GRADUATE SCHOOL

MASTER IN BUSINESS ADMINISTRATION PROGRAM

Notre Dame of Midsayap College

Midsayap, Cotabato

JOURNAL CRITIQUE 1

In Partial Fulfillment of the Requirements in the Subject

BA 620: MANAGEMENT ACCOUNTING

KRISZLE E. LAGING

JEROME C. ORILLOSA, CPA, MBA

PROFESSOR
December 19, 2021
Case Title: Analysis of Differences Between Financial Management In Family And
Non-Family SMEs Of Yucatecan Textile Industry

A. What were the underlying issues or major ideas and concepts presented in the
paper? Explain.

The issues and major concepts presented in the paper is focused in

analyzing the main differences between financial management in family and
non-family SMEs in the textile industry in the state of Yucatecan, wherein it
discusses that the family SMEs in the Yucatan textile industry have been
operational for 10 years and are under the direction and ownership of the first
family generation, thus, it is important to find mechanism to enable the same
people to continue in the long-term and avoid becoming part of 70% who do
not survive the first generational change wherein it mentioned that as 30-35
years after the founding of a family business, a generational shift occurs, with
30% of such businesses surviving alongside the second generation and only
13% alongside the third. It also mentioned that in the Latin America over 95%
of companies are SMEs supports that nine out of ten SMEs are family-owned
and adds that these businesses usually have shorter lives than non-family
SMEs.

The paper also presented the variables such as sales growth, the use of
accounting and financial information, and the implementation of MCS as
strategic and sustainable factors for business competitiveness were
considered to see the differences in financial management in family and non-
family SMEs in the textile industry in the state of Yucatecan.

B. What was the nature of the paper (exploratory, descriptive, causal, case study,
etc.)? Explain.

The paper's nature was determined by the study's breadth of scope; it was
 largely an exploratory study, as it aimed to thoroughly analyze a topic which is
the difference between financial management in family and non-family SMEs,
which it was not well defined. It is carried out to gain a better knowledge of the
current problem, but the results will not be conclusive. It also lays the
groundwork, hypothesizes, or uncovers a problem that the researcher suspects
exist. Because the research has never been done before, no similar study has
been conducted before and therefore there were no basis for comparison. As a
result, it seeks to obtain a deeper knowledge of this unknown concept, as well as
to demonstrate that it exists in substantial ways/amounts and to investigate other
topics related to it.

C. What were the findings of the paper? Explain.

The findings of the paper

D. What contributions does the paper make to the advancement of knowledge,

theory, and practice? Why?

The paper presents the relationship of financial decisions and the

differences thereof depending on if the business is family-owned or not. By its
conclusion, a non-family-owned business is more likely to have a better sales
growth than the alternative. This knowledge reinforces that one factor of a
business' success relies on agency costs with regards to financial management.
However, it should be noted that it is still one factor out of many, and further
study of the matter focusing on other factors should be conducted.

E. What are the limitations of the paper? Explain.

One of the paper's limitations is that, because no previous research has

been done, more and deeper research on a specific topic of the study is
required in order to broaden the scope of the study and conclude it. Another
 limitation is that financial management is the foundation of the study, but it is
only focused on sales growth; it could also study other areas of financial
management.

F. Can the findings of the paper have a potential for future research in the
Philippine settings? Explain.

Most of the businesses in the Philippines, especially SMEs, are family

owned, that is why this paper would have great potential to be a basis for any
future research based on the Philippines. By doing the research with a more
local setting, the findings and conclusions may be more tailored to Philippine
businesses, and in turn may create more branches that can be studied further.