UPSI Digital Repository (UDRep)
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Abstract : Perpustakaan Tuanku Bainun |
The absence of financial management practices results in financial institutions facing difficulties when approving loan applications. This study aims to examine the influence of financial management practices on the business performance of Malaysian SME family businesses. A quantitative survey was conducted involving 399 family-owned SMEs in the states of Perlis, Kedah, Kelantan, and Terengganu, using a simple random sampling technique. Questionnaires with a 5-point Likert scale were distributed and collected through self-administration. Pearson correlation, multiple regression analysis, and moderation analysis were performed using SPSS v.26 and the PROCESS macro for SPSS v.3.0. The study applied the Resource-Based View (RBV) theory and Pecking Order Theory (POT). The results showed positive and significant correlations between working capital management, investment, accounting information systems, capital structure, financial reporting analysis, and business performance of Malaysian SME family businesses. Multiple regression analysis revealed that financial management practices explained 46.9% of the variance in the performance of these businesses. The findings of multiple regression analysis showed that financial reporting analysis (_ = 0.383, p = 0.000), working capital management (_ = 0.213, p = 0.000), capital structure (_ = 0.168, p = 0.000), and accounting information systems (_ = 0.129, p = 0.003) were the most influential financial management practices affecting their business performance. Furthermore, the findings demonstrated that financial attitudes moderated 71.06% of the relationship between financial management practices and business performance in Malaysian SME family businesses. In conclusion, the findings provide empirical evidence that financial management practices, coupled with a positive financial attitude, play a crucial role in enhancing business performance in Malaysian SME family businesses. As such, the implications of this study indicate that to improve access to funding from SME agencies in Malaysia, SME family businesses should collaborate with financial institutions to evaluate the implementation of financial management practices. |
References |
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