Accounting Record Keeping Practices in Small and Medium Sized Enterprise’s (SME’s) in Sri Lanka
Journal of Finance and Accounting
Volume 4, Issue 4, July 2016, Pages: 188-193
Received: Apr. 12, 2016; Accepted: May 6, 2016; Published: Jun. 14, 2016
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Authors
M. W. Madurapperuma, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Kelaniya, Sri Lanka
P. M. C. Thilakerathne, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Kelaniya, Sri Lanka
I. N. Manawadu, Department of Interdisciplinary Studies, University of Moratuwa, Moratuwa, Sri Lanka
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Abstract
Small and Medium Enterprises (SMEs) play vital role in many countries including Sri Lanka, because of its role for the country's economic growth. This study discovers the level of awareness towards the importance of Accounting Record Keeping Practices and its information usage in the business. The research design is based on a survey methodology using a sample of systematically selected SMEs in Gampaha District in Sri Lanka. The target population comprised of 100 SMEs operating retail shops, manufacturing firms and supplier’s of various services in Gampaha district in Sri Lanka. It was concluded that the most of the SMEs do not keep complete accounting records because lack of accounting knowledge and the cost of hiring professional accountants. As a result, there is an inefficient use of accounting information to support financial performance measurement by SMEs. This made it difficult for the entrepreneurs to calculate their business profit efficiently. Lack of keeping of accurate records was highly blamed on the lack of skills in this field by the owners or managers. The study further revealed that the owners and managers of SMEs were highly willing to learn more about how to keep accurate records of their business transactions. The results of the study also revealed that majority of the SMEs encounter problems of lack of accounting knowledge. This study recommended that that the responsible authorities should come up with an effective programme for training for SMEs entrepreneurs.
Keywords
Accounting Practices, Accounting Information, Record Keeping, Small and Medium Enterprises (SME), Sri Lanka
To cite this article
M. W. Madurapperuma, P. M. C. Thilakerathne, I. N. Manawadu, Accounting Record Keeping Practices in Small and Medium Sized Enterprise’s (SME’s) in Sri Lanka, Journal of Finance and Accounting. Vol. 4, No. 4, 2016, pp. 188-193. doi: 10.11648/j.jfa.20160404.14
Copyright
Copyright © 2016 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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