Abstract
Small enterprise development strategy is used by governments worldwide for economic development, wealth creation and poverty reduction. The government of Kenya vision 2030 of being a medium income economy is anchored on an ambitious economic development blueprint through economic, social and political pillars. While small enterprises are taunted as part of the catalysts for rapid development, by their nature small enterprises face a myriad of challenges in the collection of financial information through accounting system which is used in business decision making. The study considered the challenges faced by the enterprises in record keeping, the type of accounting systems they use and the role of accounting systems in enterprise development in Makueni County, Kenya. Data for the study was collected from 250 small enterprises through semi-structured questionnaires and analysed using descriptive and inferential statistics. Small enterprises prefer maintaining manual records of accounting systems for recording purchases, sales and expenses. The challenges small enterprises faced were lack of competent clerical staff, time constraints and lack of knowledge on record keeping. A significant linear relationship is evident between accounting systems and enterprise development in Makueni County of Kenya. There is need for the government and other stake holders to intervene in capacity building of small enterprises on accounting practices as a pillar to the development and sustainability of small enterprises in Kenya.
Highlights
Enterprise developments are critical for economic development globally as they catalyze a range of multiplier effects on the economic activities of countries [1]
Small enterprise development strategy is used by governments worldwide for economic development, wealth creation and poverty reduction
While small enterprises are taunted as part of the catalysts for rapid development, by their nature small enterprises face a myriad of challenges in the collection of financial information through accounting system which is used in business decision making
Summary
Enterprise developments are critical for economic development globally as they catalyze a range of multiplier effects on the economic activities of countries [1]. Small enterprises are accepted worldwide as strategies for accelerating economic development, poverty reduction and creating employment [2]. Small enterprise development contributes slightly over 55 percent of the national gross domestic product (GDP) and over 65 percent of total employment among the high income countries [1]. Enterprises thrive in economies where the government policy-makers put in place policies that support business growth. The developed world continues to offer the African continent the lessons on prudent management of small enterprises to foster wealth and employment creation. The policy documents and economic strategies by most African government ministries and departments mandated to oversee enterprise development continue to emphasize on enterprise development [3]
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