Influence of Accounting Practices in Small and Medium Enterprises

Influence Of Accounting Practices In Small And Medium Enterprises 1
INFLUENCE OF ACCOUNTING PRACTICES IN SMALL AND MEDIUM ENTERPRISES
Name:
Institution:
Course:
Tutor:
Date:

Influence Of Accounting Practices In Small And Medium Enterprises 2
Abstract
Small alongside medium enterprises act as the backbone of every business and commerce
by creating several entrepreneurs, involving different stakeholders, creating job opportunities for
a skilled and half skilled workforce. The main purpose of this survey is to determinant how
accounting practices influence operations of small alongside medium enterprises (SMEs) in
different regions around the global community. The primary research inquiry of this examination
includes: What is the role of accountant practices in SME’s? and what kind of benefits, SME’s
expect from professional accountants? The use of descriptive survey design will be embraced for
the survey. Besides, targeted population for units used in this study will include a population of
130 SMEs as respondents and a sample of 100 respondents will be used in this survey. Data
present in the Ministry that deal with trade along with industrialization will be used to include 60
SMEs in the manufacturing sector, 25 SMEs in trading sectors, together with 15 SMEs in the
service centers will be used. The use of stratified sampling technique will be applied as a way of
determining the sample size of one hundred from entire population in the research. For this
examination, vital information will be gathered by well-prepared questionnaires founded on
identified survey questions supplemented by follow up face to face interview. Besides,
descriptive statistics will be used during the analysis process..
Research problem
In most countries such as in Australia, SMEs sectors are considered as major contributors
to financial stability. These enterprises provide income along with employment to a major
portion of people in most nations. The different survey has reported that SMEs contribute to over
seventy per cent of newly created jobs in a single year (Zotorvie 2017). Despite the importance

Influence Of Accounting Practices In Small And Medium Enterprises 3
of SME in different regions, different surveys have recorded that three out of five business
operations fail within three years after their establishments (Cuzdriorean 2017). For instance,
failure in operations of SMEs results in loss of occupations and then results to increase in
instances of insecurity, depleted liquidity in market, as well as declined financial progress.
Research question
The study has the expectation of finding appropriate answers to several questions under
investigation. Some of the important research question in this examination comprises of;
i. What is the role of accountant practices in SME’s?
ii. What kind of benefits, SME’s expect from professional accountants?
Hypothesis
In reference to literature work, this examination target at offering deal answers on impact of
accounting operations on operations of SMEs. This proposal of the survey will aim ate checking
the subjected hypotheses with the aim of attaining the best conclusion on the issue under
examination.
First Hypothesis
H0: Accounting practices influence the operations of SMEs.
H1: Accounting practices do not pose any impact on operations of SMEs.
Hypothesis 2
H0: Accounting practices influence the cost reduction in operations of SMEs

Influence Of Accounting Practices In Small And Medium Enterprises 4
H1: Accounting practices do not pose any impact on the reduction in cost in operations of
SMEs
Delimitations and limitations
The application of a specified test remains as big restriction in this survey. The study only
focused on a particular number of SMEs while there are various enterprises around the
Australian community. Such ideas might be ineffective in attaining the appropriate solution on
whether accounting activities impact the operations of SMEs. Due to time constraint in
conducting the research in this diverse field that involves many enterprises make it tough for the
surveyor to attain an effective outcome (Haider, Munajat, and Kamarulzaman 2013). The study
requires huge sum of funds in order for plan to attain its completion.
Background
It is clear from most researches that SME plays a fundamental purpose in the economy
especially for countries that are still developing as well as economically emerging states.
Different accounting operations of SMEs do not necessarily provide complete as well as
pertinent financial data required to improve financial choices made by various business operators
(Asirah 2018). It has been noted with a lot of concern that the majority of SMEs around various
markets such as in Australia does not maintain comprehensive accounting reports. The lack of
appropriate documentation of accounting by such enterprise does arise because of lack of
effective knowledge of accounting. Besides, most SMEs fail to prepare financial records at all
during their operations, hence, the financial assessment is not done as a result. Therefore, all
these instances within the operations of SMEs have to lead to the primary target of this research
proposal. The chief target is thus to investigate the impacts of accounting activities within SMEs