Impacts of Financial Management Practices on the Economical Development of Small to Medium Size Forest Enterprises

Abstract

Small and Medium-sized Forest Enterprises (SMFEs) have transitioned toward environmental sustainability due to the rapid evolution of the global economic climate. Researchers have revealed a high failure rate of about 90% worldwide for SMFEs due to poor financial management techniques, even though their performance is crucial for every emerging country. Implementing financial management methods has boosted firm expansion in the literature on the topic. This study fills a knowledge gap within the literature by examining the effect of financial management techniques on the expansion of small and medium-sized enterprises (SMFEs). Financial management, financial analysis, computerized accounting systems and financial investments were the primary areas of inquiry. Two hundred sixty small and medium-sized business owners, financial managers, and other financial staff members filled out questionnaires to obtain the data. The analysis reveals that better financial management, financial reporting, accounting systems, investment decisions, and financing strategies lead to better financial performance and faster growth. The findings also show a robust beneficial relationship between financial management, financial analysis, computerized accounting systems and financial investments is essential to their success and has significant consequences for owners, administrators, and authorities. This research expands on previous discussions of numerous practical aspects and offers suggestions for future investigation.