partial CAIS). Furthermore, the findings revealed significant and insignificant adoption factors. Out of six proposed factors assessed, firm size and financial readiness under organization context were significant. However, the rest four factors: perceived benefit of CAIS for better financial statement and reports preparation and perceived benefit of CAIS for better decision making under technology context, and external pressure under environmental context found to be insignificant. In conclusion, the study revealed that majority of SMEs in Addis Ababa are highly dependent on manual AIS with firm size and financial readiness identified as significant influencing factors on fully CAIS adoption. The study might generally give important insights to academicians, governmental and professional bodies regarding the adoption of CAIS as well as the factors that influence the degree of CAIS adoption among SMEs in Addis Ababa, Ethiopia.