The Bookkeeping Practices of Micro, Small and Medium Enterprises (MSMEs) in the Quezon Province: A Program for Business Sustainability

Abstract

This study presents the bookkeeping practices of selected micro, small and medium enterprises in a Philippine city in specific areas such as awareness and practice in terms of proper bookkeeping requirements as stipulated in the national internal revenue code, maintenance of general ledger, general journal, sales book, purchase book, inventory book, utilization of financial reports in measuring financial performance and problems encountered in proper bookkeeping. These practices together with the problems encountered were evaluated in terms of business profiles as well as MSME owners’ demographic profiles. The study was conducted in one of the cities in the Southern Tagalog Region of the Philippines targeting the owner/s of the MSMEs engaged in merchandising or manufacturing businesses. The descriptive design was used to determine the current situation and to establish the existing practices of the MSMEs through a survey coupled with an unstructured interview of the selected respondents. A total of 100 respondents participated in the study and the data gathered were evaluated using some statistical treatments such as frequency distribution, percentage, weighted average mean, t-test, and ANOVA.The data revealed that most of the MSME owners are extremely aware of the proper bookkeeping requirements but due to some constraints, they still failed to comply with statutory requirements. The lack of accounting knowledge and skills also precluded them from utilizing their financial reports in evaluating financial performance to enhance their economic decision making. Based on the responses and findings of the study, the researcher concluded that a Business Sustainability Program for MSME is necessary to enhance their record management program. In doing so, the MSME owners will not only comply with the statutory requirements but will also properly monitor the progress of their respective businesses and enable them to evaluate their financial performance necessary for them to make sound economic decisions.MSME owners are encouraged to obtain basic knowledge in Accounting to be better equipped with skills in measuring financial performance so that they can properly monitor the progress of their business. The researcher developed an enhancement program to help the MSME owners in the monitoring and evaluation of their business operation towards a sustainable partnership with the government in terms of the country’s economic growth.