BACKGROUND OF THE STUDY
Nigeria is a country greatly endowed with many natural and human resources. The business environment apparently offers opportunities for many entrepreneurial ventures ironically, despite these endowments her state of economic development leaves much to be desired.
Where as an entrepreneurship may not be the nursing factor alone, it is without doubt an important component in the process of economic development. In fact, the start up and development of small scale enterprises remains one of the major ingredients of continued growth in an national economy. Consequently, in the quest for all Nigerians economy development, the role of indigenous entrepreneurship is likely to be much more important in small scale enterprises than in large undertaking that were generally favored by planners in the past.
Perhaps it is the realization of these facts that prompted both the federal and state governments, to have recently been vigorously impressing on the establishment of small scale enterprises. As a good result, there has been an appreciable rise in the start-up of varieties of business ventures, especially the owner manager concerns. Many such business ventures rose sharply and fall, others still struggling to keep their head above water, while some others have managed to make some headways, among others is keeping proper accounting records
The small–scale enterprises consists mostly of individuals sole proprietors, partnership and venture business .These forms have been established for purpose of manufacturing; distributing and retaining innumerable goods and services requires for satisfying the needs and desires of our population at home and outside the country .majority of these forms concentrates theirs attentions on selling various types goods while offices focus on providing services.
The increasing needs and desire of people have caused increase in number of small-scale enterprises that are now operating in Nigeria. Apart from the needs and desire of the people, the present economic situation does not allow People to go into large-scale business, people with little resources embark on small- scale enterprises. Most small-scale entrepreneurs produce their own goods in which they sell the public either in small-quantity or in bulk .
Example of these small-scale are small scale enterprises engaged in the production of the African black soap for bathing, soap for washing clothes and plates etc. Small scale enterprises could also be engaged in production of services for instance, a group of friends with the same skill coming together for the purpose of business. Small-scale enterprises could also be engaged in farming or provision of professional services and a lot more.
All the transactions and contract arising from the various activities stated above must therefore be recorded in proper accounting form in such a manner that profitability of the organization can be ascertain.
The record are to be kept in unit of accountant, that is in terms of money, which acts as a measure for estimating the value of purchases, sale contract for services taxes and rates etc.
Accounting as related to this project topic means the systematic way of recording all economic activities and business transactions by small-scale enterprises in order to present a true and fair view of financial position as well as their profitability for a particular accounting period. However, accounting was defined by the international encyclopedia of social science as the act of classifying and reporting significant events to facilitate effective economic activity. The accounting entity may be a profit seeking business, a government unit or activity, an constitution or any other organization for which financial data will be useful in determining the conduct of it
s affairs.
Finally, given the important of small-scale enterprises and the number of people involved in this type of business. There is great need for proper accounting system to be in place so as to check mate the incidence of failure and poor performances.
1.2 STATEMENT OF THE PROBLEMS
Inadequate accounting records or failure to keep records in business especially small-scale enterprises in Nigeria. For example a business owner who invest N500,000 in his business and realized N600,000 at the end of a period, of N100,000 without taking into consideration all other expenses incurred witch are incidental towards he realization of the profit during the period. For this reason, establishing accrual profit cannot be achieved without proper records of all transactions during the period.
Other problems manifest themselves in the interpretation to nonexistence of accounting record. Many small-scale entrepreneurs and has failed because of their inability to keep and maintain proper accounting records for every part of the business. A small-scale entrepreneur will not know exactly how the business was doing without keeping adequate financial record of the business activities.
1.3 OBJECTIVE OF THE STUDY
The primary aim of this project is to critically observe how proper book keeping and proper accounting records can improve the development of small scale enterprise among Ify and Raphel industries and Nnamdi and co chemist shops in Nigeria .The objective of this study shall among other things include the following
a. Evaluating the accounting records of small-scale enterprise .
b. Critically examination of accounting problems of small scale enterprise in Nigeria.
c. To determine whether proper accounting records can help in development of small scale enterprise.
d. To ascertain if small-scale enterprise derive any benefit by keeping proper accounting records.
e. Making recommendation base on the finding of this study
The objectives are to be placed on records with hope that by so doing, many Nigerians existing on potential small scale enterprise will be better informed about the importance of proper accounting records in development process of small enterprise in Nigeria.
1.4 SIGNIFICANT OF THE STUDY
The role of small-scale enterprises in developing countries is progressively becoming significant in the sense that all available resource in any given situation in the economic well-being of a nation must be developed for industrialization and ultimate consumption, through the small scale business. It is therefore important to train all concerned including employees and entrepreneurs in the management of productive process at their disposal for maximum output .
It is a surprise that many small scale entrepreneurs do not know whether business is operating at a profit or loss. if profit is being maximized, How much is he making? This they frequently do not know could they do better? If they can, how?. These questions are universally being asked no matter the nature of the business or type of service being rendered by the enterprises. The only way that any small-scale enterprises can know whether this business is operating at a profit or loss is by keeping proper accounting records.
This research profit work shall serve as a useful tool for small-scale entrepreneurs and also show small-scale entrepreneurs on how their business size can be expanded. it shall also help small-scale enterprise to understand these factors that influence their growth, For example keeping of proper accounting records in a systematic manner would help the management of small scale enterprises to solve some financial problems that usually face them and it will also help them to benefit from other source of finance for their business like obtaining loans from financial institutions.
Accounting records is not only good, but may be required by law. Government agencies banks and employees may raise legal and financial questions. These questions can be correctly answered when written records of all business activities are kept. The accounting records will show the purpose of giving the runners information on the degree of efficiency or otherwise of its management, how and where it earns most incomes, what trends are in the trade or services concerned and what if any step might be taken to improve its earning capacity. It shall also serve as a direction to me and my fellow students who may wish to become an entrepreneur in future.
1.5 SCOPE OF THE STUDY
This research project shall study some bakery industries within the Lagos Island local government for carrying out this work. And the research work shall cover the following accounting records.
a) Sales day book
b) Sales account
c) Returns inward bank
d) Purchase day book
e) Cash book
f) Petty cash book
g) Ledger and financial accounts
All the book mentioned are expected to be met by small scale enterprises on proper accounting records keeping.
This research project shall also show the proper book keeping and accounting procedures used by small scale enterprises for transactions recording and how they can be improved upon and enhanced
1.6 LIMITATION OF THE STUDY
This research work is limited to the importance and reference of accounting records towards the development of small-scale enterprises. Due to the fact that information supplied by various government agencies are not readily available comprehensive and sometimes are not readily available for public consumption; while information got from entrepreneurs are most times very crude and in-cohesive or some times very difficult to believe. But try as much as possible to reduce this in other to carryout his research work finance and time is also another factor that forced the researcher to limit the study to a certain level and period in other to minimize his expenses and still achieve the aim of his study at the end.
The researcher also encountered problems as a result of the illiteracy of some respondents which ways adequately manage the end of the day in other to complete his work.
RESEARCH HYPOTHESIS
Under this research work, a null hypothesis shall be used. A null hypothesis is one which states that ‘no difference or’ no relationship’ exists between two or more variables.
HYPOTHESIS 1
HO, the entrepreneurs in small-scale enterprises are not keeping proper accounting record.
H YPOTESIS 11
HO, the accounting information gathered in some bakery industries within onitsha and the chemist shops at
ogbete main market are not properly recorded and documented based on standard accounting principle
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