CHAPTER FOUR

PRSENTATION, ANALYSIS AND INTERPRETATION OF FINDINGS

4.0 Introduction

This chapter presents analysis and interprets the findings based on the study objectives and
questions. It also presents, analysis and interprets findings on record keeping and performance of
small and medium enterprises.

4.1 Respond Rate

The researcher distributed 133 questionnaires, these where from different classes of people
within hill top poultry farm. Out of the 133 questionnaires that where distributed 122
respondents brought back the questionnaires and only 11 did not manage to bring back the
questionnaires therefore, the responds rate was 91.7% these implies that the biggest part of the
study sample gave their views about the topic under the study. The respond rate is shown in the
pie chart below.

Figure 4.1: Response Rate

Response Rate
11

Returned
Not Returned

122

Source: Primary Data 2022

4.2 Demographic Characteristics

4.2.1 Gender

Table 4.1: Showing the Sex of the Respondents

Gender Frequency Percentage

Male 80 66%

Female 42 34%

Total 122 100

Source: Primary Data 2022

Results in table above shows that 66% (80) of the respondents where male and 34% (42) were
female.

4.2.2 Age bracket

Table 4.2: Showing the Age Bracket of the Composition of Respondent.

Age bracket Frequency Percentage

21-30 years 22 18%

31-40 years 52 42%

41-50 years 30 26%

Above 50 years 18 14%

Total 122 100

Source: Primary Data 2022

Results in table above show that 18% (22) of the respondent where between the age of 21-30
years, 42% (52) where between 31- 40, 26% (30) of the respondents where between 41-50 and
finally 14% (18) of the respondent where above 50 years. Therefore, the majority of the
respondents were between the age of 31- 40 years.
4.2.3 Education level

Table 4.3: Showing the level of education attained by different respondents.

Responds Frequenc Percentage

y

Certificate 22 18%

Diploma 42 34%

Bachelors 50 41%

Masters 18 7%

Total 122 100

Source: Primary Data 2022

The results in table above shows that 18% (22) of the respondent had certificate and 34% (42)
had diploma 41% (50) had bachelors and finally 7% (18)of the respondent where for masters.

4.2.4 Working Experience

Table 4.4: The table below shows working experience of respondents.

Working experience Frequenc Percentage

y

Not more than 2 14 11%

years

2-4 years 28 23%

4-6 years 58 48%

6 years and above 22 18%

Total 122 100

Source: Primary Data 2022

Results in table shows that 48% (58) of the respondent had an experience of 4-6 years, 11% (14)
of the respondent had an experience of not more 2 years and 23% (28) of the respondent hade an
experience between 2-4 years and finally only 18% (22) of the respondent had an experience of 6
years this meant that the majority had adequate experience to provide reliable data on the topic
under study.

4.3 The Effects of Maintaining Cashbooks on Profitability of Small-Scale Enterprises

To achieve this objective, the respondents were asked on The Effects of Maintaining Cashbooks
on Profitability of Small-Scale Enterprises. These are presented as follows:

The results in table 4.5 below present the Effects of Maintaining Cashbooks on Profitability of
Small-Scale Enterprises.

Table 4.5: The Effects of Maintaining Cashbooks on Profitability of Small-Scale

Enterprises

Statement Strongly Agree Uncertain Disagree Strongly

agree disagree
Freq % Freq % Freq % Freq % Freq %
Helps in making rational 35 28.7 52 42.6 18 14.8 11 9.01 6 4.9
decisions.

Promotes better financial 31 25.4 53 43.4 21 17.2 9 7.4 8 6.6

management.

Helps to determine the firms 29 23.8 63 51.6 17 13.9 7 5.7 6 4.9

inventory levels.

Promotes managerial skills. 41 33.6 58 47.5 21 17.2 2 1.6 0 0

Helps to determine each 33 27 62 50.8 9 7.4 12 9.8 6 4.9

production units’ output.

Promotes efficiency amongst 25 20.5 72 59 16 13.1 9 7.4 0 0

employees

Source: Primary data, 2022

Results in Table 4.5 above show that 4.9% (6) of the respondents strongly disagreed, 90.1% (11)
disagreed, 14.8% (18) of the respondents were not sure, 42.6% (52) of the respondents agreed
and the remaining 28.7% (32) of the respondents strongly agreed that maintaining cashbook
helps in making rational decisions.
On whether maintaining cashbook promotes better financial management, respondents
strongly/agreed by 68.8% (28.7+42.6), 17.2% (21) were not sure, 7.4% (9) disagreed and only
6.6% (8) strongly disagreed with the statement.

85.4% of the respondents strongly/agreed that maintaining cashbook helps to determine the firms
inventory levels, 13.7% were not sure and 10.6% strongly/disagreed. 81.1% believed that
maintaining cashbook promotes managerial skills, 17.2% were not sure, and 1.6%
strongly/disagreed.

Respondents strongly agreed by 27% that maintaining cashbook helps to determine each
production units’ output, 50.7% agreed, 7.4% were not sure about the statement whereas 9.8 and
4.9 represented disagreed and strongly disagreed respectively.

Lastly, on the statement whether maintaining cashbook promotes efficiency amongst employees,
respondents strongly agreed by 20.5%, 59 agreed, 13.1% were not sure, and lastly 7.4%
disagreed. This implies there’s relatively a great impact of maintaining cashbook on profitability
of Small Scale Enterprise.
4.4 The effect of a general ledger on the growth levels of small-scale enterprises

To achieve this objective, the respondents were asked on the effect of a general ledger on the
growth levels of small-scale enterprises

The results in Table 4.6 below present the effect of a general ledger on the growth levels of
small-scale enterprises.

Table 4.6: The effect of a general ledger on the growth levels of small-scale enterprises

Statement Strongly Agree Uncertain Disagree Strongly

agree disagree
Freq % Freq % Freq % Freq % Freq %
41 33.6 63 51.6 17 13.9 1 0.8 0
A general ledger ensures
complete accuracy in financial
statements used for other
obligations like licenses and tax
filing.

39 32 72 59 9 7.4 2 1.6 0
A general ledger is used to
record statistical data and the
transactions that helps
companies plan for inventory
purchases, develop pricing
strategies, generate financial
reports, and secure financing.

26 21.3 94 77 2 1.6 0 0 0 0
A general ledger is an essential
resource used by audit firms to
detect and prevent fraud.

23 18.9 48 39.3 21 17.2 6 4.9 0 0

General ledgers examine
detailed explanations of each
income and expense record to
ensure that everything is
appropriately classified and
select other items for further
review.

39 32 55 45.1 28 23 0 0 0 0
This detailed information in the
general ledger facilitates
decision-making regarding
financial projections and
business planning based on the
company’s state.

31 25.4 62 50.8 26 21.3 3 2.5 0 0

As the single source of truth, the
general ledger makes it easier
for auditors and accountants to
track down and trail
transactions.

Source: Primary Data, 2022

Results in Table 4.6 above show that 33.6% (41) of the respondents strongly agreed that A
general ledger ensures complete accuracy in financial statements used for other obligations like
licenses and tax filing, 51.6% (63) of the respondents agreed and 13.9% (17) of the respondents
were not sure, 0.8% (1) disagreed. It was revealed that 1.6% of the respondents disagreed, 7.4%
of the respondents were not sure, 32% of the respondents agreed and the remaining 59% of the
respondents strongly agreed that a general ledger is used to record statistical data and the
transactions that helps companies plan for inventory purchases, develop pricing strategies,
generate financial reports, and secure financing. 98.3% of the respondents strongly/agreed that a
general ledger is an essential resource used by audit firms to detect and prevent fraud and the rest
of the respondents were not sure represented by 1.7%. 58.2% believed that general ledgers
examine detailed explanations of each income and expense record to ensure that everything is
appropriately classified and select other items for further review, 17.2% were not sure and 4.9%
strongly/disagreed.

On whether the detailed information in the general ledger facilitates decision-making regarding
financial projections and business planning based on the company’s state, respondents strongly
agreed by 32%, 45.1% agreed, and 23% were not sure with the statement and lastly, respondents
strongly agreed by 25.4% that the general ledger makes it easier for auditors and accountants to
track down and trail transactions 50.8%, 21.3% were moderate and 2.5% strongly. This implies
that general ledger has a great impact on the growth of small scale enterprises.

4.5 The relationship between accounting records and financial performance of small-scale
enterprises.

To achieve this objective, the respondents were asked on the relationship between accounting
records and financial performance of small-scale enterprises.

Table 4.7: The relationship between accounting records and financial performance of
small-scale enterprises.

Statement Strongly Agree Uncertain Disagree Strongly

agree disagree
Freq % Freq % Freq % Freq % Freq %
35 28.7 52 42.6 18 14.8 11 9.01 6 4.9
Record keeping is a key to the
success of a business.
31 25.4 53 43.4 21 17.2 9 7.4 8 6.6
Some business for example
micro and small businesses do
not require recordkeeping.
29 23.8 63 51.6 17 13.9 7 5.7 6 4.9
It is always good to keep record
of all transactions in my
business.

41 33.6 58 47.5 21 17.2 2 1.6 0 0

All goods/services received on
credit are recorded
33 27 62 50.8 9 7.4 12 9.8 6 4.9
Details such as date, transaction
description and amount of
money paid out are recorded
25 20.5 72 59 16 13.1 9 7.4 0 0
Expenses are recorded
according to their nature e.g.
rent, electricity

Source: Primary data, 2022

Results in Table 4.7 above show that 4.9% (6) of the respondents strongly disagreed, 90.1% (11)
disagreed, 14.8% (18) of the respondents were not sure, 42.6% (52) of the respondents agreed
and the remaining 28.7% (35) of the respondents strongly agreed that record keeping is a key to
the success of a business.

On whether some business for example micro and small businesses do not require recordkeeping,
respondents strongly/agreed by 68.8%, 17.2% were not sure, 7.4% disagreed and only 6.6%
strongly disagreed with the statement.

85.4% of the respondents strongly/agreed that it is always good to keep record of all transactions
in my business, 13.7% were not sure and 10.6% strongly/disagreed. 81.1% believed that all
goods/services received on credit are recorded, 17.2% were not sure, and 1.6%
strongly/disagreed.

Respondents strongly agreed by 27% that details such as date, transaction description and
amount of money paid out are recorded, 50.7% agreed, 7.4% were not sure about the statement
whereas 9.8 and 4.9 represented disagreed and strongly disagreed respectively.

Lastly, on the statement whether Expenses are recorded according to their nature e.g. rent,
electricity, and respondents strongly agreed by 20.5%, 59 agreed, 13.1% were not sure and lastly
7.4% disagreed. This implies record keeping has a significant effect on the financial performance
of Small Scale Enterprise.
4.5.1 Regression Analysis

Regression analysis is the method which used to examine the single or more than one
independent variable to explain variance in a dependent variable. This was done to determine the
relationship between book keeping and financial performance.

The independent variables forms of accounting records (Ledger, Cashbook, Journals and
financial statement) are not significantly explaining the variance in financial performance.

4.5.1.1 Model Determination

Table 4.8: Model summary

Model R R Square Adjusted R Std. Error of the

Square Estimate
1 .589a .356 .342 .463
a. Predictors: (Constant), Forms of accounting records like Ledger, Cashbook,
Journals and financial statement.
b. Dependent Variable: Financial Performance
Source: Primary Data (2021)
The R square indicates the extent or percentage the independent variables can explain the
variation in the dependent variable. In this study, independent variables (Forms of accounting
records like Ledger, Cashbook, Journals and financial statement) can explain 35.60% of the
variations in dependent variable (Financial Performance). However, it is still leave 64.40%
(100% - 35.60%) unexplained in this study. In other word, there are other additional variables
that are important in explaining Financial Performance that have not been considered in this
study.
4.5.1.2 Test of Significance
The test of significance was estimated by use of ANOVA as indicated in Table 4.6.
Table 4.9: Analysis of Variance (ANOVA)
Model Sum of Squares df Mean Square F Sig.
Regression 35.035 4 8.759 41.960 .000a
1 Residual 62.929 41 0.160
Total 97.964 45
a. Predictors: (Constant), Accounting Records
b. Dependent Variable: Financial Performance
Source: Primary Data (2022)

Based on the table 4.9 (Analysis of variance), p-value (0.009) is less than alpha value 0.05. The
F-statistic (41.960) is significant. The model for this research is a good descriptor of the relation
between the dependent and predictor variables. Therefore, the independent variables (Ledger,
Cashbook, Journals and financial statement) are significant explain the variance in Financial
Performance. The alternate hypothesis (H1) is supported by the data.

4.5.1.3 Coefficients of the Variables

The results on the regression coefficients of the variables are as indicated in Table below.
Table 4.10: Parameter Estimates
Parameter Estimates
Variable DF Parameter Standard Error t Value Pr>[t]
Estimate
1 1.790 0.348 8.02 0.0000
Intercept
1 0.349 0.154 1.65 0.0038
Ledger

1 0.412 0.158 1.74 0.0031

Cashbook

1 0.583 0.162 1.96 0.0024

Journals

1 0.548 0.157 1.94 0.0022

Financial Statement

Source: Primary Data (2022)

Y = a + bX + b1X1 + b2X2 + b3X3 + b4x3, where Y=1.79+0.349X1 + 0412X2 0.583X3+ 0.548X4.

The findings of the study show significant positive relationship between the two variables
Accounting Records is significant to predict dependent variable (Financial Performance) for this
study. This is because p-value for Ledger is 0.0038 which is less than alpha value 0.05.

Next, Cashbook is significant to predict dependent variable (Financial Performance) for the
study. This is because p-value for cashbook is 0.0031 which is less than alpha value 0.05.

Journal is significant to predict dependent variable (Financial Performance) for this study. This is
because p-value for Journal is 0.0024 which is less than alpha value 0.05.

The financial statement is significant to predict dependent variable (financial performance) for
this study. This is because p-value for financial statement is 0.0022 which is less than alpha
value 0.05. The four independent variables are the factors that determine Financial Performance.
Therefore, from the findings it can be concluded that accounting records have a significant effect
on Financial Performance.
 APPENDICES

QUESTIONNAIRE FOR THE RESPONDENTS

Dear respondent,

This questionnaire is intended to investigate record keeping and organizational performance of

small-scale enterprises. The results are purely meant for academic purposes and will be treated
with utmost confidentiality. You are requested to feel free and give the most appropriate
answers.

Section A: BACK GROUND INFORMATION

Gender

1. Gender:

a) Male [ ]
b) Female [ ]

2. Age bracket

a) 21-30years [ ]

b) 31-40 years [ ]

c) 41-50years [ ]

d) 50 and above [ ]

3. Marital status

a) Married [ ]

b) Single [ ]

c) Divorced [ ]

d) Widow [ ]
4. Highest level of education attained

a) Certificates [ ]

b) Diploma [ ]

c) Bachelors [ ]

d) Masters [ ]

5. For how long have you served this company?

a) Not more than 2years [ ]

b) From 2-4years [ ]

c) From 4-6years [ ]

d) For more than 6years [ ]

SECTION B. THE EFFECTS OF MAINTAINING CASHBOOKS ON PROFITABILITY
OF SMALL-SCALE ENTERPRISES.

In the subsequent sections, use the scales provided to tick or circle a number that describes your
opinion. 1 Strongly agree (SA), 2. Agree(A), 3. Not sure (NS), 4. Disagree(D), 5. Strongly
disagree (SD).

STATEMENT 5 4 3 2 1

Helps in making rational decisions.

Promotes better financial management.

It is used to access loans from the banks.

Helps to determine the firms inventory levels.

Promotes managerial skills.

Helps to determine each production units’ output.

Promotes efficiency amongst employees

SECTION C. THE EFFECT OF A GENERAL LEDGER ON THE GROWTH LEVELS
OF SMALL-SCALE ENTERPRISES.

In the subsequent sections, use the scales provided to tick or circle a number that describes your
opinion 1 Strongly agree (SA), 2. Agree(A), 3. Not sure (NS), 4. Disagree(D), 5. Strongly
disagree (SD).

STATEMENTS 5 4 3 2 1

A general ledger ensures complete accuracy in financial statements

used for other obligations like licenses and tax filing.

A general ledger is used to record statistical data and the transactions

that helps companies plan for inventory purchases, develop pricing
strategies, generate financial reports, and secure financing.

A general ledger is an essential resource used by audit firms to detect

and prevent fraud.

General ledgers examine detailed explanations of each income and

expense record to ensure that everything is appropriately classified
and select other items for further review.

The detailed information in the general ledger facilitates decision-

making regarding financial projections and business planning based
on the company’s state.

As the single source of truth, the general ledger makes it easier for
auditors and accountants to track down and trail transactions.
SECTION D. THE RELATIONSHIP BETWEEN RECORD KEEPING AND
FINANCIAL PERFORMANCE OF SMALL-SCALE ENTERPRISES

In the subsequent sections, use the scales provided to tick or circle a number that describes your
opinion 1 Strongly agree (SA), 2. Agree(A), 3. Not sure (NS), 4. Disagree(D), 5. Strongly
disagree (SD).

STATEMENTS 5 4 3 2 1

Recordkeeping is a key to the success of a business.

Some business for example micro and small businesses do not require
recordkeeping.

It is always good to keep record of all transactions in my business.

All goods/services received on credit are recorded

Details such as date, transaction description and amount of money

paid out are recorded

Expenses are recorded according to their nature e.g. rent, electricity