CORRELATION BETWEEN MENTAL ACCOUNTING AND GROWTH OF SMALL BUSINESS ENTERPRISE IN NIGERIA
DOI:
https://doi.org/10.53555/nnbma.v8i3.1240Keywords:
Mental accounting, small-scale enterprise, business growthAbstract
Small-scale enterprises are an essential part of Nigeria's business sector. SMEs have been widely identified as the leading component of every society's economic growth and development. However, the sector has been fraught with numerous challenges in the Nigerian setting. Indeed, poor accounting management is one of the primary limitations linked to the failure and undergrowth in the small business sector. Thus, the present study aimed to investigate mental accounting as an accounting strategy that could enhance the growth of small-scale enterprises in Nigeria. The study employed a cross-sectional survey design. Eighty-seven (n=87) small and medium-scale operators randomly selected from the Enugu state business hub participated in the survey. The respondents completed a self-report questionnaire. A simple linear regression model was used for data analysis. It was found that mental accounting significantly predicted the growth of small-scale businesses in Nigeria. Implications and recommendations are discussed.
References
Abisuga-Oyekunle, O. A., Patra, S. K., & Muchie, M. (2020). SMEs in sustainable development: Their role in poverty reduction and employment generation in sub-Saharan Africa. African Journal of Science, Technology, Innovation, and Development, 12(4). https://doi.org/10.1080/20421338.2019.1656428
Ademola, I. S. (2013). Why small-scale businesses failed as a remedy to the unemployment problem in Nigeria. IOSR Journal of Humanities and Social Science, 8(4). https://doi.org/10.9790/0837-0845661
Adhikara, N. D. (2018). Financial accounting standards for micro, small & medium entities: Implementation and factors that affect it. JEMA: Jurnal Ilmiah Bidang Akuntansi Dan Manajemen, 15(2). https://doi.org/10.31106/jema.v15i2.1126
Afif, M., & Mulyani, S. (2016). Determinants analysis of the importance of accounting, quality of financial statements, and implementation of financial accounting standards for entities without public accountability (SAK ETAP)q on SME Fostered by PT. Telkom TBK. https://doi.org/10.2991/imm-16.2016.1
Aggarwal, P., & Vaidyanathan, R. (2016). Is font size a big deal? A transaction–acquisition utility perspective on comparative price promotions. Journal of Consumer Marketing, 33(6). https://doi.org/10.1108/JCM-10-2015-1587
Ahmad, K. (2012). The use of management accounting practices in Malaysian SMEs. University of Exeter, May.
Akanbi, T. A., & Jonathan, O. A. (2018). Investment in accounting information system and sales growth: An investigation of Nigeria small and medium enterprise. Journal of Accounting and Taxation, 10(6). https://doi.org/10.5897/jat2018.0299
Aladejebi, D. O., & Oladimeji, D. J. A. (2019). The impact of record-keeping on the performance of selected small and medium enterprises in Lagos Metropolis. Journal of Small Business and Entrepreneurship Development, 7(1). https://doi.org/10.15640/jsbed.v7n1a3
Aruwa, D. (2004). Financing options for small and medium scale enterprises in Nigeria. Nigerian Journal of Accounting Research, 1(2).
Ashok, M. L., N., A., & M. S., D. (2020). Emerging trends in accounting: An analysis of the impact of robotics in accounting, reporting, and auditing of business and financial information. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3524486
Assefa, M., Jagannadha, R., & Yohannes, A. (2020). Designing of accounting information system for small and medium enterprises: Application of PLS-SEM. International Journal of Sciences: Basic and Applied Research, 54(3).
Ayodeji, M. A. (2015). Entrepreneurial development barriers in a developing nation: A case study of the Nigerian printing SMEs. Thesis.
Azimkhan, A., Yesentemirov, A., Salimzhanova, B., Aidashev, M., Aitzhanova, D., Taskinbaikyzy, Z., Mukhametzhanova, D., & Kurmanalina, A. (2020). Impact of small and medium-sized entrepreneurship on employment in Kazakhstan. Academy of Entrepreneurship Journal, 26(3).
Barberis, N., & Huang, M. (2001). Mental accounting, loss aversion, and individual stock returns. Journal of Finance, 56(4). https://doi.org/10.1111/0022-1082.00367
Basil, D. Z., & Runte, M. M. (2008). How individuals mentally account for work-time volunteerism: Putting the work into volunteer work. Advances in Consumer Research - European Conference Proceedings, 8.
Cant, M. C., Wiid, J. A., & Kallier, S. M. (2013). Small business owners' perceptions of moral behavior and employee theft in the small business sector of Nigeria. Gender & Behaviour, 11(2).
Celuch, K., Bourdeau, B., Saxby, C., & Ehlen, C. (2014). SME internet use: The moderating role of normative influence. Journal of Small Business Strategy, 24(2).
Chidiebere, M., Chigozie, E., & Abuka, K. (2014). Accounting skills for sustainable development of small and medium scale enterprises in the Taraba State of Nigeria. International Journal of Education Learning and Development, 2(2).
Daferighe, E. E., Offiong, P. E., & Jeremiah, O. O. (2019). Adoption of cutting-edge information technology and development of SMEs in Nigeria. Archives of Business Research, 7(5).
Eniola, A., & Ektebang, H. (2014). SME firms performance in Nigeria: Competitive advantage and its impact. International Journal of Research Studies in Management, 3(2). https://doi.org/10.5861/ijrsm.2014.854
Eppinger, E., & Vladova, G. (2013). Intellectual property management practices at small and medium-sized enterprises. International Journal of Technology Management, 61(1). https://doi.org/10.1504/IJTM.2013.050244
Evers, E., & Imas, A. (2019). Mental accounting, similarity, and preferences over the timing of outcomes. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3452943
Fatoki, O. (2014). The causes of the failure of new small and medium enterprises in South Africa. In Mediterranean Journal of Social Sciences (Vol. 5, Issue 20). https://doi.org/10.5901/mjss.2014.v5n20p922
Gbandi, E. C., & Amissah, G. (2014). Financing options for small and medium firms (SMEs) in Nigeria. European Scientific Journal, 10(1).
Hahnel, U. J. J., Chatelain, G., Conte, B., Piana, V., & Brosch, T. (2020). Mental accounting mechanisms in energy decision-making and behavior. Nature Energy, 5(12). https://doi.org/10.1038/s41560-020-00704-6
Iacob, V.S., & Mironescu, R. (2017). Meanings of small business and its management. Journal of Engineering Studies and Research, 19(4). https://doi.org/10.29081/jesr.v19i4.100
Kowo, S. A., Adenuga, O. A. O., & Sabitu, O. O. (2019). The role of SME development on poverty alleviation in Nigeria. Insights into Regional Development, 1(3). https://doi.org/10.9770/ird.2019.1.3(3)
Kwon, S. Y., & Jang, S. C. S. (2011). Price bundling presentation and consumer's bundle choice: The role of quality certainty. International Journal of Hospitality Management, 30(2). https://doi.org/10.1016/j.ijhm.2010.08.001
Lee, S. H., & Lee, J. E. (2015). Moderating impacts of transaction utility on price, quality, and value relationships. Journal of Foodservice Business Research, 18(4). https://doi.org/10.1080/15378020.2015.1068671
Levav, J., & McGraw, A. P. (2009). Emotional accounting: How feelings about money influence consumer choice. Journal of Marketing Research, 46(1). https://doi.org/10.1509/jmkr.46.1.66
Loureiro, Y. K., & Haws, K. L. (2015). Positive affect and malleable mental accounting: an investigation of the role of positive affect in the flexible expense categorization and spending. Psychology and Marketing, 32(6). https://doi.org/10.1002/mar.20808
Manzoor, F., Wei, L., Nurunnabi, M., & Subhan, Q. A. (2019). Role of SME in poverty alleviation in SAARC Region via Panel data analysis. Sustainability (Switzerland), 11(22). https://doi.org/10.3390/su11226480
McNeill, L. S., Fam, K. S., & Chung, K. (2014). Applying transaction utility theory to sales promotion - the impact of culture on consumer satisfaction. International Review of Retail, Distribution and Consumer Research, 24(2). https://doi.org/10.1080/09593969.2013.830637
Meflinda, A., Mahyarni, M., Indrayani, H., & Wulandari, H. (2018). The effect of social capital and knowledge sharing on the small-medium enterprise's performance and sustainability strategies. International Journal of Law and Management, 60(4). https://doi.org/10.1108/IJLMA-03-2017-0073
Abisuga-Oyekunle, O. A., Patra, S. K., & Muchie, M. (2020). SMEs in sustainable development: Their role in poverty reduction and employment generation in sub-Saharan Africa. African Journal of Science, Technology, Innovation, and Development, 12(4). https://doi.org/10.1080/20421338.2019.1656428
Ademola, I. S. (2013). Why small-scale businesses failed as a remedy to the unemployment problem in Nigeria. IOSR Journal of Humanities and Social Science, 8(4). https://doi.org/10.9790/0837-0845661
Adhikara, N. D. (2018). Financial accounting standards for micro, small & medium entities: Implementation and factors that affect it. JEMA: Jurnal Ilmiah Bidang Akuntansi Dan Manajemen, 15(2). https://doi.org/10.31106/jema.v15i2.1126
Afif, M., & Mulyani, S. (2016). Determinants analysis of the importance of accounting, quality of financial statements, and implementation of financial accounting standards for entities without public accountability (SAK ETAP)q on SME Fostered by PT. Telkom TBK. https://doi.org/10.2991/imm-16.2016.1
Aggarwal, P., & Vaidyanathan, R. (2016). Is font size a big deal? A transaction–acquisition utility perspective on comparative price promotions. Journal of Consumer Marketing, 33(6). https://doi.org/10.1108/JCM-10-2015-1587
Ahmad, K. (2012). The use of management accounting practices in Malaysian SMEs. University of Exeter, May.
Akanbi, T. A., & Jonathan, O. A. (2018). Investment in accounting information system and sales growth: An investigation of Nigeria small and medium enterprise. Journal of Accounting and Taxation, 10(6). https://doi.org/10.5897/jat2018.0299
Aladejebi, D. O., & Oladimeji, D. J. A. (2019). The impact of record-keeping on the performance of selected small and medium enterprises in Lagos Metropolis. Journal of Small Business and Entrepreneurship Development, 7(1). https://doi.org/10.15640/jsbed.v7n1a3
Aruwa, D. (2004). Financing options for small and medium scale enterprises in Nigeria. Nigerian Journal of Accounting Research, 1(2).
Ashok, M. L., N., A., & M. S., D. (2020). Emerging trends in accounting: An analysis of the impact of robotics in accounting, reporting, and auditing of business and financial information. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3524486
Assefa, M., Jagannadha, R., & Yohannes, A. (2020). Designing of accounting information system for small and medium enterprises: Application of PLS-SEM. International Journal of Sciences: Basic and Applied Research, 54(3).
Ayodeji, M. A. (2015). Entrepreneurial development barriers in a developing nation: A case study of the Nigerian printing SMEs. Thesis.
Azimkhan, A., Yesentemirov, A., Salimzhanova, B., Aidashev, M., Aitzhanova, D., Taskinbaikyzy, Z., Mukhametzhanova, D., & Kurmanalina, A. (2020). Impact of small and medium-sized entrepreneurship on employment in Kazakhstan. Academy of Entrepreneurship Journal, 26(3).
Barberis, N., & Huang, M. (2001). Mental accounting, loss aversion, and individual stock returns. Journal of Finance, 56(4). https://doi.org/10.1111/0022-1082.00367
Basil, D. Z., & Runte, M. M. (2008). How individuals mentally account for work-time volunteerism: Putting the work into volunteer work. Advances in Consumer Research - European Conference Proceedings, 8.
Cant, M. C., Wiid, J. A., & Kallier, S. M. (2013). Small business owners' perceptions of moral behavior and employee theft in the small business sector of Nigeria. Gender & Behaviour, 11(2).
Celuch, K., Bourdeau, B., Saxby, C., & Ehlen, C. (2014). SME internet use: The moderating role of normative influence. Journal of Small Business Strategy, 24(2).
Chidiebere, M., Chigozie, E., & Abuka, K. (2014). Accounting skills for sustainable development of small and medium scale enterprises in the Taraba State of Nigeria. International Journal of Education Learning and Development, 2(2).
Daferighe, E. E., Offiong, P. E., & Jeremiah, O. O. (2019). Adoption of cutting-edge information technology and development of SMEs in Nigeria. Archives of Business Research, 7(5).
Eniola, A., & Ektebang, H. (2014). SME firms performance in Nigeria: Competitive advantage and its impact. International Journal of Research Studies in Management, 3(2). https://doi.org/10.5861/ijrsm.2014.854
Eppinger, E., & Vladova, G. (2013). Intellectual property management practices at small and medium-sized enterprises. International Journal of Technology Management, 61(1). https://doi.org/10.1504/IJTM.2013.050244
Evers, E., & Imas, A. (2019). Mental accounting, similarity, and preferences over the timing of outcomes. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3452943
Fatoki, O. (2014). The causes of the failure of new small and medium enterprises in South Africa. In Mediterranean Journal of Social Sciences (Vol. 5, Issue 20). https://doi.org/10.5901/mjss.2014.v5n20p922
Gbandi, E. C., & Amissah, G. (2014). Financing options for small and medium firms (SMEs) in Nigeria. European Scientific Journal, 10(1).
Hahnel, U. J. J., Chatelain, G., Conte, B., Piana, V., & Brosch, T. (2020). Mental accounting mechanisms in energy decision-making and behavior. Nature Energy, 5(12). https://doi.org/10.1038/s41560-020-00704-6
Iacob, V.S., & Mironescu, R. (2017). Meanings of small business and its management. Journal of Engineering Studies and Research, 19(4). https://doi.org/10.29081/jesr.v19i4.100
Kowo, S. A., Adenuga, O. A. O., & Sabitu, O. O. (2019). The role of SME development on poverty alleviation in Nigeria. Insights into Regional Development, 1(3). https://doi.org/10.9770/ird.2019.1.3(3)
Kwon, S. Y., & Jang, S. C. S. (2011). Price bundling presentation and consumer's bundle choice: The role of quality certainty. International Journal of Hospitality Management, 30(2). https://doi.org/10.1016/j.ijhm.2010.08.001
Lee, S. H., & Lee, J. E. (2015). Moderating impacts of transaction utility on price, quality, and value relationships. Journal of Foodservice Business Research, 18(4). https://doi.org/10.1080/15378020.2015.1068671
Levav, J., & McGraw, A. P. (2009). Emotional accounting: How feelings about money influence consumer choice. Journal of Marketing Research, 46(1). https://doi.org/10.1509/jmkr.46.1.66
Loureiro, Y. K., & Haws, K. L. (2015). Positive affect and malleable mental accounting: an investigation of the role of positive affect in the flexible expense categorization and spending. Psychology and Marketing, 32(6). https://doi.org/10.1002/mar.20808
Manzoor, F., Wei, L., Nurunnabi, M., & Subhan, Q. A. (2019). Role of SME in poverty alleviation in SAARC Region via Panel data analysis. Sustainability (Switzerland), 11(22). https://doi.org/10.3390/su11226480
McNeill, L. S., Fam, K. S., & Chung, K. (2014). Applying transaction utility theory to sales promotion - the impact of culture on consumer satisfaction. International Review of Retail, Distribution and Consumer Research, 24(2). https://doi.org/10.1080/09593969.2013.830637
Meflinda, A., Mahyarni, M., Indrayani, H., & Wulandari, H. (2018). The effect of social capital and knowledge sharing on the small-medium enterprise's performance and sustainability strategies. International Journal of Law and Management, 60(4). https://doi.org/10.1108/IJLMA-03-2017-0073
Adhikara, N. D. (2018). Financial accounting standards for micro, small & medium entities: Implementation and factors that affect it. JEMA: Jurnal Ilmiah Bidang Akuntansi Dan Manajemen, 15(2). https://doi.org/10.31106/jema.v15i2.1126
Afif, M., & Mulyani, S. (2016). Determinants analysis of the importance of accounting, quality of financial statements, and implementation of financial accounting standards for entities without public accountability (SAK ETAP)q on SME Fostered by PT. Telkom TBK. https://doi.org/10.2991/imm-16.2016.1
Aggarwal, P., & Vaidyanathan, R. (2016). Is font size a big deal? A transaction–acquisition utility perspective on comparative price promotions. Journal of Consumer Marketing, 33(6). https://doi.org/10.1108/JCM-10-2015-1587
Ahmad, K. (2012). The use of management accounting practices in Malaysian SMEs. University of Exeter, May.
Akanbi, T. A., & Jonathan, O. A. (2018). Investment in accounting information system and sales growth: An investigation of Nigeria small and medium enterprise. Journal of Accounting and Taxation, 10(6). https://doi.org/10.5897/jat2018.0299
Aladejebi, D. O., & Oladimeji, D. J. A. (2019). The impact of record-keeping on the performance of selected small and medium enterprises in Lagos Metropolis. Journal of Small Business and Entrepreneurship Development, 7(1). https://doi.org/10.15640/jsbed.v7n1a3
Ahmad, K. (2012). The use of management accounting practices in Malaysian SMEs. University of Exeter, May.
Akanbi, T. A., & Jonathan, O. A. (2018). Investment in accounting information system and sales growth: An investigation of Nigeria small and medium enterprise. Journal of Accounting and Taxation, 10(6). https://doi.org/10.5897/jat2018.0299
Aladejebi, D. O., & Oladimeji, D. J. A. (2019). The impact of record-keeping on the performance of selected small and medium enterprises in Lagos Metropolis. Journal of Small Business and Entrepreneurship Development, 7(1). https://doi.org/10.15640/jsbed.v7n1a3
Aruwa, D. (2004). Financing options for small and medium scale enterprises in Nigeria. Nigerian Journal of Accounting Research, 1(2).
Ashok, M. L., N., A., & M. S., D. (2020). Emerging trends in accounting: An analysis of the impact of robotics in accounting, reporting, and auditing of business and financial information. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3524486
Assefa, M., Jagannadha, R., & Yohannes, A. (2020). Designing of accounting information system for small and medium enterprises: Application of PLS-SEM. International Journal of Sciences: Basic and Applied Research, 54(3).
Ayodeji, M. A. (2015). Entrepreneurial development barriers in a developing nation: A case study of the Nigerian printing SMEs. Thesis.
Azimkhan, A., Yesentemirov, A., Salimzhanova, B., Aidashev, M., Aitzhanova, D., Taskinbaikyzy, Z., Mukhametzhanova, D., & Kurmanalina, A. (2020). Impact of small and medium-sized entrepreneurship on employment in Kazakhstan. Academy of Entrepreneurship Journal, 26(3).
Barberis, N., & Huang, M. (2001). Mental accounting, loss aversion, and individual stock returns. Journal of Finance, 56(4). https://doi.org/10.1111/0022-1082.00367
Basil, D. Z., & Runte, M. M. (2008). How individuals mentally account for work-time volunteerism: Putting the work into volunteer work. Advances in Consumer Research - European Conference Proceedings, 8.
Cant, M. C., Wiid, J. A., & Kallier, S. M. (2013). Small business owners' perceptions of moral behavior and employee theft in the small business sector of Nigeria. Gender & Behaviour, 11(2).
Celuch, K., Bourdeau, B., Saxby, C., & Ehlen, C. (2014). SME internet use: The moderating role of normative influence. Journal of Small Business Strategy, 24(2).
Chidiebere, M., Chigozie, E., & Abuka, K. (2014). Accounting skills for sustainable development of small and medium scale enterprises in the Taraba State of Nigeria. International Journal of Education Learning and Development, 2(2).
Downloads
Published
Issue
Section
License
Copyright (c) 2022 Journal of Advance Research in Business Management and Accounting
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Terms & Condition
Submission -
Author can submit the manuscript through our online submission process or email us at the designated email id in contact details.
The other mode of submission not accepted than online and email.
Before submission please read the submission guidelines.
NN Publication accepts only article submitted in pdf/doc/docx/rtf file format. Another format except given file formats will no be considered .
Author will be responsible for the error mistakes in the submission files. The minor changes can be done without any cost after publication. But for major changes NN Publication may charges you the editing charges.
Publication (Online) -
The online publication is scheduled on last date of every month, but it can be delayed by 24 to 48 hours due to editorial process if huge number of articles comes to publish in single issue.
Automatic notificatation email will be sent to the all users on publication of an issue, so its author’s duty to check their email inbox or SPAM folder to get this notification.
After publication of article author can not withdraw their article.
If editor’s found any issue after publication of article then the NN Publication have the authority to remove the article from online website.
No refund will be provided after online publication of article.
Publication (Print) -
The print copy publication are sent as per the author’s request after 2 weeks of online publication of that issue.
NN Publication will ship the article by India Post and provide the consignment number on dispatch of print copy.
NN Publication follows all the guidelines of delivery provided by IndiaPost and hence not responsible for delay in delivery due to any kind of reasons.
Refund of hard copy will not be provided after dispatch or print of the journal.
NN Publication will be responsible for raise a complain if there is any issue occurs in delivery, but still will not be responsible for providing the refund.
NN Publication will be responsible to resend the print copy only and only if the print copy is lost or print copy is damaged in delivery / or there is delay more than 6 months.
According to India Post the delivery should be completed with in 1-3 weeks after dispatch of articles.
Privacy Policy-
NN Publicationl uses the email ids of authors and editors and readers for sending editorial or publication notification only, we do not reveal or sell the email ids to any other website or company.
