An Empirical Study on the Performance of Micro and Small Enterprises and the Financial Planning Managerial Practices

Abstract

This research paper is intended to study the performance of micro and small enterprises and the financial planning practices adopted by these enterprises. Financial planning means enabling the enterprise to have the right amount of capital in order that the business operations would not get affected. The businesses must first ascertain the financial objectives of the firm to formulate the policies relating to borrowing and lending, cash control, cash management, inventory management, and credit risk management and other financial activities. The present study is an analytical study and a random sampling technique is used. For the purpose of the study Hyderabad district is chosen and a sample size of 120 micro and small enterprises was taken. The statistical tools used for this study are Spearman Rank correlation, KMO Bartlett’s test and Factor analysis. The results of factor analysis gave two factors to ten variables—Important Aspects of Corporate Taxes (IACT) and Recording Transactions and Credit policy (RTCP).