FACILITATION OF FINANCIAL STATEMENT UTILIZATION AS A FOUNDATION FOR BUSINESS DECISION-MAKING IN MICRO, SMALL, AND MEDIUM ENTERPRISES (MSMES)

Abstract

Micro, Small, and Medium Enterprises (MSMEs) play a crucial role in supporting the rural economy, particularly in creating jobs and increasing income. However, most MSMEs still face various challenges in managing their finances, such as low financial literacy, lack of systematic transaction recording, and the suboptimal use of financial reports as a basis for business decision-making. This situation is also found among MSMEs in Sadeng Village, Bogor Regency, where most businesses are still managed simply and have not implemented a sound financial management system. These problems impact business owners' limited ability to evaluate their businesses, determine business strategies, and access formal financing sources.This Community Service (PkM) activity aims to improve the understanding and skills of MSMEs in preparing and utilizing simple financial reports as a basis for business decision-making. The activity is implemented through a participatory and applied approach, including initial observation, outreach, training, hands-on practice, and mentoring in preparing simple financial reports. The materials provided include financial literacy, separating personal and business finances, recording business transactions, preparing simple profit and loss statements, and managing business cash flow.The results of the activity demonstrated an increase in the understanding and skills of MSMEs in managing business finances. Participants began to understand the importance of regular financial record-keeping and were able to prepare simple financial reports based on their business activities. Furthermore, participants also began to understand the importance of financial reports as a business evaluation tool and a basis for business decision-making. Through this mentoring activity, it is hoped that MSMEs in Sadeng Village will be able to develop their businesses more professionally, effectively, and sustainably, thereby improving the welfare of the village community in general.