Accounting Systems in Small and Micro Enterprises in Kenya

  • Beth Wanjeri Mwangi World Bank


For a long time in Kenya, the practices and principles of accounting have been viewed to be for use by corporate and other formally structured organizations.  This paper seeks to investigate what accounting means to small and micro traders in Kenya, by reviewing the practices and principles they use in running their businesses. Indeed, little attention has been paid to accounting systems in small and micro enterprises in Kenya and the extent of their conformity to International Financial Reporting Standards.  It also seeks to investigate the reasons why some small trade enterprises succeed while some close shop.   An analysis of how small traders in Kenya keep business records, whether these records are in written form or are held in the memory of the trader, will inform the reasons behind the success of small trading in Kenya.  It will also explain the extent to which accounting principles as outlined in the International Financial Reporting Standards are relevant to the small and micro enterprise.

 Informal interviews with small traders in Nairobi, Nakuru and Kisumu were used to gather qualitative data.  Some of the factors to be considered in the interviews were age of the trader, level of education and gender among others.

Key words: SME, accounting, informal.

Author Biography

Beth Wanjeri Mwangi, World Bank

Ms Beth Wanjeri Mwangi is a financial management specialist with an international development financial institution and is based in West Africa.  Her email address is  Her key publications include: (i) The Impact of Culture on Financial Management – Journal of Language, Technology and Entrepreneurship (2008); (ii) To Depreciate or not to Depreciate Non-Governmental Fixed Assets – Journal of Language, Technology and Entrepreneurship (2009).

Ms Mwangi is a Certified Public Accountant of Kenya and holds an MBA (Finance) from USIU.  Her main areas of academic interest relate to issues in finance and accounting in both francophone and Anglophone Africa.


Journal Identifiers

eISSN: 1998-1279