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Present study aims to explore the system assessment mechanism of Open Distance Learning (ODL) system followed by Allama Iqbal Open University. It further purports to find out the perception of teachers and students about the system assessment in instructional design mechanism of ODL. Present study was descriptive in nature and survey design was used. Population of the study comprised students and faculty members of Allama Iqbal Open University Islamabad. By using convenient sampling technique, data was collected through questionnaire from 100 teachers and 300 students. Three point Likert scale was developed by researchers which consists of five subscales including Course Development, Course Delivery, Admission Procedure, Student Support Service and Assessment and Evaluation. Questionnaire consists of 30 statements and its Cronbach Alpha reliability was .81. Findings of the study revealed that ODL system in AIOU comprised five major dimensions while some of those need improvement. It is recommended that AIOU may develop a framework of assessment based on systematic process of identifying, analyzing and assessing the present needs and issues of students and university by shifting its trend towards online workshops and assignments on Learning Management System (LMS), etc.
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