Evaluating the knowledge of small and medium enteprises’ managers in presenting the information on financial statements toward international integration
ISSN 2588-1299
VJAS 2020; 3(3): 689-699
Vietnam Journal
of Agricultural
Sciences
Evaluating the Knowledge of Small and
Medium Enteprises’ Managers in Presenting
the Information on Financial Statements
toward International Integration
Phi Thi Diem Hong, Phan Le Trang, Nguyen Thi Hai Binh & Tran
Nguyen Thi Yen
Faculty of Accounting and Business Management, Vietnam National University of
Agriculture, Hanoi 131000, Vietnam
Abstract
In the context of international integration, managers’ knowledge
plays an important role as a valuable organizational resource from a
strategic perspective and a foundation for competitive advantage in
business environment. The aim of this paper was to build assessment
model and attest it in the case of Vietnam’s Small Medium
Enterprises (SMEs) regarding manager’s knowledge in preparing the
information on financial statements. By analyzing current relative
standards (including international and national systems) and two
basic assessment models (ASK by Bloom et al. (1956) and BKD by
Shinseki (1999)), the study developed to identify the assessment
criteria of the manager’s knowledge as one main research objective.
The research data of 71 SMEs in the sample showed that: (i)The
relationship between managers’ background and their understanding
about information on their financial statements was a negative
linkage; (ii) The number of managers using their financial statements
to make a business decision was very low; and (iii) The most
important criteria on the financial statement in their views were
profits and revenues.
Keywords
Knowledge of managers, SMEs, financial statements, international
integration
Introduction
According to the World Bank (2013), the “skilled workforce is
central to the success of Vietnam’s economic and social transitions”
(World Bank, 2013). Unfortunately, the report of VCCI (2016) shows
that Vietnam is a country with a low ranking among ASEAN
countries in corporate governance, the lack of management capacity
and scale limitation are the major barriers to contribute to this status.
Consequently, the Vietnamese government needs to focus on financial
Received: June 11, 2020
Accepted: August 26, 2020
Correspondence to
689
Evaluating the knowledge of SMEs’ managers in presenting the information on financial statements
information transparency or improve the quality
of enterprise financial statements (World Bank,
2016). For the SMEs, the low workforce skills
are mentioned as the key obstacle to enhance
their competitiveness and linkages (World Bank,
2017). Therefore, the improvement of the
management capacity in corporate governance is
a strong current important content to develop the
SMEs in Vietnam. Moreover, the major tendency
of international economic integration occurs in
not only one but also most countries. In such a
context, international integration strategy
becomes increasingly important to SMEs (Phi
Thi Diem Hong, 2017). Currently, however, the
SMEs manager’s knowledge in using financial
information is still limited, their information
performing on financial statements (supplying
for internal and external users) has been
continuously inefficient and short of necessary
institutions to assist the improvement process
(ibid).
about the information presenting on the financial
statements will be significant to determine the
quality (reliability) of the financial statements
that they or their units have prepared. From this
perspective, this paper focuses on identifying
criteria to serve as a basis for identifying and
assessing the status of the management's
knowledge about the presentation of financial
statements, thereby proposing recommendation
to improve the quality of financial statements and
access to information from businesses.
Based on a literature overview of "knowledge"
and "evaluation" publications and the basic
international accounting standards (IFRS)
application, the research designed a research
framework to build an assessment model of the
managers’ knowledge in the presentation of
information and preparation of financial
statements. Then, the research applied this model
to attest in a sample of 71 SMEs to reveal the status
of their manager’s knowledge in financial
statements. The research findings would be
significant references for next studies in accounting
as well as human resources besides being applied
as the background of other further research to
measure the knowledge of anyone in many other
aspects.
Nguyen Viet Loc (2012) argues that
management capacity, leadership skills,
competitiveness and operating activities of
enterprises are positively affected by the
knowledge of SMEs managers. Additionally,
innovation as the core value of an
entrepreneur absolutely depends on the
managers’ knowledge (Le Thi Phuong Thao,
2016); in which, the knowledge of financial
accounting is one of the three most essential
knowledge for a chief of executive (CEO) to
improve their operating capacity (Le Quan &
Nguyen Quoc Khanh, 2012).
Materials and Methods
A review and thematic analysis were carried
out on publications with the objective of
developing a comprehensive framework. At first,
the early research of “knowledge” and
“evaluation” besides the international financial
reporting standards was reviewed and compared,
then the models of knowledge assessment were
analyzed. The findings of these steps were the
background to develop the research model of
managers’ knowledge assessment as a part of the
whole research result. The research objectives
were reached by applying this model into the
SMEs to attest the manager’s knowledge in the
presentation of information on financial
statements. Wherein, the managers who were
mentioned in this study were limited in business
entities, including directors, vice-directors, chief
executive officers, leaders of Accounting
department, or any member of the board of
In fact, most Vietnamese enterprises have
already attained the controlling information
systems, but that still does not meet the needs of
corporate governance (VCCI, 2016). Many
business owners have graduated from university
(nearly 60%), but their transformation and
communication are not effective, even
inconsistent and out of date. Notably, only a few
business owners currently have in-depth training
in economic knowledge, corporate governance,
business law, and corporate accounting (VCCI,
2016). Meanwhile, the manager's understanding
of financial accounting has a direct impact on
attracting investment capital for businesses. An
accurate assessment of the manager's knowledge
Vietnam Journal of Agricultural Sciences
690
Phi Thi Diem Hong et al. (2020)
directors. The model application for SMEs only
concentrated on collecting the preliminary result
that was not an entire survey to reflect all
academic criteria of the information on the
financial statements.
also used to find the harmonize area between
IFRSs and VASs as the accounting environment
to assess their managers’ knowledge in
presenting information on SMEs’ financial
reports. The research combines the key points of
formal financial reports (including measurement
and recognition) following both IFRS and VASs
to identify the evaluation criteria in the research
framework.
Literature review and research model of
assessing human capacity
From the literature review, it is found that
the topic of "knowledge" has been studied early
since many years BC (Hunt, 2003). Over the
time, its context has been explored in different
directions depending on the approach and
evaluation purposes of the research subject. Most
of the viewpoints agree that knowledge is a good
thing to have (in the sense of being conducive to
successful practical action) (Olsson, 2011). It
includes two components: latent (Tacit) and
exposing (Explicit) (Bloom et al., 1956; Nonaka
& Takeuchi, 1995). Many researchers mentioned
the term of manager’s knowledge in the business
leadership of managers or business executives. In
order to measure the managers’ knowledge, the
evaluating criteria also have been discussed in
different ways. Most researchers agree that the
evaluation is an assessment of achievement (or
matching) between the results (reliable output or
outcome) and the objectives (or expected
results). Following this point, this study used the
models of ASK (Attitude - Skill - Knowledge) by
Bloom (1956-1964) and BKD (Be-Know-Do) by
Shinseki (1999) which are known as the
background of assessment on leader or manager
capacity (Le Quan & Nguyen Quoc Khanh, 2012;
Tran Thi Phuong Hien, 2014).
Sample survey and Likert approach
In order to provide the evidence in practical
cases, a sample of managers in the SMEs was
selected to be included in the survey. Using
“snowballing”, the sample was designed through
the researchers’ own network to lead to another
network that was derived from the supports of the
researchers’ colleagues, students, or potential
interviewees. Through a set of open-ended
questionnaires, each interview lasted from 30 to
60 minutes, followed by specific and academic
questions. Following the assessing model as the
first steps of research, the measurement of each
assessing content was separated into different
questions. A group of them used qualitative
statistics, while others applied the Likert scale for
the purpose of data collection. The 5-point Likert
scale was used to analyze the level of
understanding or using the information by the
managers, while the qualitative statistics was
used to explore managers’ experience or
presenting skills. Depending on exact
information with the objective of assessment, the
questionnaires were set either academic or
general. A successful collection meant at least
over 80% of questions obtaining information or
not the same answer for all questions.
International Financial Reporting Standard
(IFRS) and Vietnam Accounting Standard
(VAS)
The survey questionnaire was sent out to
about 180 interviewees who worked in different
SMEs mainly from March to December in 2018.
Through both direct and indirect meetings, the
interviewees were general managers, directors,
assistant directors, or functional managers, but
there were only 75 valid responses, including 4
cases of asymmetric industries (non-business or
Nowadays, in the accounting sector or the
financial statement aspect, most people mention
IFRS as a generally accepted accounting
principle (GAAP) for international integration or
harmonization. Under this line, the IFRS – as the
current international standard has been selected
to be the formal standards to evaluate the
integrating level or the information needs
presented or displayed on business financial
statements in this research. Additionally, most
SMEs are Vietnamese enterprises, the VASs are
government administrative
organizations).
Finally, the results were found based on 71
formal responses as planned (suitable position
and all of the questions answered, etc.).
691
Evaluating the knowledge of SMEs’ managers in presenting the information on financial statements
9, VAS 21). This means financial information
Results and Discussion
(on financial reports) is useful if it is relevant and
faithfully represents what it purports to represent.
The usefulness of financial information is
enhanced if it is comparable, verifiable, timely,
and understandable (IASB, 2018). Notably,
relevant financial information is capable of
making a difference in the decisions made by
users. To keep relevant requirements, the
information must be material that the materiality
is an entity-specific aspect of relevance based on
nature or magnitude, or both, of the items to
which the information relates in the context of an
individual entity’s financial report (IASB, 2018).
The faithful information is been reflected in the
words and the numbers on enterprises’ financial
statements.
Assessment model of SMEs managers’
knowledge in presenting financial information
Financial information and identification of
assessing criteria on financial statements
Following the Conceptual Framework for
the Preparation and Presentation of Financial
Statements by the International Accounting
Standard Board (IASB), “Financial statements
are prepared and presented for external users by
many entities around the world” (IASB, 2018).
Despite available differences when setting
national requirements among different countries,
the financial statements may appear similar from
country to country. Under the current VASs and
international accounting regulations, a complete
set of financial statements normally includes the
following four components: (i) Balance sheet;
(ii) Income statement; (iii) Cash flow statement;
and (iv) Notes to the financial statements. To
achieve a fair presentation, financial statements
should be prepared and presented in compliance
with prevailing accounting standards, accounting
policies, and related regulations (Articles 7 and
Typically, the words and numbers on the
financial statements are only useful if the users
can meet their needs (effectiveness) when they
apply these reports for their purposes. The more
users apply the financial information of the
enterprise, the more effectiveness is obtained.
Consequently, the number of users reflects
Comparable
Verifiable
Measurement
(i)Relevant
Material
(ii)Faithful
Timely
Recognition
Understand
Financial Statements
General Accounting
Accepted Principles
Accounting Techniques
Numbers
Words
FINANCIAL INFORMATION
Transparrency and usefulness
Meet the demand of different
type of target of users
Low cost or expected expenses of
enterprises
Useful for users (or
enterprise)
Economic
Effectiveness
Professionalism
Figure 1. The assessment criteria of fundamental qualitative financial statement (following IFRS and VAS)
Vietnam Journal of Agricultural Sciences
692
Phi Thi Diem Hong et al. (2020)
professionalism in presentation. The cost of
financial statement preparation or application at
the lowest (or expected expenses) reflects the
economic presentation.
on the research conditions or aspects, the
evaluation process can be designed in different
methods (qualitative or quantitative), but most of
them tend to satisfy the following three purposes:
(i) Development; (ii) Accountability; and (iii)
Knowledge; in which, the evaluation for
knowledge is often aimed to generate
understanding and explanation (Federica, 2006).
Evaluating model of the SMEs managers’
knowledge in presenting the information on
financial statements
As the conclusion of the previous section, a
useful financial statement implies that their
information covers all requirements of
effectiveness, economic, and professionalism.
This strongly depends on the knowledge of
presenters who are often following their
managers, at least in an enterprise. In other
words, the managers’ knowledge in financial
statements indirectly influences financial
information presentation, at least in the
managerial sense. As the review progressed, the
study developed assessment criteria of
managers’ knowledge to identify the evaluating
model of the SMEs managers’ knowledge in
presenting financial information.
According to the Organization for Economic
Cooperation and Development (OECD), any
evaluation for knowledge needs to clarify the
purpose for which the map is being developed
before proceeding to identify three key themes as
follows: Know-What, Know-Why, Know-How,
and Know-Who (Arisha & Ragab, 2013).
Actually, up to now, numerous studies have
attempted to set up the assessing model
following these themes. Two of them are very
famous and comprehensive reviews that are ASK
by Bloom et al. (1956) and BKD by Shinseki
(1999). In light of the human resource
management proposed in an organization, Bloom
(1956) built three dimensions: Attitude, Skills
and Knowledge. His research shows the manager
Generally, according to Kucza (2001), a
manager’s knowledge also includes two
components: tacit knowledge and explicit
knowledge, wherein the tacit knowledge is the
knowledge in the manager’s mind and is difficult
to handle. It is quite different from explicit
knowledge which is formalized knowledge that
is recorded or performed as video, in a document
or speech, etc., and usually covers part of the
original tacit knowledge but is not a full
representation of it. For a person (a manager),
capacity combines
a
lot of ability in
comprehension, application, analysis, synthetic
and evaluation (Le Quan & Nguyen Quoc Khanh,
2012). For the purposes of the Army leadership
framework, Shinseki (1999) developed the
leadership focusing on character, competence,
and excellence. In his opinion, the dimensions
consist of Army values and subcategories under
attributes, skills, and actions. This means a leader
needs to know what he must BE, KNOW how to
do, and DO what must do.
knowledge is as “capacity to act” (Sveiby, 1997);
but for an organization or enterprise, knowledge
is an artery, a valuable asset, and a key to creating
sustainable competitive advantages (Arisha &
Ragab, 2013). It is also a part of the
organization's performance management and
operational assessment (Kucza, 2001). In fact,
the knowledge of managers in SMEs mentioned
is mostly related to the leadership ability of
managers.
Based on the ASK and BKD models,
research has been expended to assess the
business managers’ competence. The criteria of
presenting the information on financial
statements in SMEs following IFRSs
(Conceptual Framework for Financial Reporting)
and VAS (Vietnamese Accounting Standards)
have been reviewed. In which, the ability in
recognition and measurement economic
transactions to prepare and disclose information
on financial statements (accounting outputs) are
determined to evaluate the knowledge of the
managers. Notably, from the view of users, this
information needs to cover the consensus of all
Regarding the evaluation of managers’
knowledge, many discussions have been
published. Most authors agree on the following
three categories of the model: (i) effectiveness;
(ii) economic; and (iii) professional. Depending
693
Evaluating the knowledge of SMEs’ managers in presenting the information on financial statements
of three dimensions: economic, effectiveness (or
efficiency), and professionalism. Economic
means the preparation and presentation of
financial statements with the lowest possible cost
in the enterprise's resources. The effectiveness is
analyzed in terms of useful information
presented by users (at least effective for investors
and regulatory agencies). Professionalism shows
the contents of the criteria on the financial
statements satisfy the users' demands.
super-small busineses with charter capital under
10 VND billion, among which manufactory
enterprises (36.6%) were most popular.
In the sample (as indicated by data from
Table 2), most enterprises registered following
the form of Limited Liability and Jointed Stock
company at 40.8% and 54.9%, respectively.
There were 85.9% of responses from private
companies. They were mainly working as the
directors or CEO (in 26.8%) and functional
managers (53.5%) in their enterprises.
Current status of SMEs managers’ knowledge
in the presentation of information on financial
statements
As can be seen from Table 3, the majority of
interviewees (around 81.3%) were from the
group of 20-40 years old, only 15.5% of the
sample were from 41-50 years old while the over
50 and under 20 groups were limited at nearly
2.8% and 1.4%, respectively. The interviewees
working over 10 years accounted for only 9.9%
in the total sample, while their experience was
Sample descriptive statistics
Among 71 available responses or SMEs
(Table 1), most interviewees (49.3%) came from
small enterprises with 10 to 50 employees. In
contrast, there were 63.4% of interviewees from
Figure 2. Assessment model of manager’s knowledge in presenting information on financial statements
Table 1. Sample characteristics by Business Industries or Capital/Employees Size
Size of capital (billion VND)
Items Frequency Percent
Number of employees (person)
Field of business
Items Frequency Percent
Items
< 10
Frequency
Percent
9.9
< 10
10-20
20-50
50-100
45
15
6
63.4
21.1
8.5
7
35
18
5
Manufactory
Trade and commerce
Service
26
12
14
19
36.6
16.9
19.7
26.8
10-50
49.3
25.4
7.0
50-100
100-200
200-300
Total
5
7.0
Other (Multi-fields)
6
8.4
Total
71
100
71
100
Total
71
100
Vietnam Journal of Agricultural Sciences
694
Phi Thi Diem Hong et al. (2020)
Table 2. Sample characteristics by Interviewee’s Position, Business Formation, and Type of Capital
Interviewee’s Position
Items Frequency Percent
Business formation
Frequency Percent
Type of owner’s capital
Items
Items
Frequency Percent
General
manager
3
2
4.2
2.8
Economic Group
1
29
39
2
1.4
40.8
54.9
2.8
State Co.
Foreign Co.
Private Co.
3
6
4.2
8.5
Cooperation/ joint
stock Co.
Chairman
Directors and
CEO
19
9
26.8
12.7
Limited Co.
Partnership
61
1
85.9
1.4
Assistant
director
Multi-
national Co.
Functional
manager
38
71
53.5
100
Total
Total
71
100
Total
71
100
Table 3. Characteristics of interviewees in sample
Age
Experience
Frequency
Vocational qualification
Items
(years)
Frequency
Percent
Items (years)
Percent
Items
Frequency
Percent
<20
1
1.4
< 1
1-2
1
6
1.4
8.5
Non-training
1
3
1.4
4.2
20-30
21
29.6
Short-training
Vocational
graduation
31-40
41-50
51-65
36
11
2
50.7
15.5
2.8
Over 2-4
Over 4-5
Over 5-10
19
13
25
26.8
18.3
35.2
5
54
8
7.0
Bachelor or
equivalent
76.1
11.3
Master or
equivalent
Over 10
Total
7
9.9
Total
71
100.0
71
100.0
Total
71
100
mostly from 2 to under 10 years. About the
vocational qualification, 76.1 % of interviewees
of the sample had a Bachelor or equivalent
degree.
Olkin Measure of Sampling Adequacy) and
Bartlett were conducted to attest all of the scales
together to measure the dis-criminality and
validity of scales. SPSS version 20 was
employed to perform these tests. The result of
Cronbach Alpha analysis is summarized in
Table 5.
Description of assessing criteria
Based on the evaluation model and assessing
criteria setting in Figure 2, the real observations
about SMEs managers’ knowledge in presenting
information on their financial reports' are
suggested as follows (Table 4).
(ii) Hypothesis test and ANOVA analysis
In order to test the relationship between
specific or academic answers of the interviewees
and the factors according to firm size, position,
educational level, and vocational qualification or
working years (experience), ANOVA analysis
including one way and two ways was used to test
the null hypothesis (Ho): ‘the answers of
interviewees do not depend on position, business
size, educational level, vocational qualification,
or experience’.
Evaluation of the managers’ knowledge
(i) Exploratory factor analysis and
Cronbach alpha analysis
At first, the assessment of the scales was
carried out by Cronbach alpha testing in order to
analyze the reliability of the individual scale,
then the tests of KMO values (Kaiser-Meyer-
695
Evaluating the knowledge of SMEs’ managers in presenting the information on financial statements
Table 4. Survey contents to assess the managers’ knowledge in the presentation of information on financial statements
Main purpose of the assessment
Variables/Questionnaire or survey contents
(evaluation methods)
1. What is your educational level?
BE: Measure the background and experience or attitude of
the manager
2. Whichis the level of your vocationalqualification?
3. How long do you work at the current position?
- Method: mostly qualitative method
- Criteria:
+ For knowledge: educational level; vocational
4.Whicharea/action do you relate to financialstatements?
qualification; and fundamental knowledge in the structure
of financial reports; accounting regulation system)
5. Which accountingsystem do you apply when preparing financial
statements?
+ For experience: years of position; times of relating
financial statements.
6. Whichcomponents do yourfinancialstatements include/cover?
1. What arethe reasons for preparinga financialstatement by an
enterprise?
KNOW: Measure/evaluate the preparation or presentation
skills; the ability of understanding information; and analysis
ability
2. Howare yourfinancial statement contents or criteria onstatement
designed orsetting? (by who?)
- Method: Application of both qualitativemethod and Likert
scales
3. When are yourfinancialstatements prepared or published?
4. In your opinion, what is afaithfulfinancial report?
- Criteria:
+ For understanding: purpose of financial statement or
reasons for preparing financial statement; function of
accounting staffs, etc.,
5. What is yourmotivation to prepare theirfinancialstatement?
6. Howdo you understand about theterms presented on a financial
statement such as owner capital, inventory; receivable; and liability, etc.?
+ For preparation: motivation of preparing; when/who
prepare financial; etc.,
(*)
7. What do youthink about the roles of accounting staff in a enterprise?
+ For analysis: which content/criteria to present; faithful
financial reports; and explanation of the importance of
each criterion; etc.
8. Do you think themanagermust study accounting andfinancialsubjects?
(*) Whichis a suitablecourse/program?
DO: Measure the action of the manager in making
decision using financial information
1. Which of thefollowing criterion do you think needs to present on financial
statement: revenues, expenses; andincome beforetax, etc.? (Please
show which important level)(*)
- Method: Application of both qualitative method and
Likert scales
2. For which purpose did you applythe information presented onfinancial
statements?
- Criteria:
+ For setting up the criteria on the financial statements:
criterion needs to present; etc.,
3. Have you ever used financial informationtomake business decisions? If
yes, howoften do you use?(*)
+ For the purpose of preparing financial statements:
explain the importance of financial information to business
operation etc.
4. Howdo youthink about the financialstatements’ quality duringlast time?
(*)
Note: (*) Using Likert scales to measure the level of assessing criterion (Likert 1: 1 = Zero/No; 2 = Little; 3 = Average; 4 = Good; 5 =
Very good; Likert 2: 1 = Never; 2 = Rarely; 3 = Sometimes; 4 = Often/usually; 5 = Always; Likert 3: 1 = Empty; 2 = Very poor; 3 =
Enough; 4 = Good; 5 = Very good).
Table 5. Cronbach alpha analysis and exploratory factor analysis results
KMO and Bartlett’s Test***
Variables
Items Items Cronbach alpha**
Value
sig
Cumulative(%)
66.66
Preparing and setting financial criteria
9
16
4
9
16
4
0.878
0.981
0.949
0.946
0.827 .000
0.858 .000
0.792 .000
0.838 .000
Understanding financial information
84.71
Knowledge of financial statements’ function and purpose
Analysis quality of financial statements
85.08
4
4
78.13
Note: ** the reliability of scales for individual factor is valid with Cronbach alpha >=0.6 and its correlation must be >=0.3
*** KMO value requirements are greater than 0.5 with significance of .000 (< 0.05)
Vietnam Journal of Agricultural Sciences
696
Phi Thi Diem Hong et al. (2020)
that only 26.8% of the sample often used their
information on financial reports to make a
business decision. Under the question of “What
are the reasons for preparing financial statements
by the enterprise”, the study found that over 40%
(29/71) of the interviewees were confused
between the regulations as compulsory and the
gains of financial statement in business. A
significant number of responses agreed that their
enterprises still ran a business well without
financial statements and their motivation of
preparing financial reports was because they
were compulsory by tax law.
Findings
Negative relationship between the
interviewees’
understanding of financial information on the
financial statements
background
and
their
As aforementioned (Table 3), many
managers of the sample had a Bachelor’s degree
or its equivalent. Over 20% of them,
nevertheless, believed that the financial
statements were simply an accounting output
under legal compliance. It is rising in some cases
of strongly supporting the idea of these reports as
controlling the accountant works in their
enterprises. In their opinions, if their financial
reports passed the tax official requirements, their
accounting staff possessed good knowledge or
high qualification.
Although most interviewees believed that their
financial statements were at good quality (the
Likert’s score of 4 criteria, including timely,
relevant, faithful, andmaterial)inassessingfinancial
statement’s qualitywere popular at 4 on a scale from
1 to 5, about 10% of the interviewed managers in the
sample had never used the information from
financial statements to run their business. There
were only 8.5% who rarely and 14.1% who
sometimes applied them.
Additionally, almost all of the interviewees
considered their knowledge as “good” (Likert’s
core of 16 items in assessment of understanding
financial information were from 3.58 to 3.97 on
a scale of 1 to 5). They absolutely agreed,
however, their financial statements strictly fit
formal regulations rather than providing useful
information to users or managerial purpose. It
became more extreme because 5.6% of the
interviewees supported the statement that the
improvement of their knowledge was only
important if there was a need to prevent
accountanting fraud.
Limited Profitable and revenue data as the
most important criteria on the financial
statements in the views of SMEs managers
Among 9 items (revenues, expenses,
retained earnings, taxation fees, receivables and
payables, plant assets or long-term assets, and
others) of a variable group of preparing and
setting financial criteria on financial statements,
the Likert’s scores were the highest in profitable
and revenue items with 3.79 and 3.2,
respectively, whereas the lowest was 1.87 at
unusual or sub-information (belongs to “others”).
Paradoxically, in many cases, the business
decisions of investors came from the extra or
specific information of “others’ items because
these investors naturally wanted to collect much
information out of report formation to enrich
Limited number of managers using
information on financial statements to make a
business decision
Most managers had good background
knowledge of regulation for preparing financial
reports with many correct answers in the criterion
group of knowledge in regulations of the
financial statements. The study found that over
90% of the sample answered the question: which
components under current regulation of financial
statement correctly? Approximately 89% of the
interviewees answered their accounting system
under law exactly. Notably, more than 94% of
the responses of the survey gave the name of
accounting circulars (or regulations under the
law in the accounting sector) that their financial
their knowledge before making
a
final
investment decision. This reflects the fact that the
SMEs managers concentrated vigorously on a
short-coming rather than a long-term proposal. It
also implies that it is are still challenging for the
SMEs to improve their competitive advantage at
the current manager’s capacity (at least the
knowledge in preparing financial statements).
reports
must
follow
in
preparation.
Unfortunately, the collecting data also showed
697
Evaluating the knowledge of SMEs’ managers in presenting the information on financial statements
Conclusions
Managers’ knowledge in general and in
References
Arisha A. & Ragab M. (2013). Knowledge Management and
Measurement: a Critical Review. Journal of Knowledge
Management. 17(6): 873-901.
particular about the preparation of the
information on financial statements often relates
closely to managers’ competence. The
assessment model of SMEs manager’s
knowledge in preparing the financial statements,
as one of the research results, contributes
significantly to active identification of manager’s
knowledge as well as financial statement
qualification. Based on this model, the evaluator
would develop to assess the knowledge of
anyone in many different sectors (not only
accounting but also any other aspects).
BloomB. S.,EngelhartM. D.,FurstE.J., HillW. H. &Krathwohl
D. R. (1956). Taxonomy of Educational Objectives- The
Classification of Educational Goals. Published by David
MckayCompany Inc. 216 pages.
HuntD.P. (2003). Theconceptofknowledgeandhowtomeasure
it. Journal of Intellectual Capital. 4(1):100-113.
Federica C.-L. (2006). Evaluation: definitions, methods and
models -An ITPS framework. Working paper, No.
R2006:002, Swedish Institute For Growth Policy
Studies,
39
pages.
Retrieved
from
2018.
For other findings, the research data of 71
SMEs showed that most interviewees had limited
knowledge in preparing financial statements. It
seems more urgent that a significant number of
them still misunderstood or could not apply the
information on financial reports, especially in
their skill of preparing, into presenting or
analyzing cases. In other words, at the current
manager’s knowledge in preparing financial
statements, it was still difficult for the SMEs to
take advantage in not only international but also
national competitions. In order to improve this
status, the recommendations include: (i) the
managers should actively improve their
knowledge by themselves; (ii) the current
accounting standard system should be revised
allowing much more international system
harmonization; and (iii) the educational and
training system should focus on providing the
skills or capacity of learners rather than
knowledge in theory.
IASB (2018). Conceptual Framework for Financial Report.
Retrieved
from
December18, 2019.
KuczaT.(2001).KnowledgeManagementProcessModel.Espoo
2001. Technical Research Centre of Finland, VTT
Publications 455.101 p. + app. 3 p.
Nonaka I. & Takeuchi H. (1995). The Knowledge-Creating
Company. Oxford University Press, Oxford, New York,
1995.
Nguyen Viet Loc (2012). Vietnamese entrepreneur cultural on the
process of International Integration. Doctoral thesis. VNU
University of Economics & Business. 186 pages (in
Vietnamese).
Le Thi Phuong Thao (2016). Study on the leadership capacity of
managers of SMEs in the North Central Area in Vietnam.
Doctoral thesis. VNU University of Economics & Business.
Hue college of economics, Hue University. 165 pages (in
Vietnamese).
Le Quan & Nguyen Quoc Khanh (2012).Assessing competences
of CEOs in Vietnamese small enterprises through ASK
approach.VNU Journal of Science- Economics & Business.
28(2012): 29‐35.
Olsson E. J. (2011). The Value of Knowledge. Philosophy
Compass. 6(12): 874-883.
PhiThiDiemHong(2017).Acomprehensivestudyofaccounting
Acknowledgements
system
and
consolidated accounting in Vietnam: Focusing on the factor
analysis of consolidatedfinancial statements. Doctoral thesis.
Komazawa University, Tokyo, Japan.
This research was supported by the Faculty
of Accounting and Business Management,
Vietnam National University of Agriculture. We
thank the members of Faculty Board for their
helpful comments on a previous draft of this
paper and their suggestions on study design and
analyses. We also would like to thank the SMEs
managers who were the interviewees of this
research.
Shinseki E. K. (1999). Army Leadership: Be, Know, Do. Field
ManualNo.22-100(FM22-100). Headquarters,Department
of the Army. Washington, DC, 31 August 1999. 270 pages.
SveibyK. E. (1997): The New Organisational Wealth, Managing
and Measuring Knowledge-Based Assets, Berrett-Koehler
San Fransisco. CA: Berrett-Koehler Publishers, Inc. 236 p.
Tran Thi Phương Tran Thi Phuong Hien (2014). Leadership
competency of Vietnam CEOs ( research in Hanoi).Dotoral
Vietnam Journal of Agricultural Sciences
698
Phi Thi Diem Hong et al. (2020)
thesis.National Economics University. 167 pages (in
Vietnamese).
8176937722/Main-report on December 10, 2019.
VCCI (2016). Provincial Competitiveness Index2015-PCI
2015-Evaluate the quality of economic governance to
promote business development. Labor Publishinh
House, 2016. 106 pages (in Vietnamese).
World Bank (2016). The Reports on the Observance of
Standards and Codes (ROSC) - Accounting and
Auditing Module, Vietnam 2016, Hong Duc
Publishing House. ISBN: 978-604-89-1352-6.
World Bank (2013).Vietnam development report 2014:
Preparing the work force for a modern market
economy (Vol. 2): Main report (English). Washington
WorldBank(2017).Vietnam:EnhancingEnterpriseCompetitiveness
and SME Linkages-Lessons from international and national
experience, Trade and Competitiveness Global Practice the
WorldBankGroup,PublicDisclosureAuthorized: 1-106.
DC;
World
Bank.
Retrieved
from
699
11 trang
9940
Free
Bạn đang xem tài liệu "Evaluating the knowledge of small and medium enteprises’ managers in presenting the information on financial statements toward international integration", để tải tài liệu gốc về máy hãy click vào nút Download ở trên
File đính kèm:
- evaluating_the_knowledge_of_small_and_medium_enteprises_mana.pdf
