Factors Influencing the Compliance of Small and Medium Size Enterprises in the Banyumas Region of Indonesia Following SMEs Financial Accounting Standards

Abstract

This study aims to determine the effect of financial literacy, information technology, education level, firm age, owner's motivation, and firm size on the adoption of SMEs financial accounting standards (SMEs FAS) at the SMEs in the Banyumas region of Indonesia. By using a purposive sampling approach, from around 1,000 SMEs as the population, 130 were selected as a sample and the data was gathered by the distribution of questionnaires. Of 300 questionnaires during May-September 2024, 130 were returned. Then, multiple linear regression analysis was used to analyze the data. The results show that the information technology, education level, motivation, business age, and business size influence positively on the implementation of SMEs FAS, while financial literacy has no effect. With its limitations such as relatively few numbers of samples, this study contributes to developing knowledge in the field of accounting for SMEs, particularly in emerging countries such as Indonesia.