Financial Management Practices of Hog Raising Business in Rosario, Batangas

Abstract

The study aims to assess the effectiveness of the financial management practices of a hog raising business in Rosario, Batangas. The descriptive-survey method of research was utilized in the study. Respondents were composed of 181 piggery owners/hog raisers in Rosario, Batangas. Majority of the respondents were sole proprietors, with acapital of P1,000,001- P3, 000,000, and have 6-10 years of existence, with 1-5 employees and had raised 51-100 hogs in a year. Financial management practices in terms of Fund Source, Cash Management, Working Capital Management, and Financial Risk were effective whereas Financial Reporting and Analysis and Accounting Practices were somewhat effective. There were no significant differences in the respondents’ assessment on the effectiveness of financial management practices on hog raising business when grouped according to the average number of hogs raised for the past one year. The study also notes several differences on Financial Risk, Accounting Practices and Cash Management when grouped according to form of business and capitalization respectively. Furthermore, there were significant differences on Fund Source and Cash Management, when grouped according to number of years in operation and number of employees. The researcher recommends that hog raisers should separate their business and personal funds in order to easily recognize their income. Owners should consider hiring an accountant to do the financial statements of the business to obtain a more organized and systematized record of financial data and invest to computer based software to allow the business to process their accounts with greater speed and accuracy. Moreover, owners should consider having separate personnel for handling cash and for handling accounting records for internal control procedures. Having cash disbursement system also needs to be considered to have an efficient and secure handling of business’ cash payments. Business owners should also conduct an analysis to assess change in business profits and owner’s equity every quarter to evaluate businesses past income performance and assess the uncertainty of future cash flows. Finally, future research and policy directions in respect of training and capacity development targeting specifically business segment differences should also be conducted to gauge level of knowledge in handling business in terms of financial management.