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by Phil Bartle, PhD

Training Handout

What business records training is needed for participants in micro enterprise income generation?


Any persons engaged in wealth generating activity, whether small or big, need to know and remember what is going on in the business at any time. Owners of micro enterprises must therefore write down everything that is done for future reference.

This document is complemented by Financial Recording and Reporting Topics.

What is Record Keeping?

To keep business records means to write down:

  • How much money your micro enterprise receives; and
  • How much money your micro-enterprise pays out.

Record-keeping is a way of writing down chronologically all transactions involving money coming into your enterprise and money going out of your enterprise.

A transaction is any exchange of money for value (something). Money comes in and goes out of the micro enterprise through transactions. micro enterprises mainly receive money mainly by selling goods or services. Money goes out of micro enterprise by paying for goods, raw materials, labour, utilities (eg water, electricity).

Keeping records will therefore help remember such basic things as:
  • What did I buy?
  • When did I buy it?
  • How much did I pay?
  • When and what did I sell?
  • How much did I receive?
  • Did I buy on credit or sell on credit?
  • Inventory of what is in stock (raw materials, products);
  • What monies do I receive every day (every week, every month, every year)?
  • What monies do I pay out every day (every week, every month, every year)?
  • What is the surplus and what did I do with it?
  • Am I making progress? and
  • How much money does the micro enterprise have available to spend?

When records are kept on all the above it will help the owner of the micro enterprise to know how much money s/he needs to run the micro enterprise from time to time (ie working capital and where it will come from). Neat and accurate records will also help to judge if as much profit as expected is being made. Perhaps too much money is being spent on wages or on raw materials. Perhaps someone is stealing from the micro enterprise, either cash or physical goods.

So good records will help you solve problems in your micro enterprises and be able to plan the future by seeing clearly what mistakes have happened in the past and show others how your micro enterprise is doing.

Most micro enterprises especially those owned by women do not record their business transactions because of illiteracy. They should be assisted by their children at school or literate husbands or any trusted literate person in the locality.

Types of Records to Keep:

For good record keeping you need to write down all your business transactions in an orderly manner. You need something to show that you received or paid out money. You need proof of every transaction, even for small amounts such as transport by boda-boda, envelopes, soap.

Some examples of written proof are:

  • Receipts or invoices you get when you buy goods or raw materials, pay rent, water and electricity; or
  • Copies of receipts you give to customers when they buy from you.

If there is no written proof, you must write down the details about the transaction yourself. You can use an exercise book to write down the information you need.

It is important to write down what happened:
  • Date when the transaction took place;
  • Who was involved in the transaction;
  • What the transaction was all about; and
  • How much money was involved in the transaction.

In record-keeping, receipts and any other proof of transactions are called "vouchers." Always keep your vouchers safely, in a lockable box or cupboard. They are the only proof that your records are correct.

A Simple System of Keeping Records:

Ms Somo, who runs a small retail shop in South Side argued with a customer about the number of kilograms of sugar he had bought on credit. They could not agree on the number of kilograms given on credit. Ms Somo realized that she had these problems because she did not keep records at all.

She knew that she needed business records, but she did not know which records to keep, how to keep them or how to use them. Ms Somo went to see Ms Nalongo Chow for advice. Ms Nalongo Chow owns Nalongo Grocery and she has much experience in keeping and using business records.

Ms Nalongo Chow showed Ms Somo how to record and keep vouchers for everything his business buys or sells either for cash or credit. When you start an enterprise, you spend money and later when sales start, you receive money. Every time you buy or sell something, write the details in a book called "cash book."

Cash Book:

The cash book can be made from a school exercise book.

Money In ( + ) Money Out ( - )
From which source do you receive money into your micro enterprise? On what do you spend money from your micro enterprise?
  • income from sales;
  • gifts from spouse;
  • other gifts;
  • grant from NGO;
  • loan;
  • group savings

  • raw materials;
  • wages;
  • transport;
  • medicine,
  • fees;
  • taxes;
  • food and clothing;
  • church fees;
  • paying back loan;
  • paying interest on loan

Note: all money that comes in is written on the left. All money that goes out is written on the right.

Date Money In Amount Date Money Out Amount
Day you receive money? Source of money? How much? Day you pay money? Money was spent on what? How much?

Total Total


[total money in] - [total money out] = [balance]

Use the cash in hand in (+) column as the balance to begin next page.


Training Workshop:

A Training Workshop

© Copyright 1967, 1987, 2007 Phil Bartle
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Last update: 2012.07.10

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