Determinants of the use of accounting systems in microenterprises: evidence from Chile

Tonatiuh Najera Ruiz and Pablo Collazzo

Journal of Accounting in Emerging Economies, 2021, vol. 11, issue 4, 632-650

Abstract: Purpose - The purpose of this research is to contribute to knowledge-building on microenterprises in emerging economies, by assessing the determinants that drive their use of accounting systems. Design/methodology/approach - A probabilistic model was developed to determine the likelihood that a micro-firm would adopt an accounting registry system as a function of a series of contingencies and personal characteristics of their owners/managers. Data from the Microentrepreneurship Survey (EME), from the National Institute of Statistics of Chile for 2017 was used. Findings - The findings suggest that access to external funds, the size and the use of technology strongly influence micro-firms' adoption of accounting systems. Research limitations/implications - Despite the richness and scope of the data, direct measurements of entrepreneurial orientation and environmental uncertainty, both central variables of the contingency theory, were missing. Hence, duly justified proxies were applied. It is also likely that there would be other variables that also influence the probability of using accounting tools. Practical implications - The study contributes to a better understanding of microenterprises, and the factors that determine the use of accounting systems. The results highlight that public policies aimed at fostering microenterprises should facilitate access to technology and external funds. Consistent with previous studies, the authors’ findings highlight the importance of training owner/managers on issues related to their business. Originality/value - This paper contributes to theory by arguably being the first study to confirm that contingency theory does explain the adoption of accounting systems in microenterprises in emerging countries.

Keywords: Accounting; Microenterprises; Emerging economies; Contingency theory (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jaeepp:jaee-07-2020-0173

DOI: 10.1108/JAEE-07-2020-0173

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