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1 The Findings The results showed positive means ranging
from 3.50 to 3.99, reflecting the overall
In a survey conducted by Abayomi & Adegoke (2016), 76 out of 94 respondents agreement among respondents. The top
believed that manual record keeping was more useful and popular among SMEs. statement, "Records keeping help in
Only 18 thought otherwise, it seems old habits die hard! In a survey by Maseko detecting thefts within the business itself,"
and Manyani in Zimbabwe (2011), they found that SMEs often failed to keep had the highest mean of 3.99. This was
complete records. This shortfall is usually due to the lack of accounting followed closely by another key insight:
knowledge and the financial burden of hiring professional accountants. The "Records keeping provide information to
trend of incomplete record-keeping continues in Ghana, where low levels of enable the control of cash in the business,"
education and inadequate accounting knowledge left a significant 59% of SMEs with a mean of 3.85. However, the
out of formal accounting's loop, according to a study by Mbroh and Atom (2011). statement "Complete accounting records
are essential for preparation of financial
According to a 2013 study by Abdul Rahamon, opinions on record keeping's statements" had the lowest mean at 3.50.
importance varied among respondents. While only a fraction (19%) strongly
agreed that record keeping is crucial for decision making, another 41% also
agreed. However, we can't ignore that 11% were unsure, 21% disagreed, and 8%
strongly disagreed. Over in Ho municipality, Ghana, a study by Agbemva et al.
(2016) revealed that 54.9% of SMEs used single-entry bookkeeping and 45.1%
opted for double-entry systems. Importantly, many participants expressed that
preparing financial statements had a significant impact on their business Next, respondents were asked to identify
growth. Abdul Rahamon and Adejare (2014) also found a strong positive link the person responsible for keeping the
between accounting record keeping and SME growth. This connection business records. First place goes to the
underscores the importance of understanding accounting principles for SME owners themselves! An impressive
businesses of all sizes. majority of 49.2%1 were their own firm's
record keepers. Following this, the Sales
Officers stepped up to the plate, with 26.4%
of them taking the responsibility of record
keeping1. Next in line were the Account
Officers, at 11.7%1, and trailing at the end
were Consultants, with just 6.6%1 handling
the records.
The Impact of Record Keeping on the Performance of
JULY | 2023 Selected Small and Medium Enterprises in Lagos Metropolis
Survey respondents were asked to reveal
their chosen method of record keeping. The
majority of our SME owners, representing
72.1%, quite literally kept it "old school,"
maintaining their records manually. Then,
we have our tech-savvy SME owners opting
for Microsoft Excel, making up 11.7% of the
responses. Finally, the ones taking
technology to an even higher level with
specific software for record keeping were
only 3%.
It's pretty clear that when it comes to
record-keeping, SME owners have diverse
preference.
Respondents were asked to rank their level
of agreement on statements about the
perks of maintaining accurate records. The
results showed positive means that ranged
from 3.40 to 3.93, with standard deviations
between 0.77 and 1.36. "To know the
performance of the business" indeed shined
bright with the highest mean of 3.93. Next,
with a mean of 3.79, was "To determine the
financial position of the business". But don't
forget the one that trailed behind just a bit
- "To have access to credit" earned the
lowest mean at 3.40.
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