Determinants of Effective Financial Risk Management in Small Business: A Theoretical Framework

Nurulhasanah Abdul Rahman,Rafisah Mat Radzi

doi:10.22610/imbr.v7i2.1143

Abstract

This paper aims to develop a theoretical model of potential determinants of effective financial risk management in small business. In achieving this objective, the methodology used includes library search and analyzing previous literature review on the subject of financial risk management and small business especially in Malaysia case study. The significant variables are namely the leadership, training programs, use of technology, entrepreneurship orientation (EO) and accounting information. This paper also hopes to strengthen the body of knowledge on how financial risk management helps small business towards success, besides to act as a reference for empirical research.

Highlights

What is financial risk management? Why is it important for small business? These are the questions that come across any small business owners whenever financial risk is being discussed
This paper will go in depth on how exactly financial risk management can be fully utilize for small business using proposed framework
The objective of this paper is achieved as an extended theoretical framework on determinants of effective financial risk management is proposed

Summary

Introduction

What is financial risk management? Why is it important for small business? These are the questions that come across any small business owners whenever financial risk is being discussed. This paper will go in depth on how exactly financial risk management can be fully utilize for small business using proposed framework. Stated as educating small business owners on this matter and highlight the significance of having effective financial risk management in business may help to resolve this issue. There is an urgency to study the effective financial risk management in small business so that the business owners may achieve better business performance in future. Significant of study To date, there is a limited pool of resources regarding small business and financial risk management in Malaysia which hinder business owners from a prosperous income. Research Objective To develop an extended theoretical framework on the determinants of effective financial risk management for small business

Literature Review

Findings

Conclusion