Accounting for Small Business Essay

ABSTRACTSMEs play a very weighty role in Indias economy and have a great potential for strengthening the substantive sphere of influence in India. barely there has not been appropriate infrastructure yet which is account statement transcription to show the business feasibility.Traditional business in Indian Villages had been started by a family and ancestors, except has gotten bigger now. This business has many strengths and weaknesses. Based on the origin and background, the proposed- invoice fashionation has been developed. It has been also successfully tested for a month transaction and revised. Adding knowledge management into accounting dust is an alternative way to develop the proposed-accounting placement. The tetrad modes of knowledge creation impart facilitate the business and its owner to add some modules in accounting carcass and to reengineer the business process.See more Distinguish between problem-focused coping and emotion-focused coping Essay openingSma ll business plays a very important role in Indias economy, particularly in aspects increased employment, income generating, economic development. In addition, this sector is considered as a driving force for the rural economy. But until now there are still many problems to hinder the small business growth. Facts in the Asia pacific region revealed that Small and forte Enterprises (SMEs) employ about 60 pct of the act asforce. Only 10 percent of the total companies in Asia Pacific which is a big business, the rest are SMEs. For India, according to Small & Medium Business Corner (SMBC) info in 2012 the numbers of micro, small and medium opening moves develop into 130 Lakhs (http//www.smeindia.net/export_schemes/OverviewofMSME.html) by giving employment to 410 Lakhs people and able to contribute to the total national GDP amounted to 8-9 percent in 2012.Basic problem of management in small business is inability of owners to determine their management agency that appropriate with t he business pick up and development stage. In early stage of business, family management style leads to one-person(prenominal) show. According to improvement of business environment, that conventional style could not be pushed longer.Especially in pecuniary management, the business owners could not be able to separate the financial management of business and family yet. Besides, they have not well planned, managed and reported periodically yet. It is caused by there is no appropriate infrastructure which is accounting system. The meet is that the owners of small business have difficulties to cooperate with external such as bank or some other financial institution. The owners have difficulties to show their feasibility business when they want to propose credit or get ahead a business contract with another business.Based on the importance of an accounting system, this research results a proposed-accounting system which can be applied by owners of small business in India. The pro posed-accounting system is a generic model of get and selling system that should be enhanced according to business need and by occupy to the knowledge management approach.LITERATURE REVIEWACCOUNTING SYSTEMAccording to Gillespie, accounting system is an organization of document, form and report which is managed to provide information for management. Based on that definition, elements of accounting system are documents, forms and reports, but still concern with procedure and internal control. Therefore, proposed-elements in this study will refer to it.SMALL BUSINESSUnder the law of Micro, Small and Medium Enterprises (2008), definition of SMEs in India is explained by the gameboard below. Based on the definition, the research object is categorized as a small business.DEFINITION OF SMES IN INDIAEnterprises industrious in providing or rendering of services (i) A micro endeavor is an enterprisingness where the enthronement in equipment does not go across Rs. 10 lakh (ii) A small enterprise is an enterprise where the enthronisation in equipment is more than Rs.10 lakh but does not exceed Rs. 2 crore and (iii) A medium enterprise is an enterprise where the investment in equipment is more than Rs. 2 crore but does not exceed Rs. 5 crore.Enterprises engaged in the manufacture or production, processing or preservation of goods (i) A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh (ii) A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore and (iii) A medium enterprise is an enterprise where the investment in plant and machinery is more than Rs.5 crore but does not exceed Rs.10 crore.SYSTEM DEVELOPMENTSystem development in this study will add up the three main stepsa.System analysisActivities in this stage are initial study, feasibility study, urgency definition, and specification system arrangement. b.System design After fini shing system analysis, the next activities are system design, system building and system testing. c.System implementation Based on system testing, a revised system will be established. Finally, system is implemented and operated. At this stage, company will conduct maintenance activity.RESEARCH methodologySince this study wants to develop a proposed-accounting system, Research and development approach which is applied in this study is a research program that is followed by a development program. It is a combination of descriptive study that describes the substantial phenomenon in an object and exploratory research that develops a proposed -accounting system. A proposed-accounting system is focused on purchasing and selling system since those are the main activities in the business.The location of this study, Traditional small business in Indian Villages, was chosen on purpose, because this business in the Villages has significantly improved in sales and humane empowering, also go vernment is paying attention by giving assistantship for both management and technology. Primary data of this study was the results of guided interviews and observation.The steps of this study are designed as followa.Initial study earlier research was conducted to comprehend previous studies and literature, guided questionnaire drafting, and Traditional business understanding.b.System requirement definingAt this stage, the data was obtained by interview with business owners and observation directly to the business. By understanding the research object condition and background, also the strength and weakness, the accounting system requirement could be defined.c.Development of proposed-accounting systemAt this stage, development of proposed-accounting system was managed by interviews, observation, and group discussion among owners, researcher and government, related to main accounting system elements, which are document, form and report. In its development, knowledge management appro ach was proposed to use since it can facilitate business daily exercise into business standard operation. The result of this stage was a proposed-accounting system.d.Testing and implementationTesting was accomplished by implementing the proposed system to handle a month transactions. Owners and their staff used it to run transactions of purchasing and selling for a month. By running the system, problems were found and then they were used to revise the system. At this stage, a revised-accounting system was established.e.Conclusions and recommendationsIn the final stage of this study, conclusions and suggestions from all research processes were stated.RESULT AND DISCUSSIONPROFILE OF TRADITIONAL BUSINESS IN INDIAN VILLAGESIndia is one of the major exporter and supplier of handi business deals and gift products to the world market. The Indian handicrafts industry is highly excavate intensive and decentralized, being spread all across the country in rural and urban areas. The sector is considered as the second stupendousst employment-generating sector after agriculture with numerous artisans engaged in craft work on a part-time basis. The industry offers employment to over 6 million artisans, including a large number of women and people from the weaker sections of society.The present day handicraft tradition of India is a perfect example of preoccupation between the tralatitious designs and modern techniques. The fast growing demand for Indian handicraft and gifts products have do this sector a full-fledged large scale organized industry that is growing day by day.HistoryThe rich history of Indias craft tradition has evolved over the centuries offering a bequest of Indian culture promising everything beauty, dignity, form and style. The variety is comprehensive and ranges from age-old stone carvings to modern handicrafts qualification use of glass flints and mirrors. The most popular crafts, include metalware, earthenware, pottery, sculpting, woodwork, hand -printed textiles and scarves, embroidered and crocheted goods, shawls, zari products, stone carving and imitation jewelry.There is a myriad of art and craft traditions in India that depend on social, economic and regional factors. The present spatial relation of the sector in India owes much to the rich crafts history and tradition of the past. Majority of the crafts from the past continues to flourish cod to their utilitarian characteristics, availability to the common people and popularity in domestic and global markets.Today, some of the sectors within the craft industry have even become full fledged industries in their own, like carpet weaving, traditional textile (Banarsi silk sari, Chikankari and so on, gem cutting and polishing, jewelry making, the world famous diamond cutting and polishing industry, brassware, jute products, etc. The growth of these industries is due to their ever-increasing demand and the popularity of Indian crafts in the domestic market and overseas . Gems and jewelry, carpet making, metalware, leather products, jute products etc. are some industries, which are growing rapidly.