Abstract
This paper aims to carry out a systematic study on the effects in European small and medium-sized enterprises (SMEs). Financial Statement of the 2003 acute respiratory syndrome (SARS) epidemic to project the impact of the coronavirus on budgets. The financial statements of the European SMEs are examined, dividing them by geographical area and sector, comparing the performances of 2002 and 2003. The SMEs operate in the tourism and travel sectors. Changes may be seen in assets, capital, liabilities, and net profit. Furthermore, the paper analyzes the impact between the SARS epidemic and Financial Statement performance qualitatively. Then, according to content analysis, the effects on assets, liabilities, capital and net profit are estimated in the budgets of the SMEs following the coronavirus. The research argues that the magnitude of the impact of SARS on European SMEs was far less than what the main reports and analyses indicate. This experiment provides valuable lessons on predicting the budgetary consequences of future outbreaks, such as the ongoing coronavirus, and on the steps of control or prevention.
Highlights
Small and medium-sized enterprises (SMEs) are the backbone of any economy globally
At the time of writing, there is an outbreak of a deadly new coronavirus known as COVID-19, which has the potential of affecting the balance sheets of SMEs, those that operate in the tourism and travel sectors (Hoque et al, 2020)
This study sought to investigate the effects of the 2003 Severe Acute Respiratory Syndrome (SARS) on the financial statements of several European SMEs so as to highlight how the coronavirus will impact on the budgets of such companies today
Summary
Small and medium-sized enterprises (SMEs) are the backbone of any economy globally They provide a potential source for economic growth. The European Commission defines a SME as a business with a workforce of fewer than 250 people (European Commission, 2020) They operate in all sectors of the economy. With its epicentre in Wuhan City in China’s Province of Hubei, this contagious illness has spread to over 40 countries around the globe (World Health Organization, 2020; Zhu, 2020). It is transmitted employing direct contact with respiratory droplets of a person who has contracted the disease generated when one sneezes or coughs (UNICEF, 2020). A comparable disease that has occurred in the past is the Severe Acute Respiratory Syndrome (SARS), whose outbreak was in 2003, despite is lower spread than COVID-19 (Liu et al, 2020)
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