Abstract

The study examines record-keeping practices of selected retail shops in Douala. The study was guided by the following objectives; to examine the availability of record keeping practices used by retail shops in Douala and to identify the challenges faced by selected retail shops in Douala. The selected businesses here are businesses in the secondary and tertiary sector in Douala.

The study adopted a case study design with both qualitative and quantitative approaches. The random sampling technique was used to choose the sample businesses that will represent our target population. Primary data was collected with the use of 40 questionnaires that was answered by accountants and other department staffs of the target businesses. Frequencies and percentages were used to analyse data through SPSS and Microsoft Excel and the results were showed on tables, bar charts and pie charts.

The major findings of the study are as follows: the most widely used record keeping practice is computers, subsidiary books and accounting softwares and the most common challenges faced by this retail businesses are inadequate finance, limited sales and lack of entrepreneurial development.

It is worthy to recommend that record keeping practices to beginners who have little computer and accounting knowledge, to businesses who seek accurate, complete and simple to understand record keepings and also to businesses who seek to protect their data (recordings) from unwanted persons as these CAS have passwords to limit access to the system from unwanted persons and they also have features that protects its information from hackers and virus attacks. Small business owner-managers should also develop competencies to enhance the quality of record keeping, with specific focus on type, adequacy and updated-ness of records.

CHAPTER ONE

GENERAL INTRODUCTION

1.1 Background of the Study

Cambridge university press (2018) defines record keeping as the activity of organizing and storing all the documents, files, invoices among others relating to a company’s or organisation’s activities.  According to Oxford living dictionary (2019), record keeping is the activity or occupation of keeping records or accounts.  According to Routledge (2020), record keeping in International Organisations offers an important treatment of international organizations from a record keeping perspective, while also illustrating how record keeping can play a vital role in our efforts to improve global social conditions.

Record keeping practices in small businesses plays an important role in many developing countries (BANCY WAWIRA MUCHIRA, 2018). According to (Mwebesa et al., 2018), regionally studies indicates that in most African countries (like Nigeria, Kenya and South Africa), record keeping has been embraced as a driving factor for firms financial performance.  In respect of the fact that good record keepers require training in the field and in consideration of the fact that in Kenya, majority of small businesses fail few months after they are established (Bowen, 2017).

According to Adade, Kudo (2017), in Nigeria, majority of small enterprises do not keep proper accounting records otherwise referred to as incomplete records. Small enterprises owners have failed to recognise the importance of well-structured accounting system that would have enabled them to keep accurate financial statement. Record keeping is vital to business management (Ademola Samuel, 2017).

Cameroonian enterprises are small businesses, According to National institute of statistics (NIS) of Cameroon (2017) small businesses like retail shops which generates more than 34% of Cameroon’s Gross Domestic  Product are responsible for 70% of employment generation and over 90% of the country’s national income fabric (GDP). Although businesses use record keeping to determine their level of growth and performance globally, record keeping remains one of the factors militating against sustainable businesses in Cameroon (Charles, 2020).

Failure to record business financial transactions (book keeping) leads to collapsing of the business few month of its establishment (Germain, 2018). In essence, recordkeeping is one thing an entrepreneur cannot afford to ignore. Also, research has shown that in any business, record keeping is the first step of the accounting process, which also includes classifying, reporting and analysing the business financial data.

It involves organizing and tracking receipts, cancelled checks and other records generated by the financial transactions. Book keepers chronologically record all transactions; cash disbursement, cash receipts, sales and purchases and others in the journal and post the journal entries to a general ledger of accounts, which is essential for the preparation of monthly financial statements. This is imperative for a profitable business.

Further research has shown in the past that in business management, proper keeping of records of all business transaction is vital for the success of the business (Mc Grawth, 2019). In addition, Butler (2018) asserts that without accurate and complete records  of business transactions the business is doomed to fail at its onset.  The most effective way for retail shops to maintain their critical responsibilities is to apply basic financial and accounting standards ( Schwenk, 2017). Many retail shops have been reported to have failed to retain proper accounting records in order to create the much- needed accounting information that owner-managers and other users demand for decision –making purposes, resulting in serious issues (Manawadu, 2017). Larson (2018) also stated that certain retail shops had deficient internal accounting systems, which resulted in poor planning, spending control, low accounts receivable collection, bad financial condition, and insufficient information for decision- making.

1.2 Problem Statement

Record keeping frightens some business owners (Abdul-Raham, 2017). Keeping record of income and expenditure helps an owner of business to keep proper track of financial transaction (Abdul-Rahaman, 2017). Little is known about the importance of record keeping in retail shops, the issues retail shops experience in preparing accounting records, or the relevance of record keeping methods in retail shops.

According to previous research, record keeping is at the centre of all external interaction with retail shops, whether its obtaining financing or determining eligibility for help. That is, credit worthiness and growth potentials are all encoded in the retail shop’s accounting records.

Theoretically, proper record keeping and enterprise success, such as profitability and expansion, should have some favourable impacts. Bad accounting or lack of financial records, according to Dawuda and Azeko (2017), can lead to resource mismanagement. Many retail shops have been forced to close as a result of these factors. Financial records have a significant impact on a company’s ability to achieve its goals (Olufemi & Oladimeji, 2019). Some retail shop owners are still unaware of the importance and advantages of efficient record keeping (Abayomi, 2018).

Some retail shops in Douala Cameroon are being pushed to submit their financial records in order to acquire tax clearance certificates, which are required to bid the government contracts. Except for legal obligations, retail shops rarely consider solid record keeping; yet, poor and ineffective record keeping has contributed to the failure of certain retail shops; failure of retail shops to keep accurate records is one of the causes for their failure. According to (Rankhamise, 2019), several retail shops create their financial statements in order to get bank loans. It’s tough to tell the difference between company and personal transactions for retail shops owners due to poor record keeping.

1.3 Research Questions;

1.3.1 Main Research Question;

What are the record keeping practices of selected retail shops in Douala Cameroon?

1.3.2 Specific Questions;

1. What are the record-keeping practices used by selected retail shops in Douala?
2. Are there challenges faced by selected retail shops in Douala?

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