1

BOOKKEEPING: BENEFITS, CHALLENGES, AND EFFECT ON

GROWTH AND PERFORMANCE TO
SMES IN SOLANO, NUEVA VIZCAYA

Daenielle Audrey M. Espinoza , Conie P. Hombrebueno and Lorren Graze I. Ramiro

Abstract: This study’s topmost priority is to fill the research gap in the literature by
making a significant contribution toward advancing our understanding of the
bookkeeping practices of SMEs that help them last in the business industry in Solano.
This study sought to establish the kinds of bookkeeping practices SMEs kept, the extent
to which bookkeeping information supports the growth and performance of SMEs, the
general attitude of SME owners towards bookkeeping, the challenges faced by the SME
entrepreneurs bookkeeping practices, and the relationship between respondent’s
perceived benefits, challenges, and attitudes toward bookkeeping. The study sampled 30
SMEs in Solano’s municipality who have been operating for at least five years. Data
were collected through questionnaires and analyzed using descriptive statistics and
Pearson correlation. The results showed that most SMEs prepare an income statement
that shows how much revenue a company earned over a specific period, which also
immediately dictates if business owners were generating profit or not. The findings also
show that the majority affirm that bookkeeping practices benefited their business
operations by being essential for decision-making and adjustments necessary for
preparing financial statements. The findings also show that SME owners had a positive
attitude toward bookkeeping practices. As for the challenges, the absence of guidelines
for bookkeeping that are equal to the size of the business challenges most business
owners in bookkeeping business transactions. Finally, the results showed a high positive
and statistically significant relationship between bookkeeping benefits and challenges and
a negligible and insignificant relationship between attitudes and bookkeeping challenges
and attitudes and benefits.

Key Words: bookkeeping, SMEs, benefits, challenges, attitude, growth, performance

1. INTRODUCTION represent over 99% of registered organizations in the

country and provide 60% of occupations (Aldaba, 2012).
Solano is the leading commercial and financial
Small and Medium Enterprises (SMEs) are center in the province of Nueva Vizcaya and one of the
considered the lifeblood of the Philippine economy, fastest-growing municipalities in the Cagayan Valley
contributing to employment, productivity, and output. In Region. But due to the COVID-19 crisis, small and
the Philippines, SMEs are defined as any enterprise with medium enterprises in Solano have made it more
10 to 199 employees and assets valued from P3 million challenging to take part in local and national worth
to P100 million. SMEs and micro-enterprises combined chains.
make up 99.6% of establishments in the country. They The COVID-19 crisis has significantly affected
 2

small companies in the Philippines. The economy is selected Small and Medium-sized Enterprises in Solano,
expected to shrink by 2% in 2020 after expanding by Nueva Vizcaya.
5.9% in 2019. With unemployment projected at 6.8% in Based on the total population of 59 SMEs
2020, the Philippine government has prepared an
registered with the Department of Trade and Industry
emergency response plan focusing on higher health
spending, monetary stimulus, and cash transfers and (DTI) in Solano, Nueva Vizcaya for the Fiscal Year
support to affected firms. Expanding little organizations’ (2021-2022), 30 respondents, constituting 50.85% of the
seriousness can produce versatility to the pandemic and total population, are considered as samples.
future stuns while advancing comprehensive and A study by Tallungan (2017) supports that this
manageable development (International Trade Centre, number of respondents passes the stipulations of the
2020). Although SMEs play a significant role in the
development of the economy, most researchers point out Central Limit Theorem which assumes normal
that they have not been performing well. Recent studies distribution with at least 30 samples.  
indicate the most probable cause is lack of or limited Further, the quota sampling method has been
bookkeeping. According to Musah (2017), the study employed. Such sampling method enables the researchers
investigates bookkeeping and accounting practices in to choose enterprises that have at least five years of
SMEs and the extent to which they support the operation operation in the municipality since these enterprises are
and growth of the enterprises. The study results showed
that some SME owners or managers do keep subsidiary the most experienced in the industry; therefore, they
books of accounts. They showed that by accurately could be information-rich in terms of the value of
keeping the records, they could make essential decisions bookkeeping practices implementation.
and make business adjustments accurately. However, In this study, the researchers collected data
SME owners/managers may have had a positive attitude through the administration of structured questionnaires
toward bookkeeping and accounting recordkeeping, but
among SME owners/managers. In collecting the data, the
they still lacked adequate bookkeeping knowledge.
In addition, Gebremedihin (2019) studied that researchers have employed a quota sampling technique,
the challenges that affect the application of accounting wherein the respondents are chosen based on criteria
practices for micro and small businesses are generally imposed and respondents’ willingness, availability &
difficult. The result of the study concluded that accessibility. The targeted response rate is 50.85% out of
respondents understand the contribution of accounting the total population to establish accuracy.
practice to the growth of enterprises. However, they were
In analyzing the data, the researchers used a
not correctly implemented because of a lack of skills to
handle assets and liability to prepare financial statements, statistical tool such as SPSS to aid the analysis and
the distrustful attitude of the owner, the cost of hiring a interpretation of data. 
qualified employee, and the fear of taxation to disclose The data have been organized using
all information. frequencies and percentages. A Likert scale has also been
SMEs need to keep appropriate financial data used to interpret the respondents’ input. Meanwhile,
records concerning all receipts and installments, deals
descriptive statistics such as frequency distribution,
and acquisitions of merchandise and ventures, and all
resources and liabilities from which fiscal reports are percentage, standard deviation, and mean were
readied. The financial transaction recorded should be employed. Likewise, the Pearson correlation was
objective, sufficient, relevant, and reliable to settle on considered in drawing inferential statistics.
educated choices and decisions by vested parties
(Chelimo & Sopia 2014). However, according to
Madurapperuma, Thilakerathne, & Manawadu
(2016), many SMEs fail to maintain adequate Table 1. The Likert Scale Conversion
bookkeeping records to generate the necessary
accounting information that owners, managers, and other Descriptive Rating
users need to make decisions, causing severe problems. Value Description
Interpretation Scale

2. METHODOLOGY
4.21-
Very Positive 5 Strongly Agree
To achieve the proposed research objective of 5.00
highlighting the benefits, challenges, and effects of
bookkeeping on the growth and performance of SMEs, a 3.41-
Positive 4 Agree
descriptive-correlational research design is used. In this 4.20
research design, the profile of the respondent and
enterprise are identified, while the business practices, Neither Positive Neither Agree 2.61-
3
preferences, and opinions are evaluated to generate the nor Negative nor Disagree 3.40
desirability of bookkeeping practices in maximizing the
value of the enterprise. This study is conducted on Negative 2 Disagree 1.81-
 3

2.60 20- 15 50.0 50.0 50.0

30
Strongly 1.00-
Very Negative 1 31- 3 10.0 10.0 60.0
Disagree 1.80
40

41- 9 30.0 30.0 90.0

50
Table 2. Rule of Thumb for Interpreting the Size of a
Correlation Coefficient
51- 2 6.7 6.7 96.7
60
Size of Correlation Interpretation

61- 1 3.3 3.3 100.0

0.90 to 1.00 (-0.90 to Very high positive (negative)
70
-1.00) correlation

Tot 30 100.0 100.0

0.70 to 0.90 (-0.70 to High positive (negative)
al
-0.90) correlation

0.50 to 0.70 (-0.50 to Moderate positive (negative)

-0.70) correlation
The respondents’ ages ranged from 20 to 70
0.30 to 0.50 (-0.30 to Low positive (negative) years old, with the majority being 20 to 30 as 15
-0.50) correlation respondents or 50% were at this age. The following were
41-50, 31-40, and 51-60 years old as 30%, 10%, and
6.7% of respondents were at this age, respectively. This
.00 to 0.30 (.00 to - result implies that young people dominate the SME
Negligible correlation
0.30) sector as most young workers are eager to learn, build
their experience, and apply their skills in the workforce.
Although most successful entrepreneurs can be young
adults or older, there is always the chance for young
3. RESULTS AND DISCUSSION entrepreneurs to turn their ideas into successful
businesses.

3.1 Profile of Respondents This supports the study entitled “Challenges

and Success Drivers of Young Entrepreneurs in General
Santos City” (2022), which states that the entrepreneurial
experience acquired from the academic preparation of
The significance of age, sex, and level of education young entrepreneurs today immensely helped them in
among respondents to this study are for researchers to their actual business practice. The lack of knowledge/
experience about starting a business did not surface
gain a lot of valuable detail during the analysis of the
during the existing business practice. They also believe,
respondents’ feedback to reveal if there is a strong in general, that success is not significantly dependent on
correlation between age, sex, and level of education and any fortune, talent, experience, or academic excellence
subsequent opinions and behavioral traits towards SME but rather a product of hard work and commitment.
bookkeeping practices. It will also allow the researchers
to obtain data, investigate behavioral patterns, and make
informed judgments for the aim of the research.
Table 4. Sex
Table 3. Age
Valid
Valid Cumulati Frequenc Percen Percen Cumulativ
Frequen Perce Perce ve y t t e Percent
cy nt nt Percent
Male 19 63.3 63.3 63.3

Femal 11 36.7 36.7 100.0

 4

e nt Percent

Total 30 100.0 100.0 Sole 27 90.0 90.0 90.0

Proprietors
hip

Partnership 3 10.0 10.0 100.0

The result from the table shows that out of 30
respondents, 19 or 63.3% are male, and 11 or 36.7% are
female. As both males and females have equal Total 30 100.0 100.0
opportunities at work, supporting the closing of the
gender gap in business, the results indicate that the
number of males in the SME sector is far more than
females. This contradicts the report of the Department of
Trade and Industry (DTI) from 2019, wherein they As to the form of business, the table clearly
recorded a total of 630,688 MSME business name shows single proprietorships' dominance, controlling
registration (new and renewal), and 55.8% (352,181) most of the enterprises among SMEs. Sole
were women-owned/run.  proprietorships constitute 27, corresponding to 90% of
the respondents and 10% of the partnership. This implies
that a sole proprietorship is one of the most widely used
business forms mainly due to its simplicity, minimal cost,
Table 5. Level of Education and easy, streamlined setup process, making it a top
option for sole business owners.  
Valid Cumulat
Freque Perce Perce ive According to the World Bank, in June of 2022,
ncy nt nt Percent the percentage of firms with the legal status of sole
proprietorship in the Philippines was reported at 40.2 %
in 2015, while the partnership was reported at 4.3 % in
Coll 30 100.0 100.0 100.0 2015. SMEs are often single proprietorships; sometimes,
ege the owner may also be the sole employee. It may also
apply to producing one product or providing only one
kind of service because MSMEs are single, small, and
local (Ronquillo, 2021).
The result from the table shows that 100% of
the respondents were all college graduates. It implies that
most of the respondents possess the level of literacy
required to comprehend the issues raised on the Table 7. The Sector of Business Activity
questionnaires and, as such, would be able to provide
reliable information about the SMEs’ bookkeeping Valid Cumulati
practices. It also shows that the respondents know the Frequen Perce Perce ve
essence of bookkeeping in business and could make cy nt nt Percent
meaningful contributions to the study.

Manufactur 2 6.7 6.7 6.7

It supports the study of Khairunnisa &
ing
Rustiana (2019), which states that the education level
significantly influences the Application of MSMEs
Accounting Information Systems. This means that the Wholesale/ 28 93.3 93.3 100.0
higher the education level of MSMEs owners, the higher
the SMEs' application of accounting information Retail
systems.
Total 30 100.0 100.0
 

Table 6. Form of Business Ownership

Frequen Perce Valid Cumulati

cy nt Perce ve
 5

Regarding the sector of business activity, most Records of receipts & disbursements 25 83.3
respondents are engaged in Wholesale/Retail, with 93.3%
of the surveyed firms and 6.7% in manufacturing. This
Copies of business bank statements 25 83.3
implies that wholesale/retail is one of SMEs’ most
common business activities. This is because of the low
startup costs and a significant source of growth and jobs. Record of all business purchases & 11 36.7
expenses
This was supported by the study of Amoako
(2013), which states that most businesses were involved Record of client’s names & measurement 10 33.3
in trading. It was also noted in the “2020 MSME details
STATISTICS” by the Department of Trade and Industry
that the top industry among all the sectors of business
activities are wholesale and retail trade.  Record of business sales 20 66.7

Table 8. Years of Existence As shown in the table, bookkeeping practices

are kept by SMEs. A ranking for the purposes was
Valid Cumulati developed based on the frequency obtained for each
Frequen Perce Perce ve category. In frequency, the data show that ‘records of
cy nt nt Percent receipts and disbursements and the ‘copies of business
bank statements’ ranked highest with 83.3% and
‘invoices for all business purchases & expenses’ ranked
5- 20 66.7 66.7 66.7 second with 70%. The ‘record of business sales’ ranked
10 third with 66.7%, the ‘record of all business purchases
and expenses’ ranked fourth (36.7%), and the record of
11- 8 26.7 26.7 93.3 clients’ names measurement details’ and the ‘record of
20 business sales ranked fifth with 33.3%.

21- 2 6.7 6.7 100.0 This implies that SMEs retained various
30 bookkeeping records regarding their business
transactions, including invoices for all business
purchases and expenses, sales records, information on
Tot 30 100.0 100.0 amounts paid or taken out, and receipts and
al disbursements. This support Adegbite and  Onaolapo’s
(2014) findings that SMEs keep bookkeeping records,
particularly to manage income and costs, purchases,
sales, and sales, enhancing profit margins. Bookkeeping
is applied mainly in SMEs to test the accuracy and
In terms of years in business, the results show completeness of every transaction.
that most of the SMEs sampled for the study have been
operating for 5-10 years. This implies that sampled
companies had survived enough to have the requisite
experience dealing with bookkeeping and accounting
practices concerning their business transactions. This Table 10. Financial Statements Prepared by The
supports the study of Musah (2017) that most SMEs were Business Enterprise
established in the 21st century. 
Financial Statements N = 30 F = 100

Statement of Cash Flow 13 43.3

Table 9. Bookkeeping Practices Kept by SMEs
Statement of Income 29 96.7
Bookkeeping Practices N =F =
30 100 Statement of Financial Position 11 36.7

Invoices for all business purchases & 21 70.0

expenses

The table shows that SMEs continue to prepare

Details of the amount paid into or taken 10 33.3 financial statements. As a result, the researchers
 6

discovered that some SMEs generate a complete set of has helped them in resource allocation and performance
financial statements, with the income statement being the planning, as asserted by 19 respondents constituting 63.3
highest prepared at 96.7 %. An income statement is %. Thus, these imply that some bookkeeping practices
prepared first by most business owners because it is a enabled the business enterprise to carry on with its
report that shows how much revenue a company earned operation and resulted in its growth. Consequently,
over a specific period, which also immediately dictates if bookkeeping techniques are crucial to business
business owners were generating profit or not. operations because they serve as the foundation for
proper planning and administration (Abdul-Rahamon &
This supports McMahon's conclusion that most Adejare, 2014; Amoako et al., 2014).
SMEs do not generate a complete set of financial
statements. Even with well-maintained books of According to Abdul-Rahamom and Adejare
accounts, an entity may fail to create financial statements (2014), the overall objectives of bookkeeping are to
since financial statements require accounting knowledge improve efficiency and production, manage
and abilities. Although the necessity for a complete set of responsiveness and growth to decrease operational
financial statements develops as a business grows, expenses, and meet regulatory requirements. According
reporting will no longer be limited to internal users but to Mutua (2015), efficient bookkeeping aids SMEs in
will increasingly include external users such as lenders. controlling their activities and managing expenditures
SMEs’ owners/managers must learn the expertise ahead and costs. According to the report, most SME owners
of time (Everaert et al., 2006, as cited in Muchira, 2012).  struggle with determining which accounting records are
required to support their business operations because
setting up and maintaining a complete accounting
information system for a start-up organization is costly. 
Table 11. Bookkeeping Practices That Benefited Your
Businesses’ Operation and The Growth of Your
Enterprises
Table 12. Attitudes Towards Bookkeeping
Bookkeeping Practices N = F =
30 100 Table 12 shows the owners’/managers’ attitudes
toward bookkeeping. The first provision has a mean
score of 4.40, which interprets Very Positive. Followed
Essential for decision-making and 17 56.7
by the second, third, fourth, and fifth statements, with
adjustments
mean scores of 4. 13, 3.83, 4.53, and 3.07, and fall on
Positive, Positive, Very Positive, and Neither Positive
Reduces operating costs and improves 11 36.7 nor Negative, respectively. Meanwhile, the sixth,
efficiency seventh, and eighth statements reveal mean scores of
2.90, 3.40, and 3.33 and assume Neither Positive not
Essential for preparation of financial 25 83.3 Negative interpretation.
statements
Overall, the attitude of the SME operators shows a
Assist in resource allocation and 19 63.3 general mean score of 3.70 and can be interpreted as
performance planning Positive.  Therefore, it can be deduced that SME
operators are willing to be trained in bookkeeping
because most owners are young and flexible. 
Increase the chances of business 11 36.7
operating and achieving success
The results align with Muchira’s (2012) findings
that respondents had a positive attitude toward
Meeting government regulations 10 33.3 bookkeeping. Likewise, the results empirically relate to
Madurapperuma et al. (2016). They revealed that the
owners and managers of SMEs were highly willing to
learn more about keeping accurate records of their
business transactions. 
Table 11 shows the bookkeeping practices that
benefited the owners’ business operation and the growth
of their enterprise. It reveals that out of 30 respondents, This research, however, does not support Sanga et
the majority affirms that bookkeeping practices helped al. (2014), who concluded that most SME owners have a
their business operations by being essential for decision- negative attitude toward record keeping. SMEs owners
making and adjustments, as 17 respondents or 56.7 % perceive that keeping records using accounting standards
have attested to it. Meanwhile, bookkeeping has also adds unnecessary cost, is time-consuming, and adds
been critical to preparing financial statements, as 25 nothing to their business's poor performance. However,
respondents or 83.3% have claimed. Lastly, bookkeeping they indicated that this perception has primarily
contributed to inadequate education and training among
 7

SME owners and their employees. Similarly, this study consumin

finding does not conform to the study of Nkonoki (2010), g
who found that many entrepreneurs consider record-
keeping as one of the least important parts of operating a
Bookkeep N 5 6 5 9 5 2. NP
business.
ing and 90 N
accountin % 16 20 16 30 16
1 2 3 4 5 M DI g .7 .7 .7
recordkee
Bookkeep N 4 10 16 4. VP ping adds
ing and 40 unnecessa
accountin ry costs
% 13 33 53 to my
g .3 .3 .3
recordkee business.
ping is
key to the It is a N 16 10 4 3. NP
success waste of 40 N
of a money to % 53 33 13
business. employ .3 .3 .3
an
SMEs N 1 23 6 4. P accountan
require 13 t to help
bookkeep with
% 3. 76 20 recordkee
ing and 3 .7
accountin ping.
g
recordkee The N 5 9 7 9 3. NP
ping. business 33 N
has been % 16 30 23 30
It is N 1 4 19 6 3. P very .7 .3
always 83 successfu
good to l, even if
keep a % 3. 13 63 20 I do not
record of 3 .3 .3 practice
all recordkee
transactio ping.
ns in my
business, General Mean Score 3. P
including 70
those that
did not go
well for
the M = Mean
company.
DI = Descriptive Interpretation
Willingne N 14 16 4. VP
ss to be 53 1 – 1.08 = Not Very Positive (NVP)
further % 46 53
trained in .7 .3 1.81 – 2.60 = Not Quite Positive (NQP)
recordkee
ping.
2.61 – 3.40 = Neither Positive nor Negative (NPN)
Bookkeep N 5 6 10 4 5 3. NP
ing and 07 N 3.41 – 4.20 = Positive (P)
accountin % 16 20 33 13 16
g .7 .3 .3 .7 4.21 – 5.00 = Very Positive (VP)
recordkee
ping is
tedious
activity &
time
 8

Table 13. Challenges Faced in Bookkeeping of practices could negatively affect SMEs’ financial
Business Transactions performance, contributing to their inevitable failure. The
study thus recommends developing training policy
Bookkeeping Of Business Transactions N = F = guidelines to sensitize SMEs about the need to comply
30 100 with applicable accounting practices, including internal
controls and legal requirements.

Lack of bookkeeping knowledge 12 40.0

Cost and time constraints 10 33.3

Table 14. Significant Relationship Between the
Respondents’ Perceived Benefits, Challenges, And
Inadequate education and training skills 16 53.3 Attitudes Toward Bookkeeping

Fear of discouragement in case of loss 1 3.3 Beneficia

l Bookkee
Absence of guidelines for bookkeeping 20 66.7 bookkee Mean ping
that are equal to the size of business ping Attitu Challeng
Practices de es

Fear of taxation to disclose all 10 33.3

information Beneficia Pearson 1 -.226 .830**
l Correlati
bookkeep on
ing
Practices
Sig. (2- .230 .000
The table shows that out of 30 respondents, 20 tailed)
or 66.7 % confirm that the absence of guidelines for
bookkeeping that equally to the size of business
challenges most business enterprise owners in N 30 30 30
bookkeeping business transactions. It is followed by
inadequate education, training skills, and lack of Mean Pearson -.226 1 .050
bookkeeping knowledge, with 53.3% and 40%, Attitude Correlati
respectively. Factors such as cost, time constraints, and on
fear of taxation disclosing all information have 33.3%.
Lastly, only one respondent confirms that the fear of
discouragement in case of loss is a challenge in a Sig. (2- .230 .793
business transaction. tailed)

This result implies a need to provide N 30 30 30

accounting guidelines or manuals equal to the size of the
business. These guidelines are vital components to Bookkee Pearson .830** .050 1
effectively managing the accounting and finance ping Correlati
function. It references internal management, reinforcing Challeng on
requirements, and best practices. Along with the es
guidelines, business owners must also be educated and
trained in bookkeeping, which was also a challenge. To Sig. (2- .000 .793
familiarize the guidelines, owners/managers must first tailed)
teach the basics. 
N 30 30 30
According to Santos (2019), most MSME
owners are highly aware of the proper bookkeeping **. Correlation is significant at the 0.01 level (2-tailed).
requirements, but due to some constraints, they still fail
to comply with statutory requirements. The lack of
accounting knowledge and inadequate education and
training skills precluded them from utilizing their The table shows a high positive and
financial reports in evaluating financial performance to statistically significant relationship between bookkeeping
enhance their economic decision-making.  benefits and challenges at a .83% significance level. The
results show that SME owners’ bookkeeping benefits and
challenges will increase the profitability of their business
In addition, Manda & Sibanda (2016) also
when they begin to practice proper bookkeeping
concluded that non-adherence to good accounting
practices and surpass challenges. 
 9

This result implies that the more benefits the cost, and easy, streamlined setup process, making it a top
owners have, the fewer challenges they will encounter. option for sole business owners.  These sole
And the more challenges the owners will encounter, the proprietorships were primarily engaged in
fewer benefits the owners will have. This is due to how Wholesale/Retail because of the low startup costs and a
bookkeeping is practiced in a business. Owners who significant source of growth and jobs. These sampled
know and have been trained in bookkeeping will likely companies had survived enough to have the requisite
have more benefits than challenges. At the same time, experience dealing with bookkeeping and accounting
owners who lack bookkeeping knowledge will encounter practices concerning their business transactions.
more challenges in their record keeping.
Most SMEs prepare an income statement that
The result is consistent with previous studies in shows how much revenue a company earned over a
other countries on bookkeeping practices and SMEs’ specific period, which also immediately dictates if
performance in terms of profitability. For instance, the business owners were generating profit or not.
result is consistent with the findings of Abdul-Rahamon Bookkeeping practices acquired by the SMEs helped
and Adejare (2014), wherein their study suggests that the their business operations by being essential for decision-
owners and managers of small-scale enterprises should making and adjustments. Thus, these enabled the
embrace proper accounting recordkeeping practices for business enterprise to carry on with its operation and
effective financial performance in their business.  resulted in its growth. The absence of guidelines for
bookkeeping that are equal to the size of the business
On the other hand, the results in the table challenges most business enterprise owners in
between attitudes and bookkeeping challenges (.05%) bookkeeping business transactions. Thus, there is a need
and perspectives and bookkeeping benefits (.226%) to provide accounting guidelines or manuals similar to
showed a negligible and insignificant relationship. This the size of the business. These guidelines are vital
result implies that SME owners’ attitudes have nothing to components to effectively managing the accounting and
do with or are irrelevant to their bookkeeping benefits finance function. It references internal management,
and challenges. This is due to the perspectives of owners reinforcing requirements, and best practices.
being subjective. A subjective point of view is
considered biased because it is either not the complete Along with the guidelines, business owners
picture or merely a viewpoint or expression of feelings of must also be educated and trained in bookkeeping, which
the owners/managers.  was also a challenge. These challenges, when survived,
show a high positive and statistically significant
Butte-Glenn Community College (2019) says relationship on bookkeeping benefits. Owners who know
subjective claims often express opinions, preferences, and have been trained in bookkeeping will likely have
values, feelings, and judgments. Even though they may more benefits than challenges. At the same time, owners
involve facts, they do not make factual or provable who lack bookkeeping knowledge will encounter more
claims, and therefore they are, in a sense, neither true nor challenges in their record keeping. In conclusion, poor
false in the same way an objective claim is true or false. bookkeeping practices can lead to poor financial
Subjective claims are outside the realm of what is performance, while proper bookkeeping practices will
verifiable. improve SMEs' performance. Therefore, SME owners
and managers must use good bookkeeping practices for
successful growth and financial performance.

4. CONCLUSIONS 5. REFERENCES

Enterprises of all sizes need reliable Abdul-Rahamon, O. A., & Adejare, A. T. (2014,
information to manage their businesses effectively and November). The analysis of the impact of
cost-effectively. SMEs are willing to be trained in accounting records keeping on the performance of
bookkeeping because most owners are young and small-scale enterprises. International Journal of
flexible. Based on the results, young people, primarily Academic Research in Business & Social Sciences,
males with college backgrounds, are eager to learn, build 4(1), 1-17.
their experience, and apply their skills in the workforce.
The entrepreneurial experience acquired from the
academic preparation of young entrepreneurs today
immensely helped them in their actual business practice.
Adegbite, T. A & Onaolapo, A. A. (2014). The analysis
A sole proprietorship is one of the most widely of the impact of accounting records keeping on the
used business forms mainly due to its simplicity, minimal performance of small-scale enterprises.
 10

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