The effect of accounting informtiom systems on sme operational profitability in kitoro, entebbe municipality
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Date
2026-04-13
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Uganda Christian University
Abstract
This study examines the effect of Accounting Information Systems on the operational profitability of small and medium sized enterprises within kitoro, Entebbe municipality. The research is guided by four objectives: to identify the effect of AIS on operational profitability of SMEs, to establish the relationship between AIS and operational profitability, to identify the challenges SMEs face in implementing and utilizing AIS and to identify strategies to enhance AIS effectiveness. The study adopted a mixed methods research design. Data was collected from a sample of 40 SMEs in kitoro using questionnaires and interviews. Quantitative details were evaluated using descriptive statistics while qualitative details were examined ideologically to provide contextual depth to the findings. The results reveal a notable positive effect of AISs on SME operational profitability with major benefaction including bettered accuracy of financial records, quicker transaction processing and improved cost control. The study confirms a powerful positive relationship between the effective use of AISs and elevated operational profitability, signifying that SMEs with strong AISs are in
a better position to recognize profitable opportunities and run operational expenses. However, the execution and utilization of AISs are obstructed by multiple challenges including high enactment costs, deficiency of technical expertise, and opposition to change from workforce and information security concerns. To conquer these obstacles, the study pinpoints crucial strategies such as financing staff training, choosing a system and user friendly software, application of strong
internal controls and nurturing a culture that embraces technological adaptation. The study wraps up that AISs are not simply tools for conformity but are strategic assets that directly leverage the operational profitability of SMEs. To enhance this effect, SMEs can forethoughtfully handle enactment challenges through strategic preparation, capacity development and constant system evaluation. The findings present beneficial insights for SME owners, managers and policymakers pursuing to leverage technology for eco friendly business growth and improved financial performance.
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undergraduate