Importance Of The Implementation Of Accounting In Small Businesses

Importance of the implementation of accounting in small businesses

The International Financial Information Standard for small and medium entities (IFRS for SMEs) is issued by the International Accounting Standards Board (IASB).

So that the financial information that is presented in the financial statements of the companies is real and correct must be based on certain types of rules so that for this there are NIF (financial information standards) that are those that include a set ofgeneral concepts and particular norms that regulate the elaboration and presentation of the information contained in the financial statements and that are generalized in a certain place and to a certain date.

“In this sense we have that small and medium enterprises are currently a large part of the productive fabric of each country and it is estimated that more than 90% of all companies in the world are SMEs, which is why the experts who emitrules of presentation of financial statements could not ignore this fact and for this they had to know the true needs of the users of the financial statements the SMEs and thus simplify the standards without neglecting the quality ”.

The advantages are that users of this type of information can be sure of this at the time of delivery and that it is correctly, but as a disadvantage it could be considered that the counters not informing according to the modifications that were on theNIF could commit a lack in the registration and presentation of said information.

According to the block found on the network in 2019, it shows us some important points to take into account to be able to carry your business accounting to implement in small businesses. a) Control total sales in the day and know the income of each day. b) Have a detailed record of administrative, operational and production expenses. c) Know the balance sheet, do you register losses or profits? d) Better manage inventory of both inputs and products so as not to have money invested idle. e) Control expenses in services such as electricity, telephony and water, as well as those made in stationery and other non -productive supplies. f) Check business expenses to avoid unproductive disbursements and also facilitate their deductibility.

To justify the above we have the methodology of mentioning is that of the “double item” that was proposed by Fray Luca Pacioli, where: to support the double item he checked and demonstrated that every commercial operation that would be practiced had a cause, thewhich should necessarily produce an effect, so there was a numerical compensation between cause and effect, respectively ”(Romero Gómez). An advantage that is a simple system to detect errors at the end of making the records and review the total sum, but its disadvantage is that the amounts can be incorrectly noted in accounts with balance of the same nature, for example;When registering a payment to suppliers by error, it can be recorded in creditors.

The inclusion of technologies is the best way to make their businesses more efficient, reduce time and increase the profits of their industries .. Accounting is something essential in a company, considering that for its elaboration you must have concentration and time to be able to carry it out, so in this blog it makes us know some software that can be implemented. The advantages that it gives us are that you can register the information in a faster and more precise way so we can present the financial information on time, but a disadvantage is that one must be used for each function for example there is one forpayrolls and others for the registration of sales, another disadvantage is that not all SMEs has the resource to buy software and do not even have training for their management.

InComputer programs dedicated to company operation. This is why our proposal is to implement the performance valuation methodology so that this form can be hired expert personnel in a certain area, they are asked for a current certification by the manufacturer of said product or service and put it into practice within the organization.

According to accounting theory (Romero López, 2010) he mentions a cyber approach (methodology) where cybernetic communication and control science is made. Having with this the advantage of financial information communication is what returns to the company as a system, integrated and coherent, and the control is the one that regulates its behavior. Cybernetics in financial accounting includes the processes and systems of transformation of information and its concretion in objectives. Its nucleus is the financial information communication system. The main disadvantage would be that not all organizations give the cyber approach to their internal accounting control, resulting in economic lack of control, with this contribution we can understand why most SMEs have been invaded by cyber control.

INTRODUCTION

For many people who want to start their own business, either because they hope to generate a job for them and for their family, or simply the desire to be a self-employed, and not depend on someone to survive.

Some time ago, we were presented with the optimist slogan "I am Pepe, I am Toño and we are entrepreneurs" who was a classic in entrepreneurial advertising. In the world of Pepe and Toño, to be an entrepreneur, just decide and go to adventure. But in life, we are like that, just look around we can notice that during the course of the year countless premises have been opened and closed. What is this about? We wonder, what are the reasons why SMEs do not last long in the market? We can google this concern and we will find countless information or related topics that lead us to the main obstacles faced by entrepreneurs. However, in our country more value is needed to get a business.

Problematic

According to navigation sources, it tells us: the Mexican entrepreneurbusiness and entrepreneurial skills.  

This implies that our entrepreneurs who start a business believe that they have the necessary skills to manage it. However, the lack of information, training and culture in essential aspects of accounting, management or fiscal aspect prevent the jump from a simple commercial activity to a high -impact business.

However, many do not consider it important to address these issues since they only focus on total solid companies, even in Mexico, entities that have no public obligation to give account are called differently, including non -quoted entities and entitiesNo public obligation to account. In 2009, the International Accounting Standards Board (International Accounting Standards Board or IASB) published the International Financial Information Standard (IFRS) for small and medium enterprises (SMEs), which aims to apply toFinancial statements with the purpose of general information of entities that have no public obligation to account.

But why insist on this subject? Well, according to the author tells us “small and medium enterprises (SMEs), are particularly important for Mexico’s economy, not only for their contributions to the production and distribution of goods and services, but also because of the flexibility of adapting to changestechnological ".  

That said, it is important to look for a way to provide basic training in administrative, fiscal, marketing and implement of accounting records, thus being able to keep the use of the technology monitored by some point of sale.

Thus eliminating the different obstacles that exist when undertaking, such is the case of people’s inexperience to properly carry the money from their business or implement accounting within it. Not only because of the initial capital that can be needed to start, but also because once it begins to “take off” and sales grow it is necessary to know how much it has been earned and what to do with that money that has been obtained: if paying debtsor buy more raw material or simply leave as an emergency fund.

Rodrigo Zarate, director of the Doctorate in Management of the EAN University, explains that keeping a record or memory is important because it will help the entrepreneur everything that is happening with his entrepreneurship, “(Zarate) helps him to know if the ventureIt is profitable and also if you are heading where he or she wants to go. Additionally, it will help you know if your product is leaving a utility, or in the event that they are several products, know which of them is the one that is supporting the entire operation or which still does not reach the point of equilibrium ”. A methodology that helps us understand all this is that of the “double item” that was proposed Fray Luca Pacioli, where: to support the double item he checked and demonstrated that every commercial operation that was practiced had a cause, which shouldnecessarily produce an effect, so there was a numerical compensation between cause and effect, respectively ”.

That is why, among the first steps to achieve the success of a business, it is vital to know that movement and bring the appropriate accounts of all transactions that are made especially, because at the beginning, it can be provided to confusion of personal money and thecompany money, which can lead to serious future errors or, simply, a high loss of resources.

And to all this, what problems are we facing? Worst of all, obstacles to the Mexican entrepreneur are increasing. In 2016 we lost 12 places in the Global Entrepreneurship Index, since the conditions to undertake severely worsened with respect to the previous year. However, the 2018 Global Entrepreneurship Index pointed out that the country fell to position 75.

As we can see the MSMEs in Mexico not only have those difficulties but other vulnerable points that put them in danger and could leave them out of the competition. I point out Diana Fernández in an article.

Some connoisseurs of the subject will tell us that there are support for MSME such is the case of the Mexico Emprende program with which a financing for 4,500 million pesos will be offered to help the generation of employment and self-employment, resources that according to information from the program, will bedestined to the development of productive projects in specific population sectors. In this same article it is mentioned that “despite the existence of this type of programs and projects, the reality of many of the businesses that come is that resources arrive when the employer is no longer being able to take advantage of it”, ofaccording to information from the National Association of Independent Entrepreneurs (Anei).

Stop these types of situations, the owners of small and medium bussituation. As we can notice, it is a very serious problem in our country, the existing informal activity level that affects numerous organizations, especially SMEs, which are not exempt in this crime, since sometimes they could overturn the funds that do notThey can justify fiscally.