Empirical Aspects Concerning the Entrepreneurs and Financial Reporting of Romanian SMEs

Abstract

Using financial and accounting information for improving knowledge about firm position and performance and furthermore take proper decisions thereby represents best practices that almost all entrepreneurs/small business owners should acquire. For that matter we attempt to analyze some aspects of the attitude and needs of the entrepreneurs concerning financial accounting information and financial reporting, the entrepreneurs’ preference to certain financial ratios, the extent to which the entrepreneurs use financial statements and accounting information, methods they use when assess liquidity and other aspects regarding practices used in this respect. We designed a questionnaire which was addressed particularly to the Ialomita County entrepreneurs/small business owners for testing six hypotheses in this direction. Based on our quantitative research we found that Romanian entrepreneurs are predominantly profit oriented, pursue to maintain and sustain their businesses, mostly consult and use cash book, statement, centralized data of the receipts and payments and only a small percentage of them use cash flow forecasting in their business activity. Also we found important but not significant correlation between business turnover size and variables such as: frequency of using financial accounting information and frequency of the assessment of liquidity.

Keywords: SMEs, Entrepreneur, Small business owner, Financial reporting, Liquidity, Accounting information