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ACCOUNTING SERVICES AND THE FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN NIGERIA
ABSTRACT
The research work was embarked upon with the primary objective of analyzing the relationship between accounting services, majorly the use of management consultancy services and costing services on the financial performance of SMEs in Lagos State and Ogun State, Nigeria.
Three theories were used in the study, namely theories of real income, asymmetric information theory and unified theory of acceptance and usage of technology (UTAUT).
The study used quantitative method. Questionnaire were used in the study for proper analysis and interpretation of data collected from the respondents. All questionnaire were carefully analyzed with frequencies and percentages and were calculated using Statistical Package for Social Sciences (SPSS) version 20. The reliability of the research was checked which gave 75.8%and this makes it reliable. The data were also analysed using Pearson’s product moment Correlation coefficient, also using Statistical Package for Social Sciences (SPSS).
The findings reveals that: There is no significant relationship between management consultancy services and the return on assets of SME’s (0.088 > 0.05). There is a significant relationship between outsourcing of accounting services and the performance of SME’s (0.014 < 0.05). There is no significant relationship between costing services and the financial performance of SME’s 0.132 > 0.05.
The study concluded that: Outsourcing of accounting services is necessary for the improvement of financial performance and Management Consultancy services and costing does not have an important role to play in the financial performance of SMEs. The study further recommends that; Individuals should be enlightened on the changes in the trend of accounting services and the importance of the accounting services. The relevant accounting standards of SMEs should be propounded.

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THESTUDY
Accounting services are very pertinent in ascertaining the profitability, financial position and tax liability of business organizations. It utilizes contemporary techniques, for example, monetary explanations and bookkeeping programming or by utilization of customary strategy which is fundamentally stewardship bookkeeping. Bookkeeping forms are implanted in each business, that is, each business needs bookkeeping administrations since they profit and it has regularly been alluded to as’ the dialect of organizations’. Experts in Accounting are frequently observed as obvious makers of significant worth in associations. This is vital for extraordinary execution. The bookkeeping bureau of an association can gauge the productivity, effectiveness and budgetary position of the organization by handling the money related records of the organization. They additionally help detail money related techniques for the business associations as a result of the information of the budgetary drivers and they likewise look for open doors for long haul achievement (Association of Certified Chartered Accountants, 2013).
Be that as it may, most examinations have been done on enormous organizations and ventures and they neglect to investigate the activities of Small and Medium Scale Enterprises (SMEs). SMEs’ level of execution and viability should be examined. It is accepted, some of the time that the bookkeeping needs of Small and Medium Enterprises are only to record purposes yet it is more than that. The Accounting administrations are foremost a direct result of the apropos needs of the partners and the business.
When SMEs begin their tasks, their money related capacities are worked to ensure that there is consistence with the significant bookkeeping guidelines and standards. As the business develops, the bookkeeping capacities windup institutionalized and the business procedure ends up less demanding to screen then from that point the bookkeeping capacity starts to achieve its potential. It is likewise essential to observe the issuance of new guidelines known as International Financial Reporting Standards and it is additionally fundamental for organizations to report their money related position as per the norms. In any case, this isn’t the situation as the information of these guidelines isn’t controlled by a great deal of people.
There are different definitions of Small and Medium Enterprises (SMEs), this is because different criteria have been used to define it (Ayozie, 2013). It is agreed that SMEs are big businesses when integrated (ACCA, 2013).
Small and Medium Enterprises (SMEs) are rapidly become very prominent. The existence of small and medium enterprises is very essential to the development of countries and the economies (Onugu, 2005).The establishments of SMEs boost the economy of the country because they provide income for the country through taxes. They may also be involved in foreign direct investment which improves the image of the country. This is the reason a close study of Small and Medium Enterprises is needed.
There is quite a lot of pressure on small and medium enterprises to provide a balanced report of their financial performance, this is because the establishment of SMEs has improved and will continue to improve the economies of countries (Ezeagba, 2017).
This study primarily centers on the roles of accounting services and how it affects the performance of SMEs in Nigeria as it is shown that SMEs are very important to the economy.
1.2 STATEMENT OFPROBLEM
The research problem is that the scope is limited. This is as a result of limited time for the research. Hence, accessibility to more SMEs is not possible.
The problem areas that stimulated interest in this research topic are the low performance, inefficiency and the convergence to IFRS that is associated with SMEs. These issues are discussed more concisely below:
SMEs are crucial to the development of the market economy. SMEs are sometimes referred to as essential participants in the development of local and regional areas. Despite government institutional and policies support to enhancing the capacity of small and medium scale enterprises, small and medium scale enterprises has fallen short of expectations(Fatai, 2015).
They also have an important role to play in the economy of our countries and even the world. This is a major reason why accounting information is necessary. It provides necessary information to monitor the development of the SMEs. They are the backbone of economies in countries all around the world. SMEs are an important drive for economic development and empowerment of local communities (Tambunan, 2014). They cut a cross a variety of fields such as trade, agriculture and processing, mining, service, among others.
SMEs usually employ bookkeepers instead of accountants which gives room for ineffectiveness (Mutua, 2015). This is the foundational problem because bookkeepers do not have as much knowledge as the accountant and the basis for judging performance is already marred.
There is also the challenge if the issuance of standards. Lately, at the international level, the accounting has been submitted to a comprehensive process of convergence and reconfiguration, which aims to eliminate the disagreements between different accounting systems (Sava, 2013). Most accountants do not have the knowledge of it and this affects the financial reports. This is because without the knowledge of it, the financial reports would not be up to standard and the objective of the issuance of IFRS is defeated. According to International Accounting Standards Board (2009), small and medium- sized entities are characterized as not having open responsibility and by distributing broadly useful money related articulations for outside clients.
It is along these lines expected that by looking at the connection between bookkeeping administrations and the execution of SMEs, answers for the above issues might be gotten.

1.3 OBJECTIVES OF THE STUDY
The objectives of this study in a general sense are to measure the relationship between accounting services and SMEs in Nigeria. The specific objectives of this study are as follows:
1. To determine the relationship between the use of management consultancy and the return on assets of SMEs.
2. To examine the relationship between outsourcing of accounting services and the performance of SMEs.
3. Toascertainwhetherthereisarelationshipbetweentheuseofcostingandthefinancial performance of SMEs.

1.4 RESEARCH QUESTIONS
1. What is the relationship between the use of management consultancy and the return on assets of SMEs?
2. What is the relationship between outsourcing of accounting services and the performance of SMEs?
3. What is the relationship between the use of costing and the financial performance of SMEs?

1.5 RESEARCH HYPOTHESES
Hypothesis 1
H0: There is no significant relationship between the use of management consultancy and the return on assets of SMEs.
H1: There is a significant relationship between the use of management consultancy and the return on assets of SMEs.
Hypothesis 2
H0: There is no significant relationship between outsourcing of accounting services and the performance of SMEs.
H1: There is a significant relationship between outsourcing of accounting services and the performance of SMEs.
Hypothesis 3
H0: There is no significant relationship between the use of costing and the financial performance of SMEs.
H1: There is a significant relationship between the use of costing and the financial performance of SMEs.

1.6 SCOPE OFSTUDY

The totality of the scope of this research study is based on Small and Medium Enterprises in Nigeria. In the course of this research, research on financial accounting, management accounting, management consulting, auditing, taxation, profitability, liquidity, going concern and revenue generation. Putting into consideration all the small and medium scale enterprises in Lagos State, Nigeria due to proximity of the researcher.
Geographical Coverage: includes Lagos state and Ogun state due to the proximity of the researcher.
Time Frame: this project will be within a brief period of time (less than one year); that is, between September 2017 and April 2018.
The Situs: The research is carried out in Ogun State, Nigeria.

1.7 SUMMARY OFMETHODOLOGY
Questionnaire which is a primary source of date would be administered to Small and Medium Scale Enterprises (SMEs)and also some lecturers and students in Covenant University. This would then be reviewed. Correlation analysis and multiple regression analysis would be carried out in order to accurately ascertain the relationship between the dependent and independent variables. The dependent variable is the performance of Small and Medium Enterprises(SMEs) and the independent variables include the accounting services such as Financial Accounting, Management Accounting, Management Consulting, Auditing, Taxation and IFRS Conversion.

1.8 SIGNIFICANCE OFSTUDY
This study is very important to business owners, managers and also employees. This is because every business both small and medium all makes use of money to carry out their transactions. This therefore necessitates the need for the carrying out of accounting services. This study helps the stakeholders to understand the importance of accounting services and how it affects the performance and profitability of the enterprises. Stakeholders are defined as being those who can influence the activities/final results of the project, whose lives or environment are positively or negatively affected by the project, and who receive direct and indirect benefit from it (Takim, 2009).

1.9 DEFINITION OFTERMS
• Accounting: This may be defines as a process by which data relating to the economic activities of an organization are measured, recorded and communicated to interested parties for analysis and interpretation(Inanga,2000).
• Professional Accountant: The term describes a person who has expertise in the field of accounting, achieved through formal education and practical experience (International Federation of Accountants,2011).
• Small Enterprise: This is a business that employs between eleven to fifty workers (Group Independent Evaluation, 2008).
• Medium Enterprise: According to Bank of Industry, the number of employees ranges from fifty-one (51) to two hundred (200) with total assets ranging from 100 million to 500 million naira with an annual turnover of not more than500 million naira.
• Profitability: This is a measure of evaluating the overall efficiency of the business (Weston, Besley &Brigham,1996).
• Financial Analysis: This is the process of identifying the financial strengths and weaknesses of the firm by proper establishment of the relationship between items of the statement of financial position and the statement of profit or loss and other comprehensive income (Yusuf,2002).
• Stakeholders: These are the people who might be interested in the financial information about an organization. They are often seen as the users of financial information. They include; the managers of the company, shareholders of the company, potential investors, trade contracts among others (Yusuf,2002).