Change to Ukrainian interface versionChange to English interface versionChange to Russian interface versionHome pageClear last query resultsHelp page
Search for specific termsBrowse by subject categoryBrowse alphabetical list of titlesBrowse by organizationBrowse special topic issues

close this bookAccounting for the Microbusiness - A Teaching Manual (Peace Corps; 1975; 105 pages)
View the documentInformation
View the documentAcknowledgement
View the documentIntroduction
Open this folder and view contentsThe system
View the documentThe financial statements
View the documentAdditional controls
View the documentOdd entries
Open this folder and view contentsAids
 

Introduction


Here in Colombia as in most parts of the world, we find Northamerica, and Western European textbooks and technologies for all levels of business activity. Because these northern societies have developed comparatively strong economies, it is assumed that lesser developed countries can successfully follow the same path. Unfortunately, experience has shown that aside from large capital intensive industries, the application of western technologies seldom fits very closely. Consequently, it is the thesis of this manual that these technologies should not be merely transplanted but need to be studied, modified and tailored to meet nonclassical circumstances throughout the world.

An example of a western technology that has been passed intact, without even considering alteration, is the science of business accounting. One finds all the classical texts (in foreign editions) taught in the commercial high schools, universities, and adult education centers of the third--world. The debit on a particular deferred payment is the same in Pereira, Colombia, as it is in Columbus, Ohio. One must congratulate the accountants of the world for having created one of the few international languages.

Unfortunately, this language is difficult to learn well and is seldom applicable in its more complex forms. Does a household industry owner, lets say a carpenter, really have to understand deferred payments to carry an accounting system? What that carpenter needs is a very basic, simple system that he can understand and apply to his own business. Obviously, he has no need for a fine understanding of deferred payments or any other complex transaction that he will never use. The shame is that such a system has never been taught.

Sophisticated systems and transactions of the large industries are taught regardless of whether or not they are useful, and students must learn every possible commercial movement known to man. Every accounting course available assumes that its students want to be licenced accountants. There are no courses that address themselves to the limited needs of the household and small industries up to about 10 employees.

Accounting is one of many examples of a Western technology thought too sacred to be questioned, altered or modified to meet local needs. Our carpenter friend need spend only a few minutes in an accounting class to realize that what he hears has no relation to his needs. Consequently, the largest industries have accurate accounting while smaller ones have little or none.

What has to be developed then is a system of accounting and a method of teaching that are applicable to the situation. We must base accounting upon the particular needs of the small business and the capabilities of its owner. Lets develop something that the owner, his secretary, his wife or one of the children can manage and apply. A basic understanding of our potential students, their needs and capabilities, will guide us to design systems that the student himself can apply without the necessity of taking abstract accounting courses or hiring an expensive accountant. Our goal should be to give the owners and managers of small industries practical systems that they can proudly use to gain an understanding of their own companies and, consequently, manage them better.

Who then is this person? Is he always the same? Can we easily characterize him? Of course, every small business owner is distinct but we can make a few generalizations that will help us work more successfully with him. In Colombia the following observations have been made:

Abstract Thinking

The great majority of the businessmen who hire between one and ten employees have only a few years of education.... two, three, or maybe four years. Consequently they can read, write, add, substract, and construct their product.

What does this imply? Well, although they have had little education, this does not mean their intelligence is limited. They have not been taught systematic approaches more abstract than those of addition and substraction and as a consequence have not become very sophisticated thinkers. However, their production processes demonstrate that they can learn logical work systems. What we must attempt to do is develop business systems that are as mechanical as the construction of their product.

To do this we must avoid using abstract concepts whenever possible. We must concentrate on teaching a few basic ideas and their practical applications. We must construct mechanical systems that will enable those, who have the desire to learn but not the basic education, to understand ample systems.

Learning Atmosphere

Since the majority have no more than three or four years of formal education, we must realize that they are not accustomed to classes or traditional teaching methods. It must be kept in mind that:

a) With little experience in group learning, they are sometimes timid, uncomfortable and possibly auspicious. Their attention span may be short ant the majority are owner-laborers who cannot spend long periods away from the shop. In this difficult teaching atmosphere it is suggested that classes be kept a mail in number and short in duration. Two hours should be the maximum. The teaching should also be as personal and creative as possible to hold their attention which will be lost if the lesson plan is not practical ant dynamic.

b) Due to their short formal education, they tend to read for enjoyment and not to learn. Because of this, written materials should be kept to a minimum and homework exercises avoided unless they pertain directly to their particular businesses. Pictures, drawings and diagrams are preferable to detailed written handouts that they will rarely, if ever, read.

c) Without formal education they have had to learn by trial and error and tend to appreciate something only when it is revealed before their eyes. As said earlier, these are "practical" people who want to see how to apply an idea and get immediate results. When an idea is complex and fairly subtle, its chances of successfully being taught are slim because this student demands to immediately know the application of the concept. Because of this, teachers must captivate the student inductively by mixing as much practice with theory as possible and attempt to teach him by the familiar "trial and error" method.

Pride

Finally, it must always be kept in mind that the owner of the small business is psychologically very different than an employee. He has faith in himself, wants responsibility, and desires to improve his social-economic status.

Unfortunately this difference is seldom taken into account which greatly affects the success of small business assistance projects. We find that a problem lies not in the student but in the heart of the teaching: the attitude of the instructor.

The majority of business counselors and instructors that we know always assume the role of a "patron" in front of small business owners. If the Spanish word "patron" is foreign to you, the book I'm Ok, You're Ok demonstrates the point quite well. Instead of having an "adult: adult" relationship where both parties are considered equals, the roles of "adult: child" are assumed. Within the Latin culture this paternalistic attitude is quite natural to both parties, but it defeats the whole point of business assistance.

Our goal is to capacitate this person, to give him confidence in himself, and teach him that he can manage his business and use simple business systems without the help a "patron", We want to help liberate him from his feelings of inferiority, not reemphasize them. For this reason, if we give him orders and advice instead of planting ideas and seeds of ideas, we are never going to help him because we have never given him the opportunity to think and gain the confidence that is so necessary in his development.

What have we said then about the small business owner? Well, we have said that he is different We must consider this difference in his level of abstract thinking, learning experience, and particular pride. To be helped, he needs a special treatment which should consist of the following:

A. Mechanical Systems that avoid using abstract concepts.
B. Instruction by trial and error that is both personal and creative
C. Instructors that understand and respect this class of owner.

to previous section to next section

[Ukrainian]  [English]  [Russian]