Abstract
The study aims to provide a better understanding with respect to key institutional environment and challenges associated with the adoption of technology of governance by small and medium enterprises (SMEs) in ten countries of the Association of the Southeast Asia Nations (ASEAN). The empirical data of the study was collected from a survey of 200 professional accountants in 10 ASEAN countries, in-depth interviews with 65 participants including the owners of SMEs, regulators, and government officials in the region. We find that although all ASEAN countries recognize the significant economic role of SMEs, incoherent and contradictory definitions of SMEs across ASEAN countries persist. Beyond this, there is a naive assumption among policy makers and the accounting profession who believe that the success of SME companies is how to become a big company like a multinational firm. Unfortunately, such an assumption has an impact on policy making in support of SMEs. Consequently, training, skills uptakes and technological support provided by the accounting, professional, international, and governmental bodies in the ASEAN also fail to meet the real needs of SMEs from the economic and sustainability perspective of these entities. The study warns that micro-entrepreneurs have been excluded from all accounting service processes, standard-setting processes and government support according to the needs of SMEs. Finally, this study provides recommendations for government agencies, accounting professional bodies and standard setters across the ASEAN to enhance the existing roles of SMEs in the future with the support of sustainable technology of governance.
In this paper the term “technology of governance” refers to the nature and application of accounting and financial information in supporting business planning, performance evaluation and value creation of business entities from multiple perspectives (Kaplan and McMillan, 2021).
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Aburous, D. (2018). IFRS and institutional work in the accounting domain. Critical Perspectives on Accounting. Available at https://doi.org/10.1016/j.cpa.2018.10.001.
ACCA. (2016). SME development in ASEAN. Available at http://www.accaglobal.com/content/dam/ACCA_Global/Technical/smb/pi-sme-development-asean.pdf. Accessed Oct 2018.
Ahmad, K., & Mohamed Zabri, S. (2015). Factors explaining the use of management accounting practices in Malaysian medium-sized firms. Journal of Small Business and Enterprise Development, 22(4), 762–781. https://doi.org/10.1108/JSBED-04-2012-0057
Albert, E. (2017). ASEAN: The Association of Southeast Asian Nations. Council on Foreign Relations, Available at https://www.cfr.org/backgrounder/asean-association-southeast-asian-nations. Accessed June 2018.
Albu, C. N., et al. (2013). Implementation of IFRS for SMEs in emerging economies: Stakeholder perceptions in The Czech Republic, Hungary, Romania and Turkey. Journal of International Financial Management & Accounting, 24(2), 142–185.
Barcelo, Y. (2007). Standard overload blues. CA Magazine, 140(4), 25–30.
Birley, S., & Niktari, N. (1995). The failure of owner-managed businesses: The diagnosis of accountants and bankers. In P. Hemington (Ed.), A survey of small businesses and the reasons for failure. Research Board Institute of CA in England and Wales.
Botzem, S. (2012). The politics of accounting regulations: Organizing transnational standard setting in financial reporting. Edward Elgar Publishing Ltd.
Brown, A. M. (2004). The Milieu of the IASB. Journal of American Academy of Business, 5(1–2), 385–390.
Chin, Y. W., & Lim, E. S. (2018). Policies and performance of SMEs in Malaysia. Journal of Southeast Asian Economies, 35(3), 470–487.
Cleminson, J., & Rabin, E. (2002). The reporting problems faced by small business entities in South Africa. Southern African Accounting Association.
Coetzee, S. (2007, May). IFRS for SMEs: Is small, small enough? Accountancy SA, pp. 32.
Del Baldo, M. (2017). The implementation of integrating reporting IR in SMEs: Insights from a pioneering experience in Italy. Meditari Accountancy Research, 25(4), 505–532.
Dellaportas, S., & Davenport, L. (2008). Reflections on the public interest in accounting. Critical Perspectives on Accounting, 19(7), 1080–1098.
Devi, S. S., & Samujh, S. H. (2015). The political economy of convergence: The case of IFRS for SMEs. Australian Accounting Review, 25(2), 124–138.
ERIA. (2015). Accounting standards for small and medium sized enterprises in ASEAN in Mizunoura K. (Ed.), Economic Research Institute for ASEAN and East Asia. Available at http://www.eria.org/RPR_FY2015_22.pdfSingapore. Accessed Jan 2017.
Fearnley, S., & Hines, T. (2007). How IFRS has destabilised financial reporting for UK non-listed entities. Journal of Financial Regulation and Compliance, 15(4), 394–408.
Gaffikin, M. J. (2008). Accounting theory: Research, regulation and accounting practice (1st ed.). Pearson Education.
Gallhofer, S., Haslam, J., & Kamla, R. (2012). The accountancy profession and the ambiguities of Globalisation in a post-colonial, middle eastern and Islamic context: Perceptions of accountants in Syria. Critical Perspectives on Accounting, 22(4), 376–395.
Hora, J. A., Onkar, R. H., & Adhikari, A. (1997). International accounting standards in capital markets. International Accounting, Auditing, and Taxation, 6(2), 171–190.
Irvine, H. (2008). The global institutionalization of financial reporting: The case of the United Arab Emirates. Accounting Forum, 32(2), 125–142.
Jermakowicz, E., & Gornik-Tomaszewski, S. (2006). Implementing IFRS from the perspective of EU publicly traded companies. Journal of International Accounting, Auditing and Taxation, 15, 170–196.
Kaplan, R. S., & McMillan, D. (2021). Reimagining the balanced scorecard for the ESG Era. Harvard Business Review Digital Articles, (February 3).
Leung, P., Raar, J., & Tangei, G. (2008). Accounting services and SMEs: An Australian Study. Certified Accountants Educational Trust for the Association of Chartered Certified Accountants.
OECD. (2005). OECD SME and entrepreneurship outlook. OECD.
Potter, B. (2013). Forum introduction: Differential reporting. Australian Accounting Review, 23(1), 1.
Pratama, A. (2019). SMEs as the Backbone of Southeast Asia’s Growing Economy, International federation of Accountants. Available at https://www.ifac.org/knowledge-gateway/contributing-global-economy/discussion/smes-backbone-southeast-asia-s-growing-economy
Ram, A., & Newberry, S. (2012). IFRS for SMEs: The IASB’s due process. Australian Accounting Review, 23(3), 3–17.
Ramirez, C., Stringfellow, L., & Maclean, M. (2015). Beyond segments in movement: A “small” agenda for research in the professions. Accounting, Auditing & Accountability Journal, 28(8), 1341–1372.
Ritchi, H., Azis, Y., Adrianto, Z., Setiono, K., & Sanjaya, S. (2019). In-app controls for small business accounting information system: A study of domain understanding. Journal of Small Business and Enterprise Development, 27(1), 31–51. https://doi.org/10.1108/JSBED-12-2018-0372
Sharma, D., & Sharma, U. (2020). Analysis of balanced scorecard usage by private companies, Pacific Accounting Review, Vol. ahead-of-print No. ahead-of- print. https://doi.org/10.1108/PAR-06-2019-0076.
Sian, S., & Roberts, C. (2009). UK small owner-managed businesses: Accounting and financial reporting needs. Journal of Small Business and Enterprise Development, 16(2), 289–305. https://doi.org/10.1108/14626000910956065
Stone, G. (2011). Let’s talk: Adapting accountants’ communications to small business managers’ objectives and preferences. Accounting, Auditing & Accountability Journal, 24(6), 781–809.
Tinker, T., & Carter, C. (2003). Spectres of accounting: Contradictions or conflicts of interest? Organization, 10(3), 577–582.
UNCTAD [United Nations Conference on Trade and Development]. (2008). Accounting and financial reporting guidelines for small and medium-sized enterprises (SMEGA) – Level 3 Guidance. UNCTAD.
Warren, R., Carter, D., & Napier, C. (2019). Opening up the politics of standard setting through discourse theory: The case of IFRS for SMEs. Accounting, Auditing & Accountability Journal, 33, 124–151.
Wilson, A. (1995). A GAAP in understanding. Accountancy, 115(9), 1218.
World Bank. (2019). A small and medium enterprises (SMED) finance. Available at https://www.worldbank.org/en/topic/smefinance. Accessed Jan 2018.
Zhang, Y., & Si, C. (2008). The impacts of external factors on the growth of Chinese entrepreneurial enterprises: An empirical study. Journal of Small Business and Enterprise Development, 15(4), 689–703. https://doi.org/10.1108/14626000810917807
Acknowledgement
The authors thank the ASEAN Federation of Accountants and Chartered Accountants Australia & New Zealand for their finding support for the study.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2023 The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
About this paper
Cite this paper
Harun, H., Carter, D., Khan, H. (2023). Seeking a Sustainable Technology of Governance to Support Small and Medium Enterprises: A Study from the ASEAN Countries. In: Eijdenberg, E.L., Mukherjee, M., Wood, J. (eds) Innovation-Driven Business and Sustainability in the Tropics. SEIGOP 2023. Springer, Singapore. https://doi.org/10.1007/978-981-99-2909-2_2
Download citation
DOI: https://doi.org/10.1007/978-981-99-2909-2_2
Published:
Publisher Name: Springer, Singapore
Print ISBN: 978-981-99-2908-5
Online ISBN: 978-981-99-2909-2
eBook Packages: Business and ManagementBusiness and Management (R0)