Question

It is difficult to study the growth of a firm without proper recordings of the proceedings.Discuss the essential of maintaining such activities in detail.

Answer 1

This paper focuses on financial records keeping behavior of registered Small Scale Businesses (SSBs) in the Bolgatanga Municipality. A multistage sampling method was used to select one hundred and twenty (120) respondents. As per the study, majority of SSBs do not keep proper records of their businesses, hence, inability to measure financial performance and position of their businesses. The factors that accounted for the failure of SSBs to keep proper records among others include: lack of knowledge in accounting; expensive to hire qualified accounting staff; exposing financial information for tax; time consuming and inability to quantify the value of proper records keeping and lack of internal control procedures. It was also observed that the volume and value of transactions can influence records keeping behavior of SSBs owners. The study, therefore, recommends that the National Board for Small Scale Industries (NBSSI) should assist small scale business operators to keep proper records by organizing training on proper record keeping for them. The government agencies should sensitize the small scale business operators about the need to keep proper records. A law on financial records of small scale businesses should be passed and strictly enforced. The regulatory bodies should also provide simple accounting manual for the businesses.

Keywords: Book keeping, Small Scale Businesses (SSBs), Financial Performance

Answer 2

It is difficult as it will not reflect the correct position of the firm.

• A firm requires great records to screen the advancement of its enterprise. Records can show whether it is improving, which commodities are being sold, or what transforms one necessity to make.
• Precise business records expand an incentive in various manners by improving benefit, which prompts higher valuations.
• Great records can improve the probability of business achievement. Thus, it is essential for every firm to maintain records, otherwise the growth analysis of the firm will become difficult.