Accounting Practices of SMEs: A Case Study of Kumasi Metropolis in Ghana
Added on 2021-06-16
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Applied Business ResearchWord Count- 16961 | P a g e
ContentsIntroduction.................................................................................................................................................3Summary of the theory and progression in the field...................................................................................3Literature Review........................................................................................................................................41st Literature- Accounting Practices of SMEs: A Case Study of Kumasi Metropolis in Ghana by Gilbert Kwabena Amoako....................................................................................................................................42nd Literature: Assessing the Effects of Sound Financial Statement Preparation on the Growth of Small and Medium-Scale Enterprises by Edinam Agbemava et al.....................................................................43rd Literature: The Relevance ofAccounting Records in Small Scale Business: The Nigerian Experience by Raymond A. Ezejiofor, Ezenyirimba Emmanuel, Moses C. Olise.........................................................54ht Literature: THE USE OF MANAGEMENT ACCOUNTING PRACTICES IN MALAYSIAN SMES by Kamilah Ahmad.....................................................................................................................................................5Common Themes of these articles..............................................................................................................6Different themes of these articles...............................................................................................................6Managerial implication of the four articles.................................................................................................6Study limitation with further scope of research..........................................................................................6References:..................................................................................................................................................72 | P a g e
IntroductionThis article will develop literature review for small business enterprises in Australia in respect ofits accounting records with their relevance for the operation of the business to meet theexpectation of both internal and external stakeholders. It is also to be considered how accountingrecords influence performance of this type of business. [ CITATION Pet17 \l 1033 ] In Australia, small business enterprises are defined as per three categories- legal status ofbusiness, annual business turnover and number of employees. The Australian Bureau of Statisticshas specified the legal status of business as ownership, partnership, company or trust. The annualturnover of business enterprises must be less than $ 2 million. The employee strength should beless than, equals to or slightly more than 20 heads. [ CITATION Geo15 \l 1033 ]The accounting records relevant to the small business enterprise in Australia are common as perthe global trend. Normally accounting records are consisting of income statement, consolidatedfinancial position, cash flow and the accounting policy followed by the business as per itsrequirement. As accounting records are constructed on the financial instruments, they are to bedefined also. Financial instruments are invoices, GRN, receipts and relevant journal entries.[ CITATION Ali14 \l 1033 ]Summary of the theory and progression in the fieldThe theory of accounting has its role from the start of business. It is relevant irrespective ofbusiness size. Basic theory of accounting is to derive the income from the business along withconsolidated financial position of the business. These outcomes can be revealed from differentaccounting records like income statement, balance sheet and cash flow. Accounting records aremainly generated from different financial information namely invoices, receipts GRN, etc.[ CITATION Acc17 \l 1033 ]Earlier accounting was prevalent in raw form. As the time goes, modification is found withseveral additions of records. Business is mainly connected with different stakeholders. Hence,the satisfaction of those stakeholders is the main objective of business. Accounting records arebased on historical financial information depicting financial position of any business. Theseaccounting records project to the stakeholders the financial health of the organization. Theserecords also highlight the profitability of the business for a specific financial time. [ CITATIONRab12 \l 1033 ]For small business enterprises of Australia, the internal stakeholders are employees and owners,while external stakeholders are creditors, debtors and government. The purpose of soundaccounting records is to satisfy their queries in logical way. Hence, the requirement of soundaccounting records following proper accounting policy is necessary for transparent presentationof financial transactions of the organization. [ CITATION Mic14 \l 1033 ]3 | P a g e
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