Effects of Record Keeping on the Growth of Small Scale Enterprises in Abeokuta South Local Government Area, Ogun State, Nigeria

Abstract

The study seeks to find the effects of recordkeeping on the growth of small scale enterprises (SSEs) in Abeokuta Local Government Area, Ogun State, Nigeria. Survey design was used to purposively select 120 (53 males, 67 females) business owners from a population of 170 registered SSEs in the local government registry. A structured questionnaire with a reliability index of 0.76 (Cronbach Alpha) was used to elicit information from the respondents. The businesses were trading, manufacturing, fashion, telecommunications and agriculture. Data was analysed through descriptive statistics like simple percentages, mean and standard deviation. The results revealed that the highest age range of the respondents was 26- 30 years (26.7%) while there were two lowest age ranges< 25 years and 36-40 years (2.5% each). The businesses were mostly between 1- 5 years (68.3%) old, implying that they were mostly start-ups. 31.7% of the businesses were 6 years and above, meaning that the survival rate of older businesses was low.  Majority of the business owners were into manufacturing (35.8%). Despite SSEs owners having a positive attitude towards record keeping, 59.2% of them kept financial records manually by themselves without any professional help. Data also revealed that stock records influence sales growth. Income and expenditure record positively affect the profitability of small scale enterprises while debtors and creditors’ record enhance operational efficiency of SSEs. Consequently, small scale business owners should learn to keep proper financial records to forestall the collapse of their businesses by engaging professional accountants and by using different accounting software.