Download This PaperThe Role of Financial Inclusion in the Implementation of Financial Reporting Standards for SMEs (Small Medium Enterprise) in Indonesia in Facing the ASEAN Economic Community in 2015
2nd International Conference on Business, International Relations, and Diplomacy (ICOBIRD) 2013 Binus University
5 Pages Posted: 17 Nov 2014
Date Written: November 15, 2014
Abstract
Financial reporting standards for SME in Indonesia become part of competitiveness to face the ASEAN Economic Community 2015. The open door of the competitiveness between countries in ASEAN will give opportunities as well as threats to entrepreneurs of SME in Indonesia. The wider the market will open and also means more competitors from other ASEAN countries. It means improvement of the quality of the product both goods and services need to be observed. One way to improve the competitiveness of entrepreneurs of SME is to increase working capital. This can be achieved by doing banking cooperation through loans for SME. Loan from banking always was based on financial report analysis. And it should follow financial reporting standard. This thing is become an obstacle for SME in Indonesia. In this paper, will be discussed the role of standardization financial reporting to SME and its impact for credit provision businesses. Financial Inclusion program for entrepreneurs of SME is needed, to deepen SME’ entrepreneurs knowledge about Financial Reporting Standard and to broaden their sight of business and opportunities. So they can report the financial condition in standard financial statement. Ultimately the financial statements can be used as a basis for the credit analysis of banking. At the end, it could enlarge the working capital for SME entrepreneurs. Economic developments in the real sector especially from SME sector, expected to be one of the competitiveness economic sector and became one of the pillars of the domestic economy in the face of ASEAN Economic Community 2015.
Keywords: ASEAN Economic Community 2015, Small Medium Enterprises, Financial Reporting Standard, Financial Inclusion Program
Suggested Citation: Suggested Citation