Determinants and Impact of Recordkeeping to Agribusiness Growth: A Study on Public Marketsmall and Micro Enterprises in Los Baños, Laguna

Date

5-2017

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Hanna D. Miranda

Committee Member

Juan Paulino S. Trespalacio, Junior, Arlene C. Gutierrez, Agnes T. Banzon, Dinah Pura T. Depositario

Abstract

Since recordkeeping is one of the consistent limitations in the applied economics and management fields such as agribusiness and agricultural economics, the study aimed to shed light to the factors affecting the decision of an entrepreneur to use a recordkeeping system and establish its relationship with enterprise growth. The research utilized both quantitative and qualitative data for its exploratory-case research design.

Generally, the intention of this Special Problem Research Report is to determine the factors affecting recordkeeping and establish its role to agribusiness enterprise growth, particularly of public market small and micro enterprises in Los Baños, Laguna. The research fulfilled this through its objectives: (1) present an overview of the study area and the enterprise profiles, (2) describe the recordkeeping practices of the enterprises, (3) determine the factors affecting decision to keep records, (4) establish the relationship between recordkeeping and enterprise growth of the enterprises, and (5) formulate recommendations to improve recordkeeping practices.

Using a controlled non-probability sampling method, the study interviewed 120 public market enterprises in Los Baños, Laguna using stratified quota based on Delphi-measured estimated populations. Data were mainly gathered using various research instruments such as questionnaires and data collection software. Majority of the respondents came from two public markets—Poblacion Public Market and Batong Malake Public Market with some coming from other parts of Los Baños.

An overview of the socio-demographic profile and enterprise environment of the respondents was accomplished. The study observed that most of the respondents were middle-aged and were living in an average household size of 4.67. Most entrepreneurs were female and married. Most sourced their business knowledge from their family. It was also observed that majority of the respondents had at least entered high school level. Of the enterprises included in the study, at most two-thirds (65%) of the respondents were micro enterprises and that 54 respondents employed at most one helper. Most of the enterprises interviewed were operating from 10 to 19 years. Furthermore, more than one- third (45%) of the retailers operated their business from 13-16 hours daily. Majority of the retailer respondents were vegetable vendors; others were in meat, fruits, sari-sari, rice and feeds retailing enterprises.

Using qualitative method of analysis, the practice of recordkeeping was assessed from attitude level to input step then process step until the output step. The study found out that despite positive attitudes towards recordkeeping, there were still many who were not keeping records even at the input level. The study established that out of 120 respondents, one-third (40) of the entrepreneurs recorded transactions daily but only few entrepreneurs (18%) continued to the processing step such as posting of ledgers and trial balance. The latter activities were done by bookkeepers to enable more efficient operations of the enterprise since the owners were said to be more engaged in the day-to-day operations than in the paperwork. For the output step, only 20 (24%) of the respondents produced financial statements. It was also found out that city tax assessors did not base their taxes on the entrepreneurs’ financial reports since most were not preparing such, but did arbitrary tax assessments which is prone to graft and corruption.

To establish whether recordkeeping was determined by socio-demographic factors and the enterprise environment, multinomial logistic regression was used. It was found out that higher initial capital, higher educational attainment, lower age and level of value addition influence recordkeeping significantly. Furthermore, having positive attitude increased profitability by 36.19%, daily daybook use by 62.81%, regular daybook processing by 74.20% and financial statement preparation by 74.32%—these were due to the quality of financial information derived from each step towards effective decision making such as on investment and financing. The study concluded from a trend analysis done, that a step forward on the recordkeeping practice increases profitability.

Therefore, microfinancing institutions should not merely focus on lending funds but also on business trainings to ensure repayment and growth. It was also recommended that further studies and specialization in agricultural accounting be pursued both by practice and in the academe. To sustain the enterprises’ growth, more formal and standard recordkeeping but easier to comprehend techniques are needed by the enterprises. It was also recommended that enabling laws for improvement of the MSME sector through proper bookkeeping be promoted especially for the agribusiness sector.

Language

English

LC Subject

Business enterprises-- Philippines, Records--Management

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2017 M17 C84

Notes

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Document Type

Thesis

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