Scenario of E-Accounting Practice in Ready-made Garments (RMG) Industry of Bangladesh

Abstract

E--accounting is referred as the internet based accounting software usage in performing accounting functions. Responding to the evidence that Bangladesh’s top business sector, Ready-made Garments (RMG) factories largely using e-accounting, the study is aimed to explore the scenario of the practice in those factories. To achieve these objectives, the study deploys mixed research strategy constructed with interview and survey. Based on the prevailed e-accounting literature, and interview with user RMG factories authority and vendors, structured questionnaire was formed for the survey. This firm level study considers 3552 listed RMG factories as the population. Using G-power 3.1 sample size calculating software, considering smaller effect size f2=0.04, the study has taken 300 sampled factories both of woven, knit, composite and sweater. The study conducted interview using semi-structured interview schedule at convenient way. Also using convenience sampling technique, a survey on sampled factories was executed with the use of structured questionnaire. Survey respondents were the policy level personnel of RMG factory such as owners, managing directors, executive director, factory manager, and or chief accountants. IBM SPSS 20.0 has been used to analyze survey data. Using descriptive statistics, the collected data was presented and analyzed. The study reveals that about 86% RMG factories are using internet based accounting solution for performing accounting, inventory and payroll functions. The study also results that ERP usage is more than that of stand-alone accounting software modules and private cloud usage is more popular in RMG sector than that of public, hybrid or community cloud. This study also finds that knit sector remains ahead in using e-accounting and sweater factories is slightly back in e-accounting implementation. The study bears the significance to the RMG factories and other cloud applications users. Keywords: E-Accounting, Online accounting solution usage, Ready-made Garments Industry, Bangladesh