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CHAPTER FOUR DATA ANALYSIS, INTERRETATION AND DISCUSSIONS 4.1

Introduction

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 CHAPTER FOUR

DATA ANALYSIS, INTERRETATION AND DISCUSSIONS

4.1 Introduction

This chapter deals with data analysis, interpretation and discussion of the key finding obtained

thought the study. The social- demographic data is presented and analyzed first after which data

pertaining to research questions is also presented and analyzed in relation to the findings obtained

from the field. Generally, the researcher examined the role of accounting information in

managerial decision making at in Arusha.

4.2 Data Presentation, analysis and interpretation

4.1.1 Demographic information

This section describes background information of the respondents in the aspects of gender, age,

level of education and location of work, such information is crucial as it helps to know if the

respondents met the morally acceptable standards to be involved in the research and provides

required information in regard to the study.

4.1.2 Gender of the respondents

In this regard. The findings indicate that 52.7% (59) of the respondents were female while 47.3%

(53) of respondents were male. This implied that both males and females were involved in this

study. Table 4.2.1 below shows the distribution of general characteristics of the respondents. The

findings shows that females` respondents were many than males.

 Table 4.2.1. Gender of respondent.

frequency percent Valid percent Cumulative percent

Valid Female 59 52.7 52.7 52.7

Male 53 47.3 47.3 47.3

total 112 100.0 100.0

Source: Filed study (2017)

4.1.3 age of respondents

As demonstrated on table 4.2.2 below, age of respondents was categorized into four main

categories: Respondents between 18-25 years were 7.1% (8), between 26-35 years comprises

22.3% (25) of respondents, between 36-45 years comprises 40.2% (45) of respondents above 46

years comprises 29.5% (33) of respondents and I respondents filed to indicate their age. This data

implies that a majority in Arusha are aged between 36-45 years of age followed by staff who were

above 46 years. The young generation at Arusha according to this data seems to below which 7.1%

(8) of respondents.

frequency percent Valid Cumulative

percent percent
Between 18-25 years 8 7.1 7.2 7.2
Between 26-35 years 25 22.3 22.5 29.7
Between 36-45 years 45 40.2 40.5 70.3
Above 46 years 33 29.5 29.7 100.0
Subtotal 111 99.1 100.0
Not indicated 1 .9
112 100.0
Source: Filed study (2017)
4.1.4 Location of work

Table 4.2.3 below demonstrates that respondents were located at two stations, namely head office
and outstation. 75.9% (85) of respondents’ working station is the head office, 23.3% (26) of
respondents were found in various outstation while one respondent did not indicate the working
station.

Table 4.2.3 Location of work

Frequency Percent Valid percent Cumulative

Valid Not indicated 1 .9 .9 .9
Head office 85 75.9 75.5 76.8
Outstation 26 23.2 23.2 100.0
Total 112 100.0
100.0
Source: Field study (2017)

4.3 Analysis of research questions

4.1.5 Research questions data presentation, Analysis and interpretation

In order to answer research questions for the study at hand descriptive statistics were carried out
and an analysis based on mean was done. This required the researcher to determine means
measuring scale as detailed in the subsequent paragraphs.

The items of the questionnaire were measured by the four point Likert scales which entailed
strongly agree to strongly disagree, an arrangement which made the analysis easier and quick. The
scale of interpretation of the mean is demonstrated in the following illustration.

1. 1.00 – 1.75 Strongly disagree

2. 1.76 – 2.50 Disagree
3. 2.51 – 3.25 Agree
4. 3.26 – 4.00 Strongly agree
 4.1.6 Research question one: what is the role of accounting information in managerial
decision making in Arusha?

As it has been clarified the study aimed to identify the role of accounting information in
managerial decision making in Arusha the findings of which are shown on table 4.3.2 bellow
this objective was deemed important as it is findings would help managers not only in Arusha
city but also in the county to work upon better ways of decision making for the good of their
companies.

Table 4.3.2: Role of accounting information in managerial decision making in Arusha

Statement Mean Interpretation

score
1. Inclusion or omission of accounting information would have 2.95 Agree
an impact on management decision making
2. Accounting information helps management to allocate scarce Strongly agree
resources to the most effective institutions. 3.33
3. Informed financial decisions enhance overall performance of Strongly agree
the institute 3.47
4. Financial statement helps management to understand the Strongly agree
performance and position of the institute 3.47
5. Accounting information is relevant to management systematic Strongly agree
and rational decision making 3.46
6. Management can make forecasting decision via accounting Strongly agree
information 3.37
Source: Field work (2017)

Table 4.3.2 shows that (2.95) mean score of respondents agreed to the fact that inclusion or
omission of accounting information would have an impact on managerial decision making
while on the same vein, (3.33) mean score of respondents strongly agreed to the fact that
accounting information helps management to allocate scarce resources to the most effective
institutions. 3.47 mean score of respondents strongly agreed with statements that informed
 financial decisions enhance overall performance of the institute and financial statements helps
management to understand the performance and position of the institute as 3.37 mean score of
respondents also strongly agreed with the fact that management can make forecasting decisions
via accounting information in Arusha implies that accounting information is very important in
decision making of any organization. the findings rhyme with Chris (2009) who noted that
relative factors and manager’s preferences strongly influence the utilization and the
interpretation of accounting information in decision making strategies and processes

4.1.7 Research question two: What is the relevant accounting information used in
managerial decision making in Arusha.
Table 4.3.3: Accounting information used in managerial decision making in
Arusha
Statement Mean Interpretation
score
1. Statement of comprehensive income enables management to 3.21 Agreed
realize if the institute is making loss or not
2. Statement of financial position gives decision maker the 3.59 Strongly
liquidity position of the institute agreed

3. By using cash flow statement report management and board 3.14 Agreed
gets real picture of what was spent and collected during the
year
4. Budget is used as a tool to direct decision makers 3.50 Strongly
agreed

5. Decision of management largely depend on accounting 3.48 Strongly

information agreed

Source; field study (2017)

Table 4.3.3 shows that respondents agreed to the fact that comprehensive income enabled
management to realize whether the institute was making losses or not with a mean score of (3.21)
this implies that in Arusha comprehensive income provides management with accounting
information which enables them to know whether the institute was performing or not. Similarly
agreed with the statement item which sought to know whether the statement of financial position
provides the decision maker with information about the liquidity position of the institute that
enables them to make liquidity decisions of the firm. The mean score in this regard was (3.59)
such findings are in line with Chong (2007) whose study revealed that accounting information
helps managers understand their tasks more clearly and reduces uncertainly before making their
decision. Therefore, accounting information is a basic tool for recording reporting and evaluating
economic events and transactions that affect private and public institutions. Likewise, in South
Africa, hope (2009) found that implementation of accounting information leads to better decision
making while Wada (2014) from Dangote plc. In Nigeria found out that companies use accounting
information in business decision making

Table 4.3.3 also makes it clear that respondents agreed with mean score of (3.14) with the
supposition that cash flows provides management with information about funds collected and
spent during the year by the institute. Respondents also agreed with the statement item that the
budget is used as a tool to guide and direct decision makers in matters pertaining to budgets and
planning for the future of the institution. The mean score for the statement was (3.50). According
to IPSAS 1, (2006) financial accounting information is derived from financial statements such as
statement of financial position statement of comprehensive income cash flow statement, statement
of changes in equity and notes to the financial statements. Therefore, financial statements describe
information about allocation of income including the uses of financial resources the ability of an
entity to finance its activates as well as the ability to meet its liabilities. Respondents also agreed
that decisions of management largely depend on accounting information (3.48) which implies that
managerial decisions are largely affected by accounting information. Decision makers do need
financial information to help them determine if their capacity to generate future profit (I.e., take a
particular action) would be impaired or not (young, 1987). On the other hand, the reports specific
to managerial accounting consider, on one hand, the past activity of the entity, in more details, but
they constitute, at the same time, a basis for elaboration of future decisions of strategic, tactical
and operational nature (Berheci, 2010).
4.1.8 Research question Three: What is the type of managerial decision that quires the
accounting information?

Table 4.3.4: Managerial decision that requires the accounting information in Arusha

statements Mean Interpretation

score

1 .Strategic decision are made by the Board trough accounting 3.37 Strongly agreed
information
2. Decisions about the perception of employees are made 3.46 Strongly agreed
through accounting information.
3. Decision as to whether the institute is making profits or not 3.54 Strongly agreed
is made via accounting information
4. Time factor in decision making is largely dependent on 3.47 Strongly agreed
accounting information
5. Decisions about overall performance of the organization via 3.35. Strongly agreed
growth, effectiveness, productivity etc. is made through
accounting information
6. Management can easily make effective decisions that would 3.38 Strongly agreed
move the enterprise forward through accounting information
Sources: Filed study (2017)

As clarified on table 4.3.3 the respondents strongly agreed with the supposition that decisions

require accounting information to be perfect. Generally, the respondents agreed with the following

decision dimensions: strategic decisions made by the Board with (3.37) mean score, decisions

about the perception of employee with (3.46) means score, decisions as to whether the institute is

making profits or not with (3.54) mean score and time factors in decision making with (3.47) mean

score. Other dimensions include decisions about overall performance of the organization via

growth, effectiveness, productivity etc. with (3.35) mean score and effective decisions that would

move the enterprise forward can easily have made by management. The responses rhyme with
Mbwelwa, (2014) `s study which concluded that the use of accounting information boost

operations and efficiency of an organization, hence decision making for the organization.

4.1.9 Research question four (4): What was the relationship between accounting information

and managerial decision making?

This research question was answered by testing the null hypothesis: there was no significant

relationship between the role of accounting information and managerial decision making at

Tropical Pesticide Research Institute in Arusha region. The composite variables role of accounting

in Arusha and managerial decision making were created then Pearson correlation test followed as

per output of table 4.3.5 below.

Table 4.3.5: Correlations between accounting information nod managerial decision.

Role of Managerial
Accounting in decision in Arusha
Arusha
Pearson Correlation 1 .377
Role of Accounting in Arusha Sig. (1-tailed)
N 111 .000
Pearson Correlation .377 111
Managerial Decision in Arusha Sig. (1-taled) .000 1
N 111
112
Source: Filed study (2017)

Table 4.3.4 shows that there was a significant relationship role of accounting information in Arusha and

managerial decision making in Arusha at R=.377, P=0.000. Because the null hypothesis: There was no

significant relationship between the role of accounting information and managerial decision making in

Arusha region was rejected at p=0. 000, Alpha=0.05

 CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 Introduction

This chapter covers the summary of the research topic conclusion based on the finding of the
research and recommendations for actions and further research.

5.1 Summary of research findings

The research used a sample size of 127 respondents who filled the questionnaires and returned
them to the researcher for analysis. Descriptive research design was used in data analysis with the
help of statistical package for social science (SPSS). Workers from different departments at
tropical pesticides research institute were given chances to give their perceptions on the role of
accounting information on managerial decision making.

The results from data analysis revealed that there was a significant relationship between accounting
information and managerial decision making in Arusha. The aspect of research methodology was
fully followed in order to obtain the result which helped to achieve the following research
objectives.

5.1.1 Role of accounting information on managerial decision making in Arusha

The study aimed to identify the role of accounting information in managerial decision making in
Arusha. The study revealed that Arusha management uses accounting information in their decision
making and forecasting. The information is also used to allocate scarce resources, enhance overall
performance and understand the performance and position of the institute.

5.1.2 Relevant accounting information used in managerial decision making in Arusha

The researcher was also intended to explore relevant accounting information needed by Arusha
management in decision making. Analysis of the finding indicated that financial statement of
financial position (balance sheet) was the most relevant accounting information which gives
management the real picture of institutes’ liquidity position and budget, helping in forecasting
issues.
5.1.3 Types of managerial decision that requires the accounting information

The third objective in this study was to determine types of managerial decision that requires the
accounting information in Arusha. As the previous chapter has clarified, the respondents strongly
agreed that decision as to whether the institute was making profits or not was made via accounting
information. The results revealed that accounting information was largely dependable on making
timely managerial decisions. This implied that Arusha management could not make strategic
managerial decisions about performance of the organization via growth, effectiveness,
productivity without using accounting information.

5.1.4 Relationship between accounting information and managerial decision making in

Arusha

Regarding this objective, the researcher intended to determine the relationship between the role of
accounting information and managerial decision making Arusha city. It was evident that there was
a significant relationship between the role of accounting information and managerial decision
making.

5.2 Conclusion

As per the data from the field, it is evident that accounting information performance a crucial role
on management decisions and organization performances. Needless to say, it has been proven to
be a major force in decision making. This is achieved by implementing the best fundamental
concepts of accounting suitable for each company. After working with respondents from Arusha,
the researcher understands that, for any company to be successful it should make use of accounting
information because for the right method to achieve the organizational goals and objectives. Also,
studies have shown that successful utilization of accounting information requires a fit between
three factors. First, a fit must be achieved with dominant view in the organization or perception of
the situation. Second the accounting system must fit when problems are normally solved, i.e. the
technology of the organization. Third, the accounting information must fit with the culture of the
organization i.e. the norms and value system that characterizes the organization. Finally, there are
evidences of a high level of awareness pertaining to the role of accounting information and
managerial efficiency. There was also a high level of awareness pertaining the role of accounting
information system which was not limited to senior and management staffs alone but also across
 intermediate and junior staffs whose operations are also governed by accounting information
system. It was also evident that accounting information factors loom large among factors which
contribute to the overall corporate efficiency.

5.3 Recommendations

The following recommendations are made:

1. The CEO and management in Arusha consult professional accountants to learn about
various laws that affect them. The professional will also help the facility to familiarize
themselves with the variety of financial records that they need to maintain.
2. Decision making should be administered in flexible and variable rigid adherences to
accounting information, which are clearly appropriated for current conditions. This will
cause the whole accounting system to gain credibility and effectiveness.
3. Arusha should always keep records of past events for future use. This can be possible with
the use of computer or by fully automating the company’s operation.
4. A professional accountant should be employed by the company in order to keep valuable
information and accurate records of the company’s accounts.
5. Employees should be encouraged to develop themselves so they can become professionals
in their respective career. This will affect the company to grow positively.
6. Effective communication and information flow is important for a good accounting system.
In this regard the organization should provide communication channels between top and
lower leaves of management regarding long and short term objectives and the practical
problems of implementing those objectives.
7. Efforts should be made to measure the effects of currently employed accounting strategies
on management decision making.
5.4 Direction for further Research
The researcher recommends that future researchers undertake research on the following
areas which were not covered in the current study:
a. The role of accounting information in strategic decision making in service sector in
Tanzania
b. The impact of accounting information on organizational financial performance in
Tanzania.

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