ACCOUNTING INFORMATION SYSTEM (AIS) PRACTICES AND ITS EFFECTS ON SMES: THE BANGLADESH HANDLOOM INDUSTRY EXPERIENCE

Abstract

The study is aimed to identify the scenario of practicing the Accounting Information System (AIS) by Benarashi,
Jamdani, Reshmi, Shari, Lungi and Gamcha producing Handloom industry of Bangladesh. A qualitative research
design was employed and a non-probability sampling design in the form of a convenience sampling method was
employed to gather the data. Data were drawn from both primary and secondary sources. Primary data was drawn from
30 small-scale Shari-Lungi producers, 5 each from Pabna, Sirajgonj, Tangail , Dhaka , Narayangonj, and Narshingdi of
Bangladesh by administering semi-structured questionnaires through personal interviews. There are many perceived
factors affecting their adoption of accounting information system practices and their effects on their business operations
in the area. Among such factors include; lack of adequate knowledge and training, willful misconduct, and negligence
from owners as well as controlling authority part. It is also revealed that, all levels of employees are ignorant about
the use of Accounting Software; rather they try little to keep accounting records manually. It was also found that
accounting illiteracy is the root cause of that. It was concluded that the lack of accounting knowledge and skills may
in future threaten the financial steadiness of the Handloom Sector. In sustaining the sector, the findings recommends
operators to undergo basic accounting training as well as Accounting Software training to acquire relevant knowledge
and skills, employ qualified accounting information systems personnel and providing them with good motivational
packages to ensure that their efficiency and morale is enhanced and, maintain strong internal control to check the
practice of misappropriating funds in the business.