ASSESSMENT OF THE IMPORTANCE OF USING ACCOUNTING AND FINANCIAL PROCEDURES FOR SME DEVELOPMENT RESEARCH PROPOSAL PAPER

ASSESSMENT OF THE IMPORTANCE OF USING ACCOUNTING AND FINANCIAL PROCEDURES FOR SME DEVELOPMENT

Background of the proposed study

There is no exact construct of what constitutes a small medium enterprise, mainly because of the range and diversity of businesses. Accordingly, small and medium enterprise (SME) is a firm whose headcount or turnover is below certain limits. The European Union (EU) Member States were given as examples which traditionally had their own definition of what constitutes an SME, because in Germany such concept has a 500-employee limit while Belgium considers it to be at 100 head count. Currently, however, the EU has been standardising the concept definition of SME which categorises firms with less than 50 employees as small and those with less than 250 housed employees as medium. Business enterprises of less than 10 employees meanwhile are often called SOHO, for small office/home office.

Perhaps, the emergence of the accounting and financial procedures and system has been considered as an important factor to consider by each business. Consequently, this existence has been deliberated as the unquestioned basis for the rivalries and competencies in this generation. Such accounting and financial procedures and system improvement have conveyed people specifically those in the business market to consider new strategies which would be beneficial for developing corporate value of any firms and businesses (Weill & Broadbent, 1999). The details of conveying with these needs, through enhance proficiency, integrated with the innovation practice of accounting and financial standards have raised the responsiveness of both accountant as well as management to have more strategic-oriented tactics for management and planning, specifically among SME development.

Thus, more and more businesses are attempting to develop and implement new accounting and financial procedures and system or which would guarantee their competencies in the market place without compromising the information of the entire company, specifically in the SMEs. This proposed study aims on investigating the impact of accounting and financial procedures and system in small scale businesses.

Research Objective

The following statements cover the objectives that this analysisendeavour aims to achieve upon the completion of the data and information needed through sound analysis and interpretation of the findings of the proposed study:

· To investigate the context of accounting and financial standards within SME development.

· To know the problems and issues faced by the SME development in terms of ensuring accounting and financial procedures and system.

· To analyse how accounting and financial procedures and system enables SME to achieve efficient financial performance and development

Methodology

To achieve the objective of this proposed study, the author opted to use descriptive tactic of analysiswas utilised. The purpose of employing the descriptive tactic is to describe the nature of a condition, as it takes place during the time of the proposed study and to explore the cause or causes of a particular condition. The author opted to use this kind of analysisconsidering the desire to acquire first hand data from the respondents so as to formulate rational and sound conclusions as well as recommendations for the proposed study.

This analysiswill partially base its findings through quantitative analysistactics because it permits the analysisproblem to be conducted in a very specific and set terms (Creswell, 1994). This proposed study will also employ qualitative analysistactic because it will attempt to find and build theories that will explain the relationship of one variable with another variable through qualitative determinants. This permits a flexible and iterative approach. During data gathering the choice and design of tactics are constantly modified, based on ongoing analysis. Primary and secondary data will be used in this proposed study. The secondary data will be collated from academic materials and analysispublications about accounting and financial standards in SME development.

Reference

Carter, WP, Davies, M, El-Ayouty, Y & Ford, KJ 2000, Government Ethics and Law Enforcement: Toward Global Guidelines, Praeger Publishers: Westport, CT., p. 3.

Creswell, J.W. 1994, Analysisdesign. Qualitative and quantitative approaches. Thousand Oaks, California: Sage.

Gethmann, CF 1998, “Working Across Cultures, Ethical Perspectives for Intercultural Management”, Issues in Business Ethics, vol. 9, as edited by Lange Löhr, and Steinmann, Dordrecht/ Boston/ London: Kluwer Academic Publishers, pp. 223-229.

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