THE MANAGEMENT ACCOUNTING PRACTICES (MAPs) AND FINANCIAL PERFORMANCE OF SMALL & MEDIUM ENTERPRISES (SMES): THE EVIDENCES FROM THE NORTHERN CORRIDOR IMPLEMENTATION AUTHORITY (NCIA)’S REGION.

Abstract

The objectives of the study are three folds, namely, to investigate; (i) the level of MAPs employed by SMEs in
Northern Perak in NCIA region, (ii) any positive relationship between MAPs and the financial performance, and
(iii) the explanatory ability of the selected variable towards the financial performance. The present study
distributed 100 questionnaires to the small and medium sized enterprises (SMEs) in the Northern Corridor
Implementation Authority (NCIA) Malaysia. The 65 useable questionnaires were analyzed using The Statistical
Package for Social Sciences (SPSS). Findings showed that the application of the costing system and budgeting
system are significantly higher than the decision support system and strategic management accounting.
Furthermore, the medium sized firms make greater use of all MAPs as compared to small sized enterprises.
However, the research found a weak support for the positive relationship between the use of MAPs and financial
performance with the selected variables able to explain 64.9% of the dependent variable. However, the present
study was limited to the SMEs, with a limited sample size as well as inherited the survey weaknesses, Research in
this area can be enhanced by extending the bigger sample and conducting comparison among different
industries.