Accounting practices of small scale businesses

The importance of financial performance measurement to any business entity, big or small, cannot be over-emphasized.

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. Ensuring that a business continues as a going concern is also important, the fundamental concern of most small entities and their financial not surprisingly is survival.

Perhaps cash flow is one of the major records in any enterprise. Reported profits reflect changes in wealth of owners and this can explain why major economic decisions in business are centered on financial performance as measured by profitability, Cooley, To assess the need for specific regulation of accounting and financial reporting practices of SMEs.

Methodology 4. A clean set of books leads to clean audit and less hassle from the tax authorities.