AN ASSESSMENT OF THE FINANCIAL MANAGEMENT SKILLS

OF SELECTED ENTREPRENEURS

CHAPTER I
INTRODUCTION

The Problem and Its Background

In every business organization, finance is considered as its lifeblood. Kileo
(2016) stated in his article entitled, Importance of Financial Management, finance needs
to meet the requirement of the business concern whereas every business concern must
maintain an adequate amount of finance for their smooth running of the business
concern and maintain the business carefully to achieve the goal of the business concern.
He also tackled the importance of financial management which are financial planning,
acquisition of funds, proper use of funds, financial decision, improve profitability,
increase the value of the firm, and promote savings which ensures that the firm fulfills
its mission as effectively as feasible. In addition, financial management's main
objective is to control an organization's finances in a way that ensures compliance with
legal requirements and commercial success. High-level planning and effective
execution are required for the procedure. Businesses succeed and increase profits when
they are done properly as the business goal can only be achieved with the help of
effective management of finance.
One must have a solid understanding of financial accounting and management
to operate a firm successfully and achieve corporate objectives as financial management
includes arranging, planning, and managing all corporate transactions. Every decision
that a manager makes will always have great implications for the organization. It is
extremely important to consider how your management choices may affect your
company's financial stability and profitability, cash flow, and other factors. Hence,
having the necessary financial management skills as an entrepreneur is essential.
(Woodruff, 2019)
Developing financial management skills enables entrepreneurs to advance their
careers and become more effective in their role. According to Bhasin (2020), such skills
include having the knowledge of formal accounting skills, preparing financial
statements, the capability for strategic initiatives and financial evaluation, the skill of
preparing a budget, having analytical thinking skills, problem-solving skills, and many
more. Financial management is considered the heart of all corporate activities as it holds
the power to either interrupt operations due to a lack of finances or enable them to
function smoothly with a steady flow of cash. For any entrepreneur, succeeding in the
business will be tough without adequate financial and resource management. Moreover,
having financial management skills will give an entrepreneur the ease to control and
organize investments, capital estimation, financials, and profit allocation which are all
necessary for achieving the corporate objectives and goals.
As per Strutner (2022), financial management provides data that supports
creation of a long-range vision, informs decisions on where to invest, and yields insights
on how to fund those investments, liquidity, profitability, cash runway and more. It
provides clarity to various business processes and links the daily activities to the
financial profitability and sustenance of the organization. As the world operates on
money, it is critical to be on top of one’s monetary requirements and plan for it in the
long-term while planning for it in the short-term.
As entrepreneurship surges in today’s world, financial management becomes
more crucial in business management. This study is conducted to develop approaches
that can help selected entrepreneurs modify their financial management skills.
Furthermore, this study is to assess the present financial management skills and
knowledge that the respondents already possess. From this, financial management
training skills shall be advocated. Widened knowledge of their field of work offers
innovative opportunities that the managers themselves can benefit from.

Significance of the Study

The researchers attempted to conduct this study with the goal of benefitting the
following:
Business Owners and Entrepreneurs. This research will help business owners
and entrepreneurs to be more aware of their capacity and limitations as an owner or
entrepreneur. As this study intends to evaluate business owners' and entrepreneurs'
capabilities in terms of their financial management skills, it will help them identify
which aspect of financial skills they might be lacking and where they may need to
improve. Moreover, this study will encourage owners and entrepreneurs to develop
their skills for the betterment of their business.
Future Business Owners and Potential Entrepreneurs. The findings of this
study will provide future business owners and potential entrepreneurs with knowledge

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about financial management skills which are a principal factor for the success of their
businesses. This study will prompt them to take time and analyze their financial
management skills before and during the establishment of their business for better
performance and to avoid unnecessary losses.
Students. This study will benefit the students to be more knowledgeable about
the financial aspects that are important in managing a business. To be aware of how
financial skills contribute a lot in achieving the goals of the business.
Future Researchers. The researchers can provide future researchers with the
knowledge and relevant facts that they may use as a guideline for their study. This study
may serve as a reference for their review of related literature or review of related studies
and give them a better understanding about financial management skills. Furthermore,
future researchers could refer to the given data in conducting new studies on related
topics.

Theoretical Framework
This study is supported by a theory founded by Myers and Maljuf (1985) called
the Pecking Order Theory. Pecking Order Theory, on an article published by Rehayem
(2019), is the idea that company managers decide how to finance company operations
based on a hierarchy where they first use retained earnings or also called as internal
financing, then debt financing, and then equity financing. The theory argues that firms
always prefer internal sources of financing as there is no cost associated with it while
debt and equity financing will require the company some payments especially equity
financing as it involves issuing shares which are higher than the cost of debt financing
and may indicate a negative sign of the performance of the company. Thus, this theory
signifies and implies the importance of having a degree of knowledge when it comes to
business decision making which requires financial management skills. Moreover,
financial management expertise is a valuable instrument for reducing risks in business,
which enhances the performance of the organization.

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Conceptual Framework
Figure 1. Research Paradigm of the Study

Owner’s Profile Financial Management

• Age Skills
• Gender
• Months of Business
Operations • Financial • Training Needs
• Highest Educational Management • Skills Needed
Attainment Proficiency • Financial
• Financial Technical • Accounts Aspect Needed
Qualification Receivable
• Business Management Monitoring
Training Experience • Financial Institution
• Type of sales Knowledge
• Sources of funds

The figure above shows the conceptual framework of the study. The input is the
profile of the owners according to age, gender, years of business operations, highest
educational attainment, financial technical qualification, business management training
experience, type of sales, and sources of funds which enabled the researchers to define
the demographic information of each selected entrepreneurs and helps for a better
understanding of their background. The research process involves the assessment of
financial management proficiency, accounts receivable monitoring, and knowledge
regarding financial institutions which determined the possible training and skills needed
in financial aspects of the selected owners of restaurants in Baliuag, Bulacan as an
output.

Statement of the Problem

This study aimed to identify and assess the financial management skills of selected
owners of restaurants located in Baliuag, Bulacan.
Specifically, this study sought answers to the following questions:

1. How may the respondents be described in terms of:

1.1. Age,
1.2. Gender,
1.3.Years of business operations,

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 1.4. Highest educational attainment,
1.5. Financial technical qualification,
1.6. Business management training experience,
1.7. Type of sales, and
1.8. Sources of funds?

2. How may the respondents’ financial management skills and knowledge be

described:
2.1. Financial management proficiency,
2.2. Accounts receivable monitoring, and
2.3. Financial institution knowledge?

3. Based on the study's findings, what training needs, and possible suitable training
providers are significant for developing their financial skills:
3.1. Skills needed, and
3.2. Financial aspect needed of training?

4. Is there a significant difference in the respondents’ financial management skills

and knowledge when they are grouped according to their demographic profile?

Hypothesis of the Study

This study tested if there is no significant difference in the respondents’
financial management skills and knowledge when they are grouped according to their
age, gender, years of business operations, and educational attainment.

Scope and Limitations of the Study

This study was pursued to assess the financial management skills of selected
entrepreneurs in the of Baliuag, Bulacan. The target respondents are limited to business
owners within the area and are focused solely on food and beverage establishments.
This study targeted to identify the respondents’ financial management procedure,
existing knowledge, and the manner of funds handling that may be evaluated to devise
new skills and training to further advance profitability and success in the. The
hypothesis of the study is tested based on the responses of the participants involving
their financial management skills and their age, gender, years of business operations

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and educational attainment. The researchers conducted purposive sampling technique
as stated that the respondents were selected according to their entrepreneurial field,
which is the food and beverage industry.

Definitions of Terms
For ease of understanding of this research, the following terms are defined
conceptually and operationally:
Account receivable monitoring – the term refers to the measurement of the
money that customers owe to a business for goods or services already provided,
analyzing a company's accounts receivable will help investors gain a better sense of a
company's overall financial stability and liquidity.
Acquisition of funds – the term refers to the capital obtained for buying another
business. Acquisition financing allows users to meet their current
acquisition aspirations by providing immediate resources that can be applied to the
transaction.
Capital estimation – the term refers to a solely dependent on the sales forecast.
This approach assumes that the higher the sales level, the greater the need for working
capital would be.
Financial institution knowledge – the term refers to the awareness of business
owners and entrepreneurs to identify which bank or financial institution is best to make
transactions with and will benefit their business.
Financial management proficiency - knowing how to set personal financial
goals, create and manage a budget, oversee investments, handle credit cards and debt
responsibly, and keep a balance sheet are all good practices for becoming a finance-
savvy leader in business.
Financial technical qualification - are specific learned abilities, such as
knowledge of software, processes, machinery, and other work knowledge that applies
to specific tasks.

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 CHAPTER II
REVIEW OF RELATED LITERATURE AND STUDIES
To enrich and broaden the researchers’ perception of the area under study, and
to successfully evaluate the study, the following related literature and studies were
reviewed.

Financial Management Proficiency

According to Thomas (2019), not having a proper knowledge on how finance is
utilized, companies will find financial management to be exceedingly difficult and will
certainly be a hindrance with achieving the company’s objectives. Without proper
management of funds and finances it is hard for any entrepreneur – large or small,
startup or established – to be successful in business. However, as the company or owner
develops their financial management skills continually over time, they will be ensured
to run their business smoothly and effectively as financial capabilities are crucial
throughout the life of the business. These skills will come in handy to help the business
cope with any challenges and changing financial circumstances as the company grows.
One of the principal factors of financial management skills is capital budgeting
planning. Nunden, Abbana, et al. (2022) conducted a study and articulated that budgets
are a compass and guiding light for businesses which indicates that management and
owners of small and medium enterprises (SMEs) must carry out suitable and precise
capital budgeting activities and methods to ensure business longevity and progression.
The study aimed to ascertain the influence of management skills and owners on current
capital budgeting planning and practice. Thence, the findings of the study specified that
owners and managers were solely responsible for decision-making. Management skills
are key determinants of the capital budgeting procedures utilized by SMEs, but owners
and managers lacked the financial skills, ability to control and lead staff as another
result of the study, consequently, an elevated risk of SMEs failing caused by poor
management skills. The study recommended that owners and managers in SMEs
improve their business knowledge and their financial ability in the capital budgeting
process to achieve a timeous, smarter, and informed decision-making.
Moreover, a business’ access to finance is significant for funds availability. A
study conducted by Magede (2021) analyzed the relationship between financial
management skills and access to finance by small, medium, and micro-enterprises. The
study investigated Gauteng’s SMME (small, medium, and micro enterprises) owner’s
and manager’s financial management skills and how their skills affect access to finance
from financial institutions. In this study, a study by Bhorat, Asmal, et al. (2018) was
mentioned and it was stated that several criteria for evaluating financial management
skills can be derived from being able to keep track records of transactions, reading the
financial statement, estimating the rate of cash conversion cycle, and calculating profits
or losses accurately. Bhorat, Asmal, et al. (2018) highlighted that these traits of
entrepreneurs support the success of SMMEs (small, medium, and micro enterprises)
however, the lack of financial management skills by entrepreneurs hinders access by
SMMEs to finance in South Africa and a lack of access to finance means failure to meet
these traits. When SMMEs are denied access to finance, it will stop the activities of
entrepreneurs considering that access to finance is crucial for SMMEs, because it
affects their survival, performance, and growth. Hence, the study of Bhorat, Asmal, et
al. (2018) signifies that lapses in financial management skills among owners of SMMEs
adversely affect access to finance. Heading back to Magede (2021), the findings of his
study determined that entrepreneurs with prominent levels of day-to-day financial
management skills have significantly higher odds of accessing finance from financial
institutions.
Thus, these studies validate how financial management proficiency is vital in
accomplishing business goals and achieving a well-managed operation of business.
Muguchia’s (2018) statement supported this claim as he affirmed that improper
financial management practices have proven to be a main cause of failures in companies
in terms of financial difficulty, mismanagements of fund and shortage of long-term
funds to meet the operating cost and capital expenditure.

Accounts Receivables Monitoring

Accounts receivable (AR), by definition, are the balance of money due to a firm
for goods or services delivered or used but not yet paid for by customers. Receivables
are listed on the balance sheet as current assets since the account balance is due from
the debtor in one year or less (Hayes, 2022). Accounts receivable are an important
aspect of a business’ fundamental analysis as it will help investors gain a better sense
of a company’s overall financial stability and liquidity. Hence, the essence of the proper
management of accounts receivable is simply because it ensures that customers pay
their invoices and prevents overdue payment or non-payment.

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 Accounts receivable management plays an integral part in financial
performance. When firms or institutions experience no or delayed payments from the
respective receivable accounts, they may have been characterized by financial
constraints, struggling to meet their immediate obligations. Owuor, Agusioma, et al.
(2021) attested this claim through their study by examining the effect of accounts
receivable management on the financial performance of chartered public universities in
Kenya. One cannot ignore the importance of current assets in raising an organization's
financial efficiency. As mentioned, accounts receivable management form part of the
current assets, which significantly influences the financial performance of any
organization, be it for-profit or not-for-profit. Additionally, an organization can have
consistent cash inflows to satisfy its obligations and when they emerge with proper
management of the accounts receivable. For institutions that are encountering financial
crises, restructuring, and adopting policies to guarantee their optimal collection with
accounts receivable are necessary. If it continues to collect receivables in a delayed
manner or worse, fails to collect, it will significantly damage the institution's financial
operations. By the end of the study, the researchers were able to produce a conclusion
that accounts receivable management do really influence financial performance of
chartered public universities in Kenya which entailed that an adequate financial
performance of these institutions can be achieved through shorter average collection
period. In contrast with institutions that have more extended average collection periods,
these institutions experience poor financial performance explained by their respective
deficits due to the inability to meet their obligations.
Furthermore, Muthoni, Kiprotich, et al. (2020) conducted a study about the
relationship between the management of accounts receivable on the financial
performance of manufacturing firms listed in NSE, Kenya. The researchers of the said
study used descriptive research design which provides information on characteristics of
a population, and they used questionnaires in gathering the data. Proceeding to the
findings of the study, it showed that credit extension policy relates positively with
financial performance of the firms and shows that good credit policies in firms and
ensuring that there is a good credit terms to its customers, lenient credit standards and
credit risk and evaluation on credit customers affects the financial performances of the
firms. Furthermore, the receivable collection period related positively to the financial
performance of the firms as another result of the study which concludes to having a
clear receivable collection period in the firms is valuable. Their study proved that an

9
improved financial performance of the firms is affected by an effective receivable
management therefore, the study recommends that firms should put in place a sound
credit policy that ensures proper debt collection procedures and put in place effective
management of accounts receivables for better performance.
Another study on the significant impact of accounts receivables management on
the firm's performance was conducted by Sah (2022). This study revealed that
receivable management is a major determinant of firm financial performance.
Descriptive cross-sectional survey design was utilized, and the questionnaire was the
only instrument for collecting the relevant data in addressing the research questions
formulated. The researcher produced the result of receivable management strongly
influencing financial performance. In addition to the findings of the study, it also
showed that receivable management has same results to business success in terms of
performance in all areas which signifies those efficient accounts receivable
management practices, when adopted by Small and Medium Enterprises (SMEs) lead
to growth.

Financial Institution Knowledge

Financial institutions as discussed by Kinsella (2023), offer a variety of services
and financial products to individuals as well as businesses. Market booms and busts
make the value of financial institutions to the whole economy clear. Lending to home
buyers and small businesses is encouraged or even mandatory by banks in several
countries. Easy access to loans increases consumer spending, which strengthens the
economy.
Financial activities are a crucial component of any economy, and consumers
and businesses rely on financial institutions for transactions and investment. As a result,
financial institutions provide services to most people. Government's view supervision
and regulation of banks and other financial institutions as essential due to their crucial
role in the economy. There are several types of financial institutions, and each offers
specific services. Commercial banks, investment banks, insurance companies, and
brokerage firms are the types of financial institutions. (Hayes, 2022)
Consumers that are financially knowledgeable are more inclined to trust banks,
insurance providers, and pension plans. Both narrow-scope trust and broad-scope trust
have the same outcome. Although all categories of trust are positively correlated,
narrow-scope trust is significantly greater than broad-scope trust for all types of

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financial organizations studied. In agreement with Van der Cruijsen et al. (2021),
people with better financial understanding are more inclined to trust financial institution
management and to have more faith in the prudential regulatory authorities. Trust in the
financial industry is positively correlated with trust in the regulatory authority. These
stand up well when three other financial literacy metrics are used, including managing
home finances, working in the financial industry, or having true financial expertise.
Van der Cruijsen et al. (2021) also found that consumers are more inclined to
trust their own banks, life insurance firm, and pension funds if they have a higher level
of confidence in the financial stability of financial institutions in general. In other
words, trust with a large scope and a tight scope are positively correlated. Persons who
have prominent levels of narrow- or broad-scope trust are more likely than people who
have low levels of trust in financial institutions to believe in the honesty and skill of
management of those organizations. Furthermore, there is a positive and substantial
relationship between generalized trust and trust in the banking regulatory authority.
Moreover, as financial institutions provide capital for businesses, roles of
financial service providers are tested during the time of pandemic and other
occurrences. Song, Yang, et al (2020), in accordance with their study, expounded how
expectancy theory can be applied to effectively explore the decisions on adjustments
made by financial service providers to finance SMEs in the face of the pandemic.
Expectancy theory provides insights into the decision-making process needed to
achieve goals in an organization and predicts actions driven by two factors: expectation
and perceived value. Under the impact of pandemic, it is expected that they will behave
differently. The increased uncertainty during this period has caused difficulty in
predicting the attitude and behaviors of FSPs. Towards the end of the study, the findings
highlighted industries that have better prospects attract FSPs for financing activities
such as SMEs in the medical industry and public service industry. They increase their
level of financing in these enterprises however, they decrease financing to SMEs in the
construction, energy, and trade industries in the face of pandemic. This study provides
comprehension that SMEs must acknowledge the strategic adjustments made by FSPs
and take the necessary measures. SMEs in different industries must be aware that some
of the behavior of FSPs may not benefit them such as how SMEs in the construction,
energy, and trade industries may confront capital shortages due to FSPs prioritizing
financing to medical industry and public service industry as aforementioned. In
addition, SMEs should enhance their information sharing with FSPs as FSPs care about

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their business development and risk control under the impact of the pandemic through
focusing on the operational data of SMEs. Overall, it is important that SMEs understand
how FSPs will finance under occurrences.

Skills Needed
If a person cannot talk sensibly about numbers, their next career move will not
be upwards. Before, being good at their job was all a person needed to rise in the ranks,
but not anymore. Nowadays, they also need financial skills to stand out from the pack.
As claimed by Botha (2019), he enjoys watching people's faces light up as they realize
the potential of their financial skills for the first time. Before asking participants to
generate a balance sheet, which details everything they own and owe, Botha first asks
them to make a household budget comprising their income and expenses. By the end of
the course, they will be able to quickly skim through a 100-page annual report from
firms listed on a stock exchange and examine the five or six most important pages to
determine whether the company is in good financial shape. Even if the trip is not always
easy, it is rewarding. Although comprehending a budget is important for any modern
manager's KPIs, understanding a balance sheet gives the learners the most valuable
financial knowledge. Most individuals start by looking at their budget, but adjustments
there typically come with some pain - either from having to work more to earn more or
having less to spend to minimize costs.
Owner-managers of SMEs must make difficult financial decisions daily to run
their companies. Therefore, a major barrier to their businesses' operation is a lack of
information, skills, attitude, and awareness to handle and manage their finances in a
resilient, open, and professional manner. As claimed by Agyapong & Attram (2019),
owner-managers' financial literacy might improve, which would boost the performance
of their businesses. Through sound decision-making, the firm can gain a competitive
advantage thanks to the quantity and quality of knowledge that is available. Process and
product improvements are likely to follow, which will improve firm performance.
Owner-managers of these companies must actively seek to increase their financial
literacy by participating in workshops, conferences, and short courses. Collaborations
between business and academia may be used to plan such events.
Corresponding to De Alba (2021), one of the most important variables that can
make or break a small business is finance. Because of this, it is critical that every
business owner has the necessary financial abilities to keep their enterprise afloat. It is

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crucial to stay on top of the company's expected income and expenses because both
have a direct bearing on the company's cash flow, profit, and consequently, its entire
financial health. Effective budgeting can also help identify the areas where spending
needs to be cut or revenue needs to be increased to increase profitability. A personal
record and accurate, current financial data about the company can be provided thanks
to bookkeeping. It would also be impossible to manage tax audits, find high-growth
possibilities, or plan the company's future without effective bookkeeping.
The balance sheet, income statement, and cash flow statement are the three most
important financial statements that an entrepreneur must be familiar with. Bills from
customers and clients boost a small business's bottom line, yet many invoices are paid
after due dates. Therefore, every business owner's top goal should be to put in place a
fail-proof invoice approach. Platforms for invoicing allow business owners to track
overdue payments, request and receive payments, and even automatically send payment
reminders. However, as a business owner, one must make sure that your company is
making wise investments that will pay off in the long term. De Alba (2021) also stated
that an entrepreneur should carefully consider borrowing while investing the income of
the company. Finding the appropriate finance for a company endeavor is one of the last
financial skills a small business owner must acquire. For companies of all sizes, there
are many financial options accessible, but the secret to success is knowing how to
borrow intelligently. Small company owners should avoid taking on excessive debt, so
they should select financing that is flexible and meets their needs.

Financial Aspect Needed of Training

For any small firm, managing the finances is a crucial management task. For
startups and established enterprises, short-term financial management is particularly
important. In South Africa, small business owners frequently must carry out this task
on their own, but many lack the knowledge and techniques needed to do so efficiently.
When it comes to managing a business's money, financial self-efficacy serves as a
significant motivator. Focused training is crucial for acquiring financial management
skills, but little study has been done to ascertain whether this kind of training boosts
financial management abilities and financial self-efficacy. As per Kirsten (2018),
business owners are more likely to use the training's information for making financial
decisions and to be motivated to apply the financial management techniques provided
in the training course in their companies since they have also increased their financial

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self-efficacy. There may be a higher chance of the participants' firms surviving and
expanding because of their improved short-term financial management.
Financial planning has several advantages, yet these advantages vary depending
on whether an individual or business is making plans. Having funds in the bank that
can help during demanding times is advantageous to both individuals and businesses.
As reported by Walters (2019), the benefits of financial planning are vastly different
for individuals than they are for businesses because of how they spend their savings.
Companies can save money by creating a financial strategy with the assistance of a
financial adviser. When a business hires a financial consultant, they often hire a
versatile specialist capable of much more than just creating monthly budgets. The
unfortunate truth is that being a business owner does not always entail being skilled at
handling finances. One benefit of engaging a financial planner is that it frees
entrepreneurs from time-consuming financial tasks they would rather avoid, allowing
them to return to what they do best.
In accordance with Rachapaettayakom et al. (2020), technology and knowledge
management tools are the fundamental elements giving businesses a competitive edge.
The two most critical factors in motivating such entrepreneurs to seek out efficient
knowledge acquisition methods to learn from others are relevant knowledge on how to
obtain financing and precisely estimate expenses. To enable these entrepreneurs to
acquire sufficient cash during the business start-up phase and develop it afterwards,
pertinent knowledge about how to raise capital is crucial. To assist these entrepreneurs
in understanding the cost of raw materials, labor, and overheads, knowledge on how to
effectively calculate expenses is required. Due to a lack of care for cost calculation, the
entrepreneurs may have a good sales volume but are not profitable, creating financial
issues. Additionally, since they are often in charge of all duties linked to a business'
existence, prior knowledge encourages small business owners to learn more about
finances. In addition, six areas of financial expertise relevant to restaurant owners are
identified: finance, record-keeping and accounting, cash management, cost calculation,
business planning, and a feasibility study.

Synthesis
Concisely, companies will find financial management to be extremely
challenging and will undoubtedly hinder them from accomplishing their goals if they
do not have the right understanding of how finance is utilized. It is difficult for any

14
entrepreneur, big or small, startup or established, to be successful in business without
appropriate management of funds and finances. There is a lot of financial knowledge
that an entrepreneur must possess and one of them is knowing how to properly monitor
the accounts receivable. Accounts receivable management is a key factor in
determining the financial performance of a corporation. It is proven that when Small
and Medium Enterprises (SMEs) adopt effective accounts receivable management
procedures, the company will absolutely generate growth and firms will struggle if they
constantly encounter no or delayed payments from the respective receivable accounts.
In addition, consumers and businesses rely on financial institutions for
transactions and investment especially when they need more capital to proceed with
their projects. As financial activities are crucial components of any economy, financial
institutions exist and provide a variety of services to lend to those in need of capital,
which strengthens the economy. Consequently, SMEs need to be cognizant of the
strategic changes made by Financial Services Providers (FSPs) and take the appropriate
action to comprehend how FSPs will finance in the case of a capital shortage.
Furthermore, owner-managers of SMEs frequently face tough financial
decisions to operate and maintain their businesses. Therefore, they must proactively try
to enhance their financial literacy by attending workshops, conferences, and short
courses as a major impediment to the operation of their businesses is a lack of
knowledge, expertise, attitude, and awareness regarding how to handle and manage the
finances. A greater probability of the businesses enduring and growing is expected
when financial management is improved, and it can be acquired through focused
training.
This study intends to analyze the financial managerial skills of chosen
entrepreneurs to offer them an opportunity to determine whether their abilities are
sufficient to manage their businesses to reach their goals or if they still require such
training for further development. It will provide the entrepreneur with self-awareness
that might highlight their strengths and weaknesses.

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 CHAPTER III
METHODOLOGY
This chapter discusses the research methods that the researchers used to
facilitate this study to meet the objectives. This outlines the methods and techniques of
the study, the population and sample of the study, the research instruments, and the data
collection procedure.

Research Design
To comprehensively examine the study’s findings, the researchers utilized a
quantitative research method. This is to ascertain the significant difference in the
respondents’ financial management skills when grouped according to age, gender, years
of business operations, and educational attainment. The said research design’s core
objective is to study the occurrence of resemblances among individual responses. Thus,
the researchers were able to determine the number of people who share the same
thoughts, beliefs, and customs in doing such business. The researchers took pulse on
the respondents’ additional insight regarding the topic. Methods in acquiring data
wrought in different forms whether it be through traditional paper or short message
service (SMS) for follow-ups. This is due to the research design’s measuring process
of numerical data. This research design impels the questionnaire to hold both open and
close-ended questions. Methods in acquiring data took in different forms whether it be
through traditional paper sheet survey or short message service (SMS) for follow-ups.

Respondents of the Study

The respondents of this study were the selected entrepreneurs of Baliuag,
Bulacan, particularly those who are in the food and beverage industry. The respondents
defined their profiles, involving age, gender, years of business operations, and
educational attainment. Moreover, the researchers have chosen the participants
positively to present more profoundly through the purposive sampling technique.
Consequently, the respondents were selected based on their significance to the study.
Sample and Sampling Design
Due to time and resource constraints, this study was based on the purposive
sampling technique, it is used when identifying and selecting individuals, cases, or
events that can provide the best information to achieve the study's objectives, this
sampling method relies on the researcher's decision; the alternative use of probability
sampling is not considered. For participation in this survey research, the researchers
selected thirty (30) food and beverage entrepreneurs of Baliuag, Bulacan. The survey
was completed in person for efficiency.

Research Instrument
The survey questionnaire was used by the researchers to collect data. After
reading and studying questionnaire from related studies. The researchers developed a
survey questionnaire as the primary instrument for collecting data from respondents.

Construction of the Questionnaire

To collect the necessary data, the researchers used three-part questionnaires.
Part I inquired about the respondents’ demographics. The researchers
developed a tool profile that determined the age, gender, years of business operations,
and educational attainment.
Part II examined the respondents’ financial management skills and knowledge
in terms of their financial management proficiency, accounts receivable monitoring,
and financial institution knowledge.
Part III assessed what training needs and possible suitable training providers
are significant for developing the participants’ financial skills in terms of what skills
are needed, and what financial aspects need training.
To gather additional relevant information for Part III, an open-ended question
was provided to analyze if there is no significance between the participants’ financial
management skills and their demographic profile.

Validation of the Questionnaire

Following a review of related literature, the researchers developed a
questionnaire to identify the financial management skills of selected entrepreneurs. The
researchers completed and submitted the draft to the thesis adviser for review and

18
improvement.

The researchers adopted the questionnaire used by Phenya (2021) in his study
entitled An Assessment of the Financial Management Skills of Small Retail Business
Owners/Managers Modifications were made to evaluate the respondents’ financial
management skills and knowledge and to determine what significant training is crucial
for the growth of the respondents, as well as any possible suitable training providers.

Administration and Retrieval of the Questionnaire

The researchers requested permission to conduct research from the managers or
business owners of the chosen food and beverage establishments around Baliuag,
Bulacan. A letter requesting permission to collect data were given to each participant.
The researchers personally distributed the questionnaires to establish rapport and fully
explain the content of the questionnaire and the proper way to fill it out to the
respondents. The respondents filled out the questionnaires and answered random
questions about the study for 10-15 minutes, and the researchers collected the
questionnaires. Following that, the researchers expressed their gratitude to the
respondents.

Statistical Treatment of the Data

The researchers tabulated and tallied the results after collecting the
questionnaires from the respondents. The researchers used the following statistical
treatment to effectively interpret the data. The percentage and weighted mean.

Frequency and Percentage Distribution

A percentage frequency distribution is a data visualization that shows the
percentage of observations for each data point or grouping of data points. It is a great
way to express the relative frequency of survey responses and other data. This will be
used to determine the frequency counts and percentage distribution of the respondents'
personal related variables.
𝑓
Formula: P = 𝑁 × 100%

Where:

19
 P = percentage
f = Frequency
N = total number of respondents
100 = constant value

Average Weighted Mean

This is used to determine the respondents' evaluations of the descriptive
interpretation of the computed weighted mean.
Σ𝑤𝑖 𝑥𝑖
Formula: x = Σ𝑤𝑖

Where:
Σ = summation.
w = the weights.
x = the value.

In this research, the table below is used to determine the descriptive

interpretation of the computed weighted mean. Research instrument containing items
or questions with multiple response uses above equation of weighted mean (WM) to
determine the agreement of the respondent’s category and overall categories of
questionnaires. The answers were based on a scale with the corresponding description.

Scale Value Mean Range Verbal Interpretation

4 3.25 – 4.00 Very Good
3 2.50 - 3.24 Good
2 1.75 - 2.49 Poor
1 1.00 - 1.76 Very Poor

Four-Point Likert Scale

ANOVA
The researchers used ANOVA to determine if there is a significant difference
in the respondents’ financial management skills and knowledge when they are grouped
according to their age, gender, years of business operations, and educational attainment.
ANOVA is a statistical test called an analysis of variance and is used to compare the
means of more than two variables.

Independent Samples T-test

20
 To evaluate if there is a significant difference between the means of the
variables; the financial management skills and knowledge when grouped according to
their demographic profile, a parametric test of difference called a t-test is performed by
the researchers. It assumes that the data are regularly distributed and makes the same
assumptions about the data as other parametric tests.

Kruskal-Wallis Test
Kruskal-Wallis Test is a non-parametric approach for assessing if samples came
from the same distribution. The researchers used it to compare two or more distinct
groups with comparable or dissimilar sample sizes. It is less sensitive to outliers than
ANOVA and does not presuppose normality in the data.

Mann-Whitney U Test
The Mann Whitney U test, also known as the Mann Whitney Wilcoxon Test or
the Wilcoxon Rank Sum Test, is a popular nonparametric test to compare outcomes
between two independent groups. The researchers performed this test to determine
whether two samples are likely to derive from the same population.

Ethical Consideration
The researchers ensured that it strictly complied with the ethical standards of
scholarly papers as set forth in the American Psychological Association’s (APA)
Ethical Principles under the Publication Manual of the American Psychological
Association 6th edition (APA, 2010). First, the subject study will undergo institutional
approval from the University by obtaining approval prior to conducting the research.
Second, in compliance with informed consent to research, the researchers
informed the participants, among others, about the following: a) the purpose of the
research, the estimated duration, and procedures; b) their right to refuse to participate
or withdraw from participating even after the research has begun; c) the benefits or
incentives from participating; d) limit of confidentiality such as data coding, disposal,
sharing and archiving, and when the confidentiality must be broken; e) contact person
in case they have questions that need answers about the research or their rights as
participants.
On dispensing with informed consent for research, the researchers assured that
the results of the study should be provided or disseminated only if it will not cause

21
distress or harm on the participants and involved the following: a) the study of normal
educational practices, curricula, or classroom management methods conducted in
educational settings; b) only anonymous questionnaires, naturalistic observations, or
archival research for which disclosure of responses would not place participants at risk
of criminal or civil liability or damage their financial standing, employability, or
reputation, and confidentiality is protected; and c) the study of factors related to job or
organization effectiveness conducted in organizational settings for which there is no
risk to participants’ employability, and confidentiality is protected or d) where
otherwise permitted by law or institutional regulations.
Regarding debriefing, the researchers promptly provided respondents with
information about the nature, results, and conclusions of the research, and took
reasonable steps to correct any misconceptions that participants may have of which the
researcher was aware.
The researchers likewise guaranteed that the data to be presented will not be
fabricated. Moreover, regarding plagiarism, the researchers certified that they do not
present portions of another person’s work as their work, even if the works or data
sources are cited occasionally.

22
 CHAPTER IV
RESULTS AND DISCUSSIONS
This chapter presents all the results gathered in the study, containing collected
data that suffices the statement of the problem and survey questionnaire. This may
include tables, graphs, and other discussions interpreting the data.

Statement of the Problem 1.

Table 1. Demographic Profile of the Respondents in Terms of Age

Age f %
20-27 9 30%
28-35 13 43%
36-43 4 13%
44-51 2 7%
52-59 1 3%
60-67 1 3%
TOTAL: 30 100%

Table 1 demonstrates the age demographics of the respondents. The maximum

frequency is revealed to be 13, which is under the age range of 28-35, equivalent to
43%. It is followed by a frequency of 9 for the age group of 20-27, which garnered an
amount of 30%. The next age range is 36-43, with a frequency of 4 equal to 13%.
However, just 7% of responders are between the ages of 44 and 51, accounting for 2 of
the totals. Nonetheless, both 52-59 and 60-67 age brackets are just 3% of the total
population with a frequency of 1.
It is concluded that entrepreneurs are likely to start a restaurant business in the
ages 28-35. This only shows the said certain point of life is when an individual has a
high probability of starting being involved in business.
Analogous to the findings of a book authored by Tamaseb, A. (2021), the
average age of the founder of a firm was thirty-four years old. When they launched their
businesses, some founders were as young as eighteen, while others were as elderly as
sixty-eight. While they first started, startups were that age or older. The statistics
revealed that enterprises started by the younger generation generated a higher average
value.
 Table 2. Descriptives of the Respondents in Terms of Age

Mean SD Minimum Maximum

Age 32.9 10.4 20 65

The table above exhibits the age descriptives of the respondents. The
researchers got the mean age of 32.9 or 33 when rounded off, while the identified
standard variation is 10.4. As shown in the result, the maximum age of the respondents
is 60 years old, and the minimum age of the respondents is 20 years old, hence the
youngest age among thirty (30) respondents.

Table 3. Demographic Profile of the Respondents in Terms of Sex

Sex f %
Male 14 47%
Female 16 53%
TOTAL: 30 100%

Table 3 shows the respondents’ sex demographic characteristics. The female

sex is majority of respondents, with a frequency of 16, making 53% of the responses.
Conversely, the remaining 47% of the respondents are male with a frequency of 14. It
is concluded that most of the food and beverage entrepreneurs of Baliuag, Bulacan are
female. The result justifies that as the society evolves, more and more women are to be
expected to start a business.
A journal accomplished by Elting, L. (2021) indicated that women established
companies at five times the national average between 2007 and 2019, even before the
pandemic, and women-owned firms earned $1.6 trillion in income per year. And, since
March 2020, when the world came to a halt, women have founded more firms than
males, and are more inclined to go it alone rather than purchase a part in an existing
business. And, while women entrepreneurs endure longer climbs to profitability and
survival, particularly due to lack capital, our enterprises surpass the national average.
By the same token, women are seen by their managers — particularly their male
supervisors — to be marginally more effective than males at every hierarchical level
and in practically every functional area of the business. Women were regarded as
excelling in taking initiative, behaving with resilience, exercising self-development,
driving for outcomes, and demonstrating great integrity and honesty. In fact, they were
deemed to be more effective in 84% of the competences that we most typically test.

24
(Zenger & Folkman, 2019)

Table 4. Demographic Profile of the Respondents in Terms of Years of Business Operations

Years of Business Operations f %

0-5 26 87%
6-11 2 7%
12-17 0 0%
18-23 1 3%
24-30 1 3%
TOTAL: 30 100%

Displayed in the table above is the respondents’ demographic profile in terms

of their enterprises’ years of business operations. Most of the respondents surveyed are
in the range of 0-5 years of business operations, with the frequency of 26, equivalent
to 87%. It is followed by the 7% with the frequency of 2, which range is 6-11 years.
Next is those who are operating in the range of 50-73 months (about 6 years), hence its
frequency of 1, equivalent to 3%. Identical to the previous percentage of 3% is the years
24-30, scored a frequency of 1 as well. Lastly, none of the respondents were operating
for 12-17 years by the time the survey was conducted, hence acquiring 0 frequency and
so 0%. It is apprehended that there are more start-up restaurants in Baliuag, Bulacan
than long-running ones.
This claim is supported by Dautovic, G. (2022), that in the US, only half of
enterprises with workers survive the first five years. The proportion of enterprises that
continue to operate decreases significantly with time: four out of five survive the first
year, and seven out of ten survive the first two years. Half of them is still in business
after the fifth year, whereas just approximately 30% are still in company after a decade.
On average, roughly 25% of employer small firms survive for more than 15 years.

25
 Table 5. Demographic Profile of the Respondents in Terms of Highest Educational Attainment

Highest Educational Attainment f %

Primary 0 0%
Secondary 10 33%
Bachelor’s 19 63%
Master's 1 3%
Doctorate 0 0%
TOTAL: 30 100%

Table 5 shows the demographic profile of the respondents in terms of

educational attainment. It is shown that most of the respondents’ educational attainment
is bachelor’s degree with the frequency of 19 equivalent to 63% followed by secondary
level with a total frequency of 10 garnering a percentage of 33. While only 1 respondent
attained a master's degree equaling to 3% of the total population. However, there were
no respondents who answered primary and doctorate as their highest educational
attainment therefore, recording a frequency and a percentage of 0. As a result, most
business owners of Baliuag, Bulacan are likely bachelor’s degree holder.
As the findings of the study revealed that most of the respondents completed a
bachelor's degree and an overall result of the assessment of the respondents’ financial
management skills and knowledge as “Good”, it implies that their learnings from their
colleges greatly influence their management approach in their business. According to
Mamikon (2021), a college degree is not necessarily required in being a business owner,
however, a college degree can be a great foundation when starting a business. Even
though an individual opts to exert more effort to independently learn about financial
management, learning from experienced professionals can help you succeed more
quickly and efficiently. Moreover, time management, accountability, and perseverance
are just a few of the qualities and abilities you might develop in higher education that
can be useful afterwards.

26
 Table 6. Demographic Profile of the Respondents in Terms of Financial Technical Qualification

Financial Technical Qualification f %

Yes 12 40%
No 18 60%
TOTAL: 30 100%

Table 6 demonstrates how many respondents answer Yes or No for their

Financial Technical Qualification. For the respondents who answer Yes, the total
frequency gathered is 12 with the percentage of 40%. And for respondents who answer
No, gathered the frequency of 18, with the percentage of 60%.
Most of the respondents who answered Yes indicated that they graduated
“Bachelor of Science in Business Administration (BSBA)” course which includes
finance subjects granting them financial technical qualification. Moreover, another
respondent asserted being a “Certified Public Accountant (CPA)” and “Certified
Management Accountant (CMA)” which provides the respondent a qualification,
undoubtedly.
Kaplan (2023) revealed that financial technical qualifications are like an asset
for professionals with an indication that they are competent, valuable, and future-
oriented personnel. As professional qualifications can aid to the progression and
success of the finance industry, nevertheless, Mamikon (2021) stated that an individual
can still start operating a business even with no college education hence, the results
occurred that most of the respective respondents have no financial technical
qualifications.

Table 7. Demographic Profile of the Respondents in Terms of Business Management Training

Business Management Training f %

Yes 11 37%
No 19 63%
TOTAL: 30 100%

Table 7 shows how many respondents answer Yes for they have Business
Management Training and No for they did not take Business management Training.
The researcher gathered 11 respondents that answer Yes with the percentage of 37%
and 19 respondents that answer No with the percentage of 63%.

27
 The respondents who took business management training specified that they
underwent “seminars” and “conferences”, mostly. “Corporate training” and “business
training” were also mentioned for those who answered Yes.

Majority of the respondents did not take business management training which
could lead to possible complications as Amo (2019) asserts that managers who aren't
adequately trained affects the entire company in a lot of aspects such as ineffective staff
management and increased business expenses. This certifies the study of Agyapong &
Attram (2019) where the authors stated that actively seeking to increase the financial
literacy of managers and owners by participating in workshops, conferences, and short
courses is a must.

Table 8. Demographic Profile of the Respondents in Terms of Type of Sales

Type of Sales f %
For Cash only 24 80%
On debit Card only 0 0%
On credit Card only 0 0%
Cash & Debit Card 3 10%
Cash & Credit Card 0 0%
Cash, Debit Card, and Credit Card 3 10%
TOTAL: 30 100%

The table above illustrates what type of sales the respondents offer. It is
displayed that the most prominent type of sale that the respondents offer is For Cash
only which equaled to a total frequency of 24 garnering a percentage of 80 out of the
total population. However, there were 3 respondents who offered Cash and Debit
accumulating a percentage of 10. The remaining 3 respondents stated that they offer all
Cash, Debit Card, and Credit Card, that gained another 10% of the total population.
None of the respondents claimed that they offer debit or credit card alone, neither cash
nor credit type of sales, thus garnering a 0%.

Many of the respondents stated that they only use cash only and others known
for using debit card and credit card as De Alba (2021), stated that one of the most
important variables that can make or break a small business is finance. Because of this,
it is critical that every business owner has the necessary financial abilities to keep their
enterprise afloat. It is crucial to stay on top of the company's expected income and

28
expenses because both have a direct bearing on the company's cash flow, profit, and
consequently, its entire financial health. Effective budgeting can also help identify the
areas where spending needs to be cut or revenue needs to be increased to increase
profitability.

Some respondents using credit cards in an efficient way may gain great
outcome, De Alba (2021) also stated that an entrepreneur should carefully consider
borrowing while investing the income of the company. Finding the appropriate finance
for a company endeavor is one of the last financial skills a small business owner must
acquire.

Table 9. Demographic Profile of the Respondents in Terms of Sources of Funds

Sources of Funds f %
Family and friends only 7 23%
Own funds only 16 53%
Family and friends, Own funds 4 13%
Banks 3 10%
TOTAL: 30 100%

The table above exhibits the respondents’ demographic profile in terms of

sources of funds. It is shown that the maximum percentage identified is 53%, with a
frequency recorded at 16, the count of the respondents who sourced their own funds
only. Next is the frequency of 7, wherein 23% of the respondents stated that their funds
came from family and friends only. Followed by the 13% representing 4 respondents
whose capitals generated from family and friends, as well as their own funds. Finally,
the 10% signifying 3 respondents specifies that they were financed by banks.

Mainly of the respondents specified that they use their own funds to finance
their business instead of borrowing from the banks. Huls & Spors (2015) stated that
more and more business owners are personally financing their businesses. There are
lists of advantages of using the business owners’ own funds with their business ventures
such as ease and control. Although, risks of personal debt and bankruptcy may come
with utilization of own funds. Furthermore, pros and cons are only guidelines for
decisions, still, it is the business owners’ long-term perspective is what will take them
to success.

29
 Moreover, financing through the respondents’ family and friends is the second
top answer and a statement from Parker (2019) expressed that funding from family and
friends is a less formal mean and those family and friends who support your venture
may be able to provide you with favorable and clear repayment terms.

Statement of the Problem 2.

Table 10. The Respondents’ Skills and Knowledge in Terms of Financial Management Proficiency

2.1 Financial Management Proficiency Mean SD Verbal Interpretation

Preparation of a business plan. 3.37 0.615 Very Good
Preparation of a projected income statement/budget. 3.27 0.74 Very Good
Compilation of a cash budget. 3.57 0.568 Very Good
Compilation of financial statements. 3.53 0.629 Very Good
Analysis of financial statements by means of ratios. 3.2 0.714 Good
Conducting a break-even analysis. 3.07 0.868 Good
Management of inventory. 3.7 0.466 Very Good
Management of cash. 3.63 0.718 Very Good
Management of accounts receivable. 3.53 0.73 Very Good
Using spreadsheets on a computer for financial
3.07 0.944 Good
decision-making.
Financial Management Proficiency Mean 3.39 0.443 Very Good
Legend: "1.00 – 1.75: Very Poor","1.76 – 2.49: Poor ","2.50 –3.24: Good", and “3.25-4.00: Very Good”

Table 10 exhibits the respondents’ skills and knowledge in terms of financial

management proficiency. Ten (10) statements concerning the respondents’ proficiency
are presented in the domain. The statement “Management of inventory.” made the
highest mean of 3.7, having a standard deviation of 0.466, hence Very Good. The
statement “Management of cash.” asserts a mean of 3.63, possessing a standard
deviation of 0.718. The recorded data is interpreted as Very Good. The next highest
mean of 3.57 and deviation of 0.568 is “Compilation of cash budget.”, also interpreted
as Very Good. The statements “Compilation of financial statements.” and
“Management of account receivables.” has the same mean of 3.53, however they have
different standard deviations of 0.629 and 0.73, still at the Very Good scale. Followed
by “Preparation of a business plan.,” which bears a mean of 3.37, accompanied by its
deviation of 0.615, with a verbal interpretation of Very Good. Thereafter, “Preparation
of a projected income statement/budget.” acquired the mean of 3.27 and deviation of

30
0.74, verbally interpreted as Very Good as well. However, “Analysis of financial
statements by means of ratios.” got a mean of 3.2 and a deviation of 0.714, interpreted
as Good. “Conducting a break-even analysis.” and “Using spreadsheets on computer
for financial decision-making.” got the same mean of 3.07, thus the lowest, nonetheless
having different standard deviations of 0.868 and 0.944. Both statements are interpreted
as Good. Overall, the respondents assess their financial management proficiency with
a mean of 3.39 and standard deviation of 0.443, verbally interpreted as Very Good.

The result implied that the selected entrepreneurs’ financial management

proficiency is commendatory, despite expressing a modest level of aptitude in some
aspects. Corresponding to the result, most of the business owners are most erudite
particularly in inventory management. A skill that is necessary for enterprises,
principally in the food and beverage industry. Anyhow, the respondents also confirmed
their competence in terms of cash management and budgeting. However, the findings
also showed the entrepreneurs’ absence of expertise when it comes to spreadsheets
utilization, as well as break-even analysis conduction.
The outcome is comparable to the findings of Nunden, Abbana, et al. (2022),
that for small and medium enterprises to maintain corporate survival and advancement,
appropriate and exact capital budgeting actions and processes must be carried out.
Additionally, a study conducted by Thomas (2019) confirms the result, as it is asserted
that as an enterprise unceasingly progresses its financial management skills, it could
run its business efficiently, as financial capabilities are critical throughout the life of
the organization. These abilities will be useful in assisting the organization to deal with
any issues and changing financial conditions as it expands.

31
 Table 11. The Respondents’ Skills and Knowledge in Terms of Accounts Receivable Monitoring

2.2 Accounts Receivable Monitoring Mean SD Verbal Interpretation

Credit/Debit Settlement. 3.5 0.548 Very Good
Credit Terms. 3.33 0.516 Very Good
Collection policy. 3.33 0.816 Very Good
Monitoring of updated accounts. 3.33 0.516 Very Good
Collecting outstanding debt. 3.5 0.548 Very Good
Accounts Receivable Monitoring Mean 3.4 2.53 Very Good
Legend: "1.00 – 1.75: Very Poor","1.76 – 2.49: Poor ","2.50 –3.24: Good", and “3.25-4.00: Very Good”

Table 11 demonstrates the skills and knowledge of the respondents in terms of

accounts receivable monitoring. In this domain, five (5) statements are listed. Both
statements “Credit/Debit Settlement” and “Collecting outstanding debt” are recorded
as the highest mean which accumulates to 3.5 with a standard deviation of 0.548 and a
verbal interpretation of Very Good. The following statements “Credit Terms,”
“Collection policy,” and “Monitoring of updated accounts” have an equal mean of
3.33 however, “Collection policy” has a different amount of standard deviation. Both
“Credit Terms” and “Monitoring of updated accounts” obtained a standard deviation
of 0.516 which asserts to a verbal interpretation of Very Good. While “Collection
policy” amasses to a total standard deviation of 0.816, illustrating a verbal
interpretation of Very Good. All statements garnered a verbal interpretation of Very
Good hence, the overall mean of accounts receivable monitoring is verbally interpreted
as Very Good with a mean of 3.4 and a standard deviation of 2.53.

Consequently, the table enunciates how the respondents who accept credit or
debit cards aside from cash as a form of payment, can tremendously monitor their
accounts receivable considering that all statements were verbally interpreted as “Very
Good”. Based on the study that Owuor, Agusioma, et al. created in 2021, proper
collection of accounts receivable can lead the organization to have consistent cash
inflows to satisfy its obligations and if delayed or failure of collection, it can
significantly damage the institution's financial operations. As the results revealed that
the respondents assessed their knowledge and skills in this aspect to be excellent, it
signifies that they are not having trouble with managing their accounts receivable and
are on the right track. With both statements “Credit/Debit Settlement” and “Collecting
outstanding debt” as the highest occurring mean, the result is a good implication of a

32
proper management of accounts receivable and is supported by the findings of the study
made by Owuor, Agusioma, et al. (2021).

Table 12. The Respondents’ Skills and Knowledge in Terms of Financial Institution Knowledge

2.3 Financial Institution Knowledge Mean SD Verbal Interpretation

Rural Bank 2.93 1.015 Good
Commercial Bank 2.8 1.157 Good
Thrift Bank 2.33 1.061 Poor
Cooperative Bank 2.53 1.167 Good
Islamic Bank 2.2 0.997 Poor
Universal Bank 2.43 1.194 Poor
Financial Institution Knowledge Mean 2.54 0.934 Good
Legend: "1.00 – 1.75: Very Poor","1.76 – 2.49: Poor ","2.50 –3.24: Good", and “3.25-4.00: Very Good”

Table 12 shows the respondents’ Skills and Knowledge in Terms of Financial

Institution Knowledge. There are six (6) statements listed. “Rural Bank” has the highest
mean which accumulates to 2.93 with a standard deviation of 1.015 and a verbal
interpretation of Good. On the next statement “Commercial Bank” got 2.80 of mean
and a standard deviation of 1.157 with the verbal interpretation of Good. “Cooperative
Bank” comes with the mean of 2.53, alongside a verbal interpretation of Good.
“Universal Bank” comes with the mean of 2.43 and standard deviation of 1.194 with a
verbal interpretation of Poor. In “Thrift Bank,” the mean is 2.33 with a standard
deviation of 1.061 and verbal interpretation of Poor. “Islamic Bank” comes with a
mean of 2.20 and standard deviation of 0.997 with a verbal interpretation of Poor.
Therefore, financial institution knowledge or the overall mean comes with 2.54, a
standard deviation of 0.934, and verbal interpretation of Good.

The respondents’ skills and knowledge about financial institutions can be

expressed as moderate based on the results in the table above. Most of our respondents
said that they are aware of the advantages of "Rural Bank" and "Commercial Bank”,
but a few respondents knew only briefly about “Universal banks,” “Thrift banks,” and
“Islamic banks.” Other respondents stated to be familiar with “Cooperative banks”
since they were established primarily to offer a wide variety of financial services to
cooperatives and their members.

33
 Financial institution knowledge is as important as having adequate skill with
financial management and accounts receivables monitoring. According to Van der
Cruijsen et al. (2021), people with better financial understanding are more inclined to
trust financial institution management and to have more faith in the prudential
regulatory authorities, indicating that entrepreneurs and business owners must also
dedicate time and effort to understanding financial institution. Song, Yang, et al (2020)
stated in their study that it is important that SMEs understand how FSPs will finance
under occurrences as businesses may request financial assistance from banks.
Nevertheless, the overall financial institution knowledge of the respondents is still
verbally interpreted as “Good” despite recording a below average mean in some
domains.

Table 13. The Overall Assessment of the Respondents’ Skills and Knowledge in Financial
Management

The Respondents’ Skills and Knowledge in

Mean SD Verbal Interpretation
Terms of:
Financial Management Proficiency 3.39 0.443 Very Good
Accounts Receivable Monitoring 3.4 0.506 Very Good
Financial Institution Knowledge 2.54 0.934 Good
Overall Mean 3.11 0.627 Good
Legend: "1.00 – 1.75: Very Poor","1.76 – 2.49: Poor ","2.50 –3.24: Good", and “3.25-4.00: Very Good”

Table 13 displays an overall assessment of the respondents’ skills and

knowledge in financial Management. Three (3) statements are listed under this domain.
The highest mean recorded equals to 3.4 with a standard deviation of 0.506 is the aspect
of “Accounts Receivable Monitoring” and is verbally interpreted as Very Good.
“Financial Management Proficiency” possessed a total mean of 3.39 thus, subsequent
to the highest domain. It gained a total standard deviation of 0.443 with a verbal
interpretation of Very Good. Furthermore, the last domain is “Financial Institution
Knowledge” and the only aspect with a verbal interpretation as Good, accumulated to
a mean of 2.54 while its standard deviation occurred to 0.934. Overall, the computed
mean for the three (3) domains on the above table is 3.11 and gathered a standard
deviation of 0.627. It asserts a verbal interpretation of Good which indicates that the
respondents’ skills and knowledge in financial management is decent.

34
 To summarize, the respondents’ skills and knowledge in terms of financial
management proficiency is deemed sufficient in accord with managing a business. In
terms of accounts receivable, respondents are knowledgeable enough to keep track of
their credit and debit accounts which signifies that they have good credit terms with
their customers. As for the financial institution aspect, though the only domain which
is verbally interpreted as “Good”, still indicates that the respondents have an average
knowledge about financial institution. These are all supported by the researchers’
review of related literature and studies.

Statement of the Problem 3.

Table 14. Necessity of Financial Management Training to the Respondents

In need of Financial Management Training f %

Yes 16 53%
No 14 47%
TOTAL: 30 100%

Table 14 shows whether financial management training is needed by the

respondents or not according to them. Most of the respondents stated that they need
financial management training thus, answering Yes to the question and amounted to a
total frequency of 16 garnering a total 53% of the total population. On the other hand,
respondents that stated they did not need financial management training occurred to a
total frequency of 14 possessing 47% of the population. It is revealed that most of the
entrepreneurs attested that they require further understanding regarding financial
management, hence a training.

To support this claim, a study by Agyapong & Attram (2019), supposed that
owners and managers must actively go improve their financial literacy by attending
workshops, conferences, and short courses. Such events might be planned through
collaborations between businesses and universities. Because of the amount and quality
of available knowledge, entrepreneurs can obtain a competitive advantage. Process and
product enhancements are expected to arise, amending enterprise performance in
return.

35
 Financial Aspect Needed of Training According to the Respondents

This section was designed to gauge what respondents believed to be the most
crucial financial management aspect that financial management training should
emphasize. Most of the respondents stated that the most important aspect of financial
management is “cash management” or “cash flow management”, specifying that an
effective cash flow helps a business monitor and plan to take advantage of growth
opportunities. Additionally, some respondents indicate that the most crucial aspect of
financial management is “budgeting”. Another aspect that was mentioned was the
“management of accounts receivable and accounts payable”. “Monitoring of sales and
expenses” was also raised as well as “the latest technique in today’s technology”, which
includes the utilization of spreadsheets on computers for much easier and faster
calculations, which aids in financial decision-making. Lastly, a respondent stated that
“strategies for creating new projects or investment and ways to generate more income”
must be incorporated in financial management training.

The survey questionnaire enabled the researchers to identify not only the level
of financial management skills and knowledge of the selected entrepreneurs, but also
the financial aspects that the lack expertise and require training. Although the
respondents have mentioned in the previous domains of the survey questionnaire that
they excel in cash management, some of them still consider further knowledge
advancement in the field. Paralleled to the dissertation completed by Kirsten (2018),
business owners that have raised their financial self-efficacy are more likely to utilize
the training's material to make financial decisions and to be motivated to adopt the
financial management practices offered in the training course in their enterprises.
Because of their superior short-term financial management, enterprises may have a
better chance of surviving and expanding.

Statement of the Problem 4.

Table 15. Significant Difference of The Respondents’ Financial Management Skills and Knowledge
When They Are Grouped According to Age

p-value (a=0.05) Verbal Interpretation

Age 0.248 Not Statistically Significant

36
 The table above displays the significant difference of the respondents’ skills and
knowledge in financial management when grouped according to their age. The statistics
do not demonstrate the equality of the variance or its normalcy therefore, the
researchers executed the Kruskal-Wallis as statistical treatment test for the variable age.
The calculated p-value scored at 0.248, higher than 0.05 (>0.05) which signifies null
hypothesis retention that states “There is no significant difference in the respondents’
financial management skills and knowledge when they are grouped according to age”.
In conclusion, the respondents’ respective Age are Not Statistically Significant to their
financial management skills and knowledge.

Table 16. Significant Difference of The Respondents’ Financial Management Skills and Knowledge
When They Are Grouped According to Sex

p-value (a=0.05) Verbal Interpretation

Sex 0.101 Not Statistically Significant

Table 16 shows the significant difference between the financial management

skills and knowledge and sex of the respondents. As the statistics do not establish the
equality of the variance or its normalcy, the researchers performed the Mann-Whitney
U as a statistical treatment test for the variable sex. 0.101 is the formed p-value, higher
than 0.05 (>0.05) which indicates robust evidence for null hypothesis stating that
“There is no significant difference in the respondents’ financial management skills and
knowledge when they are grouped according to sex”. Consequently, the respondents’
financial management skills and knowledge are Not Statistically Significant to their
Sex.

37
 Table 17. Significant Difference of The Respondents’ Financial Management Skills and Knowledge
When They Are Grouped According to Years of Business Operations

p-value (a=0.05) Verbal Interpretation

Years of Business Operations 0.606 Not Statistically Significant

Presented on Table 17 is the significant difference of the respondents’ skills and

knowledge in financial management when grouped according to their businesses’
duration of operations (in years). The statistics provided an equality of the variance or
its normalcy, hence, conducting an ANOVA (Analysis of the Variable) as statistical
treatment for the variable months of business operation. The computed p-value attained
0.606, figures that are distinctly higher than 0.05 (>0.05), retaining the null hypothesis
stating that “There is no significant difference in the respondents’ financial
management skills and knowledge when they are grouped according to their years of
business operations”. Concluding that the respondents’ months of business operations
are Not Statistically Significant to their financial management skills and knowledge.

Table 18. Significant Difference of The Respondents’ Financial Management Skills and Knowledge
When They Are Grouped According to Highest Educational Attainment

p-value (a=0.05) Verbal Interpretation

Highest Educational Attainment 0.036 Statistically Significant

Table 18 exhibits the significant difference between the financial management

skills and knowledge and sex of the respondents. As the statistics displayed the equality
of the variance or its normalcy, the researchers performed ANOVA (Analysis of the
Variable) is a statistical treatment for the variable highest educational attainment. 0.036
is the formed p-value, lower than 0.05 (<0.05). Thus, the researchers rejected the null
hypothesis as “There is a significant difference in the respondents’ financial
management skills and knowledge when they are grouped according to their highest
educational attainment”. Correspondingly, the respondents’ financial management
skills and knowledge when grouped according to their respective highest educational
attainment is Statistically Significant.

38
 CHAPTER V
SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS
This chapter summarizes the study's findings, the conclusions reached based on
the findings, and the suggestions made in line with the conclusions.

Summary of Findings

Most of the respondents start their businesses in their 20’s and 30’s granting
them the time to manage business and gain experience. Some respondents are still
managing their businesses in their 40’s and 60’s.

Respondents from Baliuag, Bulacan that operating food and beverages more
likely of them are female which conclude that female entrepreneurs managing most of
the restaurants more than male entrepreneurs in Baliuag, Bulacan.

Therefore, most respondents start their business operation at 0-5 years, and
some are in the range of 50 to 73 months (about 6 years) of operating their businesses.
In Baliuag, Bulacan, there are more newly opened eateries than long-established ones.

Being the case, it is shown that most of the respondents’ educational attainment
is bachelor’s degree followed by second degree, as a result, bachelor’s degrees are
probably held by the majority of Baliuag, Bulacan company owners.

Most respondents had completed a Bachelor of Science in Business

Administration (BSBA) programmed that included finance studies, and a different
responder claimed to be a Certified Public Accountant (CPA) and a Certified
Management Accountant (CMA).

There were more respondents who did not take business management training
than those who took it. Respondents who underwent business management training
specified that they went mostly through seminars and conferences.

Moreover, the respondents’ type of sales was identified, and it demonstrated

that most business owners offer their products and services in exchange for cash only
and do not accept any other types of payment such as credit and debit cards. While only
six (6) respondents offer other types of payment aside from cash.

24
 Withal, the results of the researchers' analysis of the respondents' funding
decisions for their firms showcases that most business owners decide to use their own
funds to finance their enterprises while only a few chose banks to be their source of
funds.

According to the results, it determined the respondents’ excellency of erudition

when it comes to financial management. It attained a mean of 3.39, which translates to
“Very Good.” "Management of inventory" placed top out of ten (10) reference
components, with an outstanding verbal interpretation to match. Alternately, the
“Analysis of financial statements by means of ratios”, “Using spreadsheets on a
computer for financial decision-making", and “Conduction of break-even analysis” are
merely cause of the respondents’ proficiency, thus the lowest reference components of
financial management proficiency.

The researchers’ investigations also realized the distinctive accounts receivable

monitoring of the respondents who accept debit and credit payments aside from cash
payments. However, the study’s findings indicated an average level of the respondents’
financial institution knowledge. It denotes the entrepreneurs lack of information
acquisition of the different banking and financial institutions formed. “Rural Bank” is
deemed the most well-known institution by entrepreneurs, while “Universal Bank”,
“Thrift Bank”, and “Islamic Bank” were the least.

The three (3) parts of the research instrument successfully attained information
that aided the researchers to come up with results of the selected entrepreneurs. They
are financial management-proficient and knowledgeable in terms of accounts
receivable monitoring despite attaining middling cognizance when it comes to financial
institutions.

The findings of the study revealed that the respondents declared that they need
financial management training despite of the results being “Good.” It shows the
respondents’ eagerness to hone their knowledge and expertise on the matter of financial
management. In addition, it was unveiled that for most of the respondents, the most
crucial aspect of financial management that must be included in financial management
training is “Cash Management or Cash Flow Management”.

Thereafter, the researchers performed different statistical treatment tests to

discern whether to retain or reject the null hypothesis of the study. As a result, the data

24
revealed that the respondents’ financial management skills and knowledge are not
statistically significant when they are classified according to their age, sex, and their
years of business operation which is an indication that the researchers retained their null
hypothesis in these key areas of the study.

However, as for the respondents’ highest educational attainment, the findings

came out as statistically significant. Interpreting, there is a significant difference in the
respondents’ financial management skills and knowledge when they are grouped
according to their highest educational attainment and the null hypothesis is rejected in
this factor.

Conclusion

As the researchers examined the findings of the study, the researchers came out
with a conclusion that the selected business owners and entrepreneurs of Baliwag,
Bulacan in the food and beverage industry have an adequate knowledge and skills in
handling their businesses’ financials. Considerably, the assessment of the respondents’
financial management skills and knowledge in terms of their financial management
proficiency, accounts receivable monitoring, and financial institution knowledge turned
out with a verbal interpretation as “Good”. However, as most of the respondents do not
operate with the help of banks, the researchers conclude that they have low to moderate
knowledge about financial institutions. Substantially, learning more about financial
institutions is requisite to be more effective with financial management since financial
institutions offer a lot of services that can admit the organization for faster growth. The
respondents should enhance their comprehension with financial institutions most
especially with “Universal Bank”, “Thrift Bank”, and “Islamic Bank” as the
respondents' knowledge gaps are greatest in these areas.

Accordingly, as some points in the three (3) key areas of determining the
financial skills and knowledge of the respondents were regarded as low, these are the
components that the respondents need to develop and seek further improvement. These
components include “Analysis of financial statements by means of ratios”, “Using
spreadsheets on a computer for financial decision-making", and “Conduction of break-
even analysis”. Also, the respondents’ knowledge with accounts receivable monitoring

41
is outstanding which indicates that the business owners who offer both debit and credit
are well-informed that the collection of accounts receivable have a great impact on the
performance of the company which require them to maintain a good and proper
accounts receivable monitoring.

Additionally, the business owners' skills and knowledge in financial

management are significantly influenced by the degree of education they have received.
Thus, the researchers draw the conclusion that higher educational attainment is
associated with better financial management skills. Whereas age, sex, and years of
business operation do not particularly impact the financial management competency of
the business owners and entrepreneurs.

Furthermore, even though the skills and knowledge of the respondents about
financial management was evaluated as “Good”, the results of the study implied that
more than half of the respondents still desire to undergo training. This finding led the
researchers to presume how dedicated these business owners are to excel in their
industry by their persisted enthusiasm for learning. Precisely, “cash flow
management”, “budgeting”, “management of accounts receivable and accounts
payable”, “monitoring of sales and expenses”, “the latest technique in today’s
technology”, and “strategies for creating new projects or investment and ways to
generate more income” were the mentioned aspects of financial management that the
respondents deemed as important to be included in a financial management training.
With this information, the respondents concluded that the respondents’ skills and
knowledge still needed to be broadened.

These findings were the basis for the recommendations made by the researchers
to enhance the financial management skills and knowledge of business owners and
entrepreneurs and to prepare future business owners and potential entrepreneurs.

42
Recommendations
In view of the findings and conclusions of the study, the following
recommendations were drawn:

For business owners and entrepreneurs, specifically in the food and beverage
industry. This study not only serves as the evaluation of their performance but also an
eye-opener regarding scarceness in some aspect that they may improve, including
financial institution knowledge as it could further progress their enterprises’ financial
management performance.

The researchers recommend the business owners and entrepreneurs participate

more in seminars and conferences to further their knowledge about financial
management, most importantly, those seminars that coordinate with their needs like
seminars that tackles cash flow management for example. Moreover, to address the
issue of the respondents’ scarcity of knowledge about financial ratios and break-even
analysis, the respondents should register specifically for training centers such as
TESDA or Technical Education and Skills Development Authority as it offers finance
literacy courses. Also, there are free workshops that business owners and entrepreneurs
may attend to. Access with the internet is a lot easier nowadays too and other finance
skills can be learned through online.

In addition, as it is far simpler to use a spreadsheet than to manually enter

financial data, the researchers also advise spending more time learning about and
experimenting with computer usage. Using technology to manage their finances would
allow business owners to spend less time doing so. Enrolling in Microsoft courses is
handy, and the researchers would like to suggest the site called LinkedIn as they have
so much to offer that will greatly assist them in furthering their knowledge.

Exploring and acquainting oneself with the functioning of banking systems is

advised. Business owners and entrepreneurs must continuously update their knowledge
by staying abreast with financial concepts and principles including the structures and
regulations of financial institutions.

As the study concluded that the highest educational attainment of selected

entrepreneurs is highly significant to their financial management skills, the researchers
would like to recommend the utilization of the acquired knowledge and mastery in
relation to business management. It can be beneficial especially to aspects that lack

43
competence. Choosing financial subfields that correspond to the respondents’ expertise
and interests and developing specialized knowledge in areas such as financial analysis
can raise their proficiency with financial management practices.

Furthermore, having collaboration with professionals is beneficial as making

decisions together helps reduce blind spots and produce stronger financial strategies.
Consult with experts with various backgrounds and skill sets, such as accountants,
financial advisors, or consultants, to get their viewpoints and perspectives.

For those students who ought to manage their own business in the future, the
researchers suggest studying basic financial management skills beforehand and commit
and prepare themselves to learn about the industry they are going to pick.

44
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