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Effect of Internal Controls on financial Performance EssayOver the past decade, Africa and other developing regions shed been in the midst of marvellous swops. Market liberalization and g everyplacenmental decentralization policies encounter inter approach with globalization and urbanization trends to dramatic every(prenominal)y transform social, political, frugal and cultural lives. In this context of rapid change, SME operations bathroom no longer re main quarter serving only to meet sustenance income for their owners. SMEs engagements move over to become a participating and integral fragmentize of the trade economy. The identification of factors that determine new game process such as survival, proceeds or profitability has been one of the most central fields of entrepreneurship re try (Sarasvathy, 2004). A multitude of research written document has foc apply on exploring various(a) vari satisfactorys and their meeting on performance (Bamford et al., 2004). However, in order to be able to analyze and model the performance of new ventures and SMEs, the complexity and dynamism they be facing as considerably as the fact that they may non be a homogenous group just now importantly protestent in regard to m any characteristics (Gartner et al., 1989) vex to be taken into account.In line with the supra, thither have been challenging debates all everyplace the world on the role played by slightened and mass medium Enterprises (SMEs) towards sparing development. Therefore, a vast literature on the maturation and performance of SMEs has been developed over the years. micro and Medium Enterprises (SMEs) have had a privileged treatment in the development literature, particularly over the last two decades. Hardly any arguments ar gift forward against SMEs, even if development policies do not necessarily favour them and economic programs, voluntarily or not, often continue to result in whopping capital investment. Arguments for SME s come from almost all corners of the development literature programs, particularly in the little developed countries (LDCs), tend to emphasise the role of SMEs, even if practical results differ from the rhetoric. (Carlos Nuno Castel-Branco. May, 2003) Therefore, SMEs seem to be an current wisdom inwardly the development debate.It is believed that exploitation in SMEs should have a positive effect on the living conditions of the populate, their income level, housing, utilities. Castel-Branco (2003), in a raceplace, revealed that this is not forever true beca wont worlds where SMEs ar performing so well(p) attracts public attention and many competitors begin to troop into the ara. This subsequently leads to over congestion with its associated problems of which accommodation is not an exception. The structure of SMEs in gold coast as perhaps one of the main engines of growth can be viewed as rural and urban enterprises. For urban enterprises, they can either be planned or unplanned. The planned-urban enterprises atomic go 18 characterized by paid engrossees with registered offices whereas unplanned-urban enterprises are mostly confined to the home, open space, temporal wooden structures, and employment in that is family or apprentices oriented.In the recent pursuit of economic progress, gold coast as a developing rude has world-widely come to recognize that the SME heavens may well be the main driving imbibe for growth, due to its entrepreneurial re germs and employment opportunities. Neverthe slight, the existing approachs to explore empirically the roles played by SME in the economic development of a nation are still somewhat ambiguous. This can be attri besidesed, more(prenominal) or less, to the fact that when examining economic progress per se, economists have tended to ignore the industrial structure of the economy and the impact this can have on such development. The ambiguity of the role of SMEs has therefore necessitated the need fo r a subject to be conducted to main course the actual impact of the proliferation of SMEs on the inhabitants of the Medina community.1.2 Problem StatementThe meek patronage domain is recognised as an integral component of economic development and a crucial element in the enterprise to lift countries pop out of poverty (Wolfenson, 2001). The dynamic role of abject and specialty enterprises (SMEs) in developing countries as engines through which the growth objectives of developing countries can be achieved has long been recognized. The growth of dainty outstrip businesses in Ghana so rapid, that it is now seen as a daily affair. Many Potential owners of SMEs move to areas where the emotional state they can succeed to set them up there. More so, many factors may contribute to the movement of people to settle at certain geographical areas.It is believed that the factors that influence migration include the need for peaceful and violent exculpate environment, the need for fer tile business locations, the desire for privacy, government policy and a host of others. Specifically, with noteence to the above, the Medina municipality of the greater Accra region has experienced a noticeable growth and increase in the snatch movements into the area and for that matter SMEs increase in the last few years. It is important to mention that some research studies have been conducted to determine the objective impact of migrations on host societies. In line with the above, this study sorts to valuate the reputation of SMEs in Medina with respect to the engagement of men and women, the main sources investment firms for them, the main objectives and challenges faced by SMEs in Medina, reasons the explosion of SMEs in Medina and the scio-economic impacts of this growth of SMEs in Medina.1.3 Objectives1.3.1 Main ObjectiveThe main objective of this study is to assess the general impact of the plorefication of SMEs in Medina on the Medina municipality of the Greater A ccra region.1.3.2 Specific Objectives1. To assess the nature and forms of SMEs in Medina and the intercourse involvement of women and men. 2. To identify the main objectives and challenges of SMEs in Medina and to rank them in order of importance. 3. Assess the main sources of capital for SMEs in Medina.4. To assess the status of SMEs in Medina with regard to business registration, savings, record keeping and business account holding. 5. To determine the factors that account for the emergence of dwarfish outperform businesses in the Medina community 6. To assess the socio-economic impacts of the growth of SMEs in Medina1.4 Research QuestionsThe study shall provide answers to the following research questions 1. What is the nature of SME operation in Medina and the relative involvement of women and men? 2. What are the main objectives and challenges of SMEs in Medina and which are ranked more importance? 3. What are the main sources of capital for SMEs in Medina?4. What are the st atus of SMEs in Medina with regard to business registration, savings, record keeping and business account holding? 5. What factors have accounted for the emergence of small scale businesses in the Medina community? 6. What are the socio-economic impacts of the growth of SMEs in Medina? 1.5 Justification of the StudyIt is difficult to analyze the performance, nature of operation and behavior of the SME sector in Ghana due to the lack of comprehensive data on them and their activities. The sector is not classified ad into sub-sectors and the last industrial survey was conducted in 1995 but covered only middling and plumping industries. In respect of this, the justification of this study rests on the fact that, study leave roll in the hay help provide cultivation on the nature of SMEs in Medina with respect to the involvement of men and women, the main sources funds for them, the main objectives and challenges faced by SMEs in Medina, reasons the explosion of SMEs in Medina and t he socio-economic impacts of this growth of SMEs in Medina.Furthermore, the study while provide spanking information policy begetrs of the Medina municipality and all other stakeholders of the Medina community. Finally the study while produce information to will add on to existing literature for further studies in this area. 1.6 Scope and Limitations of the StudyDue to epoch and resource constrains, this study is restricted particularly to the Medina community. The study foc use of goods and servicess on the factors that account for the growth of SMEs in Medina and the socio-economic impacts of this change on the people of Medina among others. The study is limited in scope because it fails to cover the entire population of Ghana. The findings of this study may therefore lack generalizability as far as other communities in Ghana are concern.1.7 Organization of the StudyChapter 1 deals with the background of the study, the problem statement, objectives of the study, justification o f the study and organization of the study. Chapter 2 reviews both(prenominal) theoretical and empirical literatures on SMEs in general, in Ghana among others. Chapter 3 introduces the study area and describes the methodologies used to analyze the problems stated. It includes the methods used for data collection, and procedure for data analysis. Chapter 4 is devoted to presentation and discussion of results. compendious statistics of the variables used in the study are presented and discussed. Chapter 5 winds up this study drawing conclusions, their policy implications. Suggestions for prox research based on the findings are do.CHAPTER TWO2.0 LITERATURE REVIEW2.1 IntroductionThis chapter reviews works on small and medium enterprises in the world, Africa and Ghana. The state of SMEs in Ghana is reviewed here. Also, Works on performance and determinants of performance of SMEs are captured. Furthermore, a section of this chapter assesses the various methods of measuring performance of SMEs which while help open up the chthonianstanding of the state of SMEs in Medina. Finally, this chapter closes with some migration theories to help facilitate the comprehension of the factors that actually account for humankind migration, in this case migration to Medina.2.2 Definitions and Concepts of SMEsThere is no single, uniformly acceptable, exposition of a small firm (Storey, 1994). Firms differ in their levels of capitalization, sales and employment. Hence, definitions that employ measures of size (number of employees, turnover, profitability, net worth, etc.) when applied to one sector could lead to all firms being classified as small, while the same size definition when applied to a distinguishable sector could lead to a different result. The first attempt to overcome this definition problem was by the Bolton delegation (1971) when they formulated an economic and a statistical definition. Under the economic definition, a firm is regarded as small if it meets the f ollowing three criteriai. It has a relatively small share of their market placeii. It is managed by owners or part owners in a personalized way, and not through the medium of a formalise management structure iii. It is independent, in the sense of not forming part of a large enterprise. The committal as well devised a statistical definition to be used in three main areas a. Quantifying the size of the small firm sector and its contribution to GDP, employment, exports, etc. b. Comparing the extent to which the small firm sectors economic contribution has changed over snip c. Applying the statistical definition in a cross-country analogy of the small firms economic contribution.Thus, the Bolton Committee employed different definitions of the small firm to different sectors. 2.2.1 Criticism of the Bolton Committees scotch Definition of SMEs A number of weaknesses were identify with the Bolton Committees economic and statistical definitions. First, the economic definition which st ates that a small business is managed by its owners or part owners in a personalized way, and not through the medium of a formal management structure, is incompatible with its statistical definition of small manufacturing firms which could have up to 200 employees. As firm size increases, owners no longer make principal decisions but devolve responsibility to a team of managers.For example, it is un apt(predicate) for a firm with speed of light employees to be managed in a personalized way, suggesting that the economic and statistical definitions are incompatible. another(prenominal) shortcoming of the Bolton Committees economic definition is that it considers small firms to be operating in a perfectly combative market. However, the idea of perfect competition may not apply here many small firms subscribe niches and provide a highly specialized service or fruit in a geographically isolated area and do not perceive any clear competition (Wynarczyk et al, 1993 Storey, 1994). Alter natively, Wynarczyk et al (1993) identified the characteristics of the small firm other than size. They argued that there are three ways of differentiating amid small and large firms. The small firm has to deal with(a) Uncertainty associated with being a impairment taker(b) Limited customer and product base(c) Uncertainty associated with greater diversity of objectives as compared with large firms. As Storey (1994) stated, there are three key fruit distinguishing features between large and small firms. Firstly, the greater external uncertainty of the environment in which the small firm operates and the greater internal consistency of its motivations and actions. Secondly, they have a different role in innovation. atrophied firms are able to produce something marginally different, in terms of product or service, which differs from the alike(p) product or service provided by large firms. A third area of distinction between small and large firms is the greater likelihood of evolut ion and change in the little firm small firms that become large undergo a number of stage changes.2.2.2 Criticism of the Bolton Committees statistical Definition of SMEs (i) No single definition or criteria was used for smallness, (number of employees, turnover, ownership and assets were used instead) (ii) iii different hurrying limits of turnover were specified for the different sectors and two different upper limits were identified for number of employees. (iii) Comparing monetary units over time requires construction of index numbers to take account of price changes. Moreover, currency fluctuations make international comparison more difficult. (iv) The definition considered the small firm sector to be homogeneous however, firms may grow from small to medium and in some cases to large. It was against this background that the European commission (EC) coined the term Small and Medium Enterprises (SME). The SME sector is made up of three components(i) Firms with 0 to 9 employees micro enterprises(ii) 10 to 99 employees small enterprises(iii) ampere-second to 499 employees medium enterprises.Thus, the SME sector is comprised of enterprises, which employ less than 500 workers. In effect, the EC definitions are based solely on employment rather than a multiplicity of criteria. Secondly, the use of 100 employees as the small firms upper limit is more hold assumption the increase in productiveness over the last two decades (Storey, 1994). Finally, the EC definition did not collide with the SME group is homogenous, that is, the definition makes a distinction between micro, small, and medium-sized enterprises. However, the EC definition is too all encompass for a number of countries. Researchers would have to use definitions for small firms that are more appropriate to their particular ass group (an operational definition). It must be emphasized that debates on definitions turn out to be stereotypic unless size is a factor that influences performance. Fo r instance, the relationship between size and performance matters when assessing the impact of a acknowledgement programme on a targeted group ( alike refer to Storey, 1994).2.2.3 Alternative Definitions of SMEsWorld Bank since 1976 Firms with fixed assets (excluding land) less than US$ 250,000 in value are Small Scale Enterprises. Grindle et al (1988) Small scale enterprises are firms with less than or equal to 25 permanent members and with fixed assets (excludingland) worth up to US$ 50,000. USAID in the 1990s Firms with less than 50 employees and at least half the output is sold (also refer to Mead, 1984). UNIDOs Definition for Developing Countries Large firms with 100+ workers Medium firms with 20 99 workers Small firms with 5 19 workers Micro firms with 5 workers UNIDOs Definition for Industrialized Countries Large firms with 500+ workers Medium firms with 100 499 workers Small firms with 99 workers From the various definitions above, it can be said that there is no unique definition for a small and medium scale enterprise thus, an operational definition is required.2.2.4 Definitions SMEs in GhanaSmall Scale enterprises have been variously defined, but the most commonly used criterion is the number of employees of the enterprise. In applying this definition, confusion often arises in respect of the arbitrariness and cut off dits used by the various official sources. As contained in its Industrial Statistics, The Ghana Statistical Service (GSS) considers firms with less than 10 employees as Small Scale Enterprises and their counterparts with more than 10 employees as Medium and Large-Sized Enterprises. Ironically, The GSS in its national accounts considered companies with up to 9 employees as Small and Medium Enterprises (Kayanula and Quartey, 2000). An alternate criterion used in defining small and medium enterprises is the value of fixed assets in the organization.However, the National Board of Small Scale Industries (NBSSI) in Ghana appl ies both the fixed asset and number of employees criteria. It defines a Small Scale Enterprise as one with not more than 9 workers, has plant and machinery (excluding land, buildings and vehicles) not exceeding 10 million Cedis (US$ 9506, using 1994 exchange rate) (Kayanula and Quartey, 2000). The Ghana Enterprise Development Commission (GEDC) on the other hand uses a 10 million Cedis upper limit definition for plant and machinery.A point of caution is that the process of valuing fixed assets in itself poses a problem. Secondly, the continuous depreciation in the exchange rate often makes such definitions out-dated (Kayanula and Quartey, 2000). Steel and Webster (1990), Osei et al (1993) in defining Small Scale Enterprises in Ghana used an employment cut off point of 30 employees to indicate Small Scale Enterprises. The latter however dis-aggregated small scale enterprises into 3 categories (i) micro -employing less than 6 people (ii) very small, those employing 6-9 people (iii) sma ll -between 10 and 29 employees.2.3 Why Small and Medium Scale Enterprises?The choice of small and medium scale enterprises indoors the industrial sector for this study is based on the following propositions (Kayanula and Quartey, 2000).(a) Large Scale Industry(i) Have not been an engine of growth and a good provider of employment (ii) Already receive enormous support through general trade, finance, tax policy and direct subsidies(b) Small and Medium Scale Enterprises(i) Mobilize funds which otherwise would have been idle(ii) Have been recognized as a seed-bed for indigenous entrepreneurship (iii) Are repel intensifier, employing more labour per unit of capital than large enterprises(iv) Promote indigenous technological know-how(vii) Are able to compete (but behind protective barriers)(viii) Use mainly local resources, thus have less foreign exchange requirements(ix) supply for the needs of the poor and(x) Adapt easily to customer requirements (flexible specialization), (Kayanul a and Quartey, 2000). 2.4.0 The Role and Characteristics of SMEs2.4.1 Role of SMEs in Developing Countries diminished rural and urban enterprises have been one of the major areas of concern to many policy makers in an attempt to accelerate the rate of growth in low income countries. These enterprises have been recognized as the engines through which the growth objectives of developing countries can be achieved. They are potential sources of employment and income in many developing countries. It is estimated that SMEs employ 22% of the adult population in developing countries (Daniels Ngwira, 1992 Daniels Fisseha, 1993 Fisseha, 1992 Fisseha McPherson, 1991 Gallagher Robson, 1995). However, some authors have contended that the job creating impact of small scale enterprises is a statistical flaw it does not take into account offsetting factors that make the net impact more modest (Biggs, Grindle Snodgrass, 1988).It is argued that increases in employment of Small and Medium Enterpr ises are not always associated with increases in productivity. Nevertheless, the important role performed by these enterprises cannot be overlooked. Small firms have some advantages over their large-scale competitors. They are able to adapt more easily to market conditions given their broadly skilled technologies. However, narrowing the analysis down to developing countries raises the following puzzle Do lowly enterprises have a dynamic economic role? Due to their flexible nature, SMEs are able to withstand adverse economic conditions. They are more labour intensifier than larger firms and therefore, have lower capital be associated with job understructure (Anheier Seibel, 1987 Liedholm Mead, 1987 Schmitz, 1995).Small-scale enterprises (SSEs) perform useful roles in ensuring income stability, growth and employment. Since SMEs are labour intensive, they are more likely to succeed in smaller urban centres and rural areas, where they can contribute to the more even distribution of economic activity in a region and can help to slow the flow of migration to large cities. Because of their regional dispersion and their labour intensity, it is argued that small-scale production units can bring forward a more fair distribution of income than large firms. They also change the efficiency of domestic markets and make productive use of unusual resources, thus, facilitating long term economic growth.2.4.2 Characteristics of SMEs in GhanaA distinguishing feature of SMEs from larger firms is that the latter have direct access to international and local capital markets whereas the former are excluded because of the higher intermediation costs of smaller projects. In addition, SMEs face the same fixed cost as Large Scale Enterprises (LSEs) in complying with regulations but have limited capacity to market products abroad. SMEs in Ghana can be categorise into urban and rural enterprises. The former can be sub-divided into organised and unorganised enterprises. The org anised ones tend to have paid employees with a registered office whereas the unorganised category is mainly made up of artisans who work in open spaces, temporary wooden structures, or at home and employ little or in some cases no salaried workers.They rely mostly on family members or apprentices. Rural enterprises are largely made up of family groups, individual artisans, women engaged in food production of local crops. The major activities within this sector include- soap and detergents, fabrics, clothing and tailoring, textile and leather, village blacksmiths, tin-smithing, ceramics, timber and mining, beverages, food processing, bakeries, wood furniture, electronic assembly, agro processing, chemical based products and mechanics ( Liedholm Mead, 1987 Osei et al, 1993, World Bank, 1992). It is raiseing to note that small-scale enterprises make better use of scarce resources than large-scale enterprises.Research in Ghana and many other countries have shown that capital producti vity is often higher in SMEs than is the case with LSEs (Steel, 1977). The reason for this is not difficult to see, SMEs are labour intensive with very small amount of capital invested. Thus, they tend to witness high capital productivity, which is an economically strong investment. Thus, it has been argued that promoting the SME sector in developing countries will create more employment opportunities, lead to a more equitable distribution of income, and will ensure increased productivity with better technology (Steel Webster, 1990).2.5 SME ApproachesThere are several approaches or theories to entrepreneurship and small and medium enterprises. For the purpose of this study, the research team will dwell on three major theories. These include venture opportunity, Agency guess and Theory of Equity Funds2.5.1 The risk OpportunityThe venture opportunity school of thought focuses on the opportunity aspect of venture development. The search for idea sources, the development of concepts and the implementation of venture opportunities are the important interest areas for this school. Creativity and market cognizance are viewed as essential. Additionally, according to this school of thought, developing the right idea at the right time for the right market niche is the key to entrepreneurial success. Major proponents include N Krueger 1993, Long W. McMullan 1984. Another development from this school of thought is what is described by McMullan (1984) as corridor principle. This principle outlines that, giving front attention to new pathways or opportunities as they arise and implementing the essential steps for action are key factors in business development.The maxim that preparation meeting opportunity, equals luck underlines this corridor principle. Proponents of this school of thought believe that right(a) preparation in the interdisciplinary business segments will enhance the ability to recognise good venture opportunities. Comparing the study with the above theory, the question that arises is What are the factors or opportunities that have led to the proliferation of small and medium scale enterprises in Medina Township? Is it due to a particular market niche, creativity or market awareness? If so, then what socio-economic impact do they have on the people of Medina Township?2.5.2 Agency TheoryAgency theory deals with the people who own a business enterprise and all others who have interests in it, for example managers, banks, mentionors, family members, and employees. The agency theory postulates that the day to day running of a business enterprise is carried out by managers as agents who have been engaged by the owners of the business as principals who are also know as shareholders. The theory is on the notion of the principle of two-sided legal proceeding which holds that any financial transactions involves two parties, both acting in their own best interests, but with different expectations. Major proponents of this theory includ e Eisenhardt 1989, Emery et al.1991 and JH Davis 1997. These Proponents of agency theory assume that agents will always have a personal interest which conflicts the interest of the principal. This is usually referred to as the Agency problem.2.5.3 Theory of Equity FundsEquity is also cognize as owners equity, capital, or net worth. Costand et al (1990) suggests that larger firms will use greater levels of debt financing than small firms. This implies that larger firms will rely relatively less on equity financing than do smaller firms. According to the pecking order framework, the small enterprises have two problems when it comes to equity funding McMahon et al. (1993, pp153) 1) Small enterprises usually do not have the option of issuing additional equity to the public.2) Owner-managers are strongly averse to any dilution of their ownership interest and control. This way they are unlike the managers of large concerns who usually have only a limited degree of control and limited, i f any, ownership interest, and are therefore prepared to recognize a broader figure of funding options. Modern financial management is not the ultimate answer to every whim and caprice. However, it could be argued that there is some food for thought for SMEs concerning every concept. For example Access to Capital is really eye-opener for SMEs in Ghana to carve their way into sustaining their growth.2.6 Policies for Promoting SMEs in GhanaSmall-scale enterprise promotion in Ghana was not impressive in the 1960s. Dr. Nkrumah (President of the First Republic) in his modernization efforts emphasized state participation but did not encourage the domestic indigenous sector. The local entrepreneurship was seen as a potential political threat. To exacerbate the situation, the deterioration in the Balance of Payments in the 1980s and the overvaluation of the exchange rate led to subject capacity utilization in the import dependent large-scale sector. Rising inflation and falling real wage s also forced many formal sector employees into secondary self-employment in an attempt to actualise a decent income. As the economy declined, large-scale manufacturing employment stagnated (Kayanula and Quartey, 2000).According to Steel and Webster (1991), small scale and self-employment grew by 2.9% per annum (ten times as many jobs as large scale employment) but their activities accounted for only a third of the value added. It was in the light of the above that the government of Ghana started promoting small-scale enterprises. They were viewed as the chemical mechanism through which a transition from state-led economy to a private oriented developmental strategy could be achieved. Thus the SME sectors role was re-defined to include the following (Kayanula and Quartey, 2000) (i) Assisting the state in reducing its involvement in direct production (ii) Absorbing labour from the state sector, given the relatively labour intensive nature of small scale enterprises, and (iii) Devel oping indigenous entrepreneurial and managerial skills needed for sustained industrialization.2.6.1 presidential term and Institutional Support to SMEsTo enable the sector perform its role effectively, the following technical, institutional and financial supports were put in place by government.(i) GovernmentGovernment, in an attempt to strengthen the response of the private sector to economic reforms undertook a number of measures in 1992. Prominent among them is the setting up of the Private Sector informative Group and the abolition of the Manufacturing Industries Act, 1971 (Act 356) that repealed a number of price control laws, and The Investment Code of 1985 (PNDC Law 116), which seeks to promote joint ventures between foreign and local investors. In addition to the above, a Legislative Instrument on Immigrant Quota, which grants automatic immigrant quota for investors, has been enacted. Besides, certain Technology Transfer Regulations have been introduced. Government also pr ovided equipment leasing, an alternative and flexible source of long term financing of plant and equipment for enterprises that cannot afford their own. A Mutual Credit Guarantee purpose was also set up for entrepreneurs who have inadequate or no collateral and has limited access to bank assent.To complement these efforts, a Rural Finance Project aimed at providing long-term credit to small-scale farmers and artisans was set up. In 1997, government proposed the establishment of an Export Development and Investment Fund (EDIF), operational under the Exim Guarantee Company Scheme of the Bank of Ghana. This was in aid of industrial and export services within the first quarter of 1998. To further improve the industrial sector, according to the 1998 Budget Statement, specific attention was to be given to the following industries for support in accessing the EDIF for rehabilitation and retooling Textiles/Garments Wood and Wood Processing aliment and Food Processing and Packaging. It wa s also highlighted that government would support industries with export potential to overcome any supply-based difficulty by accessing EDIF and rationalize the tariff regime in a bid to improve their export competitiveness.In addition, a special monitoring mechanism has been developed at the Ministry of Trade and Industries. In a bid to improve trade and investment, particularly in the industrial sector, trade and investment facilitating measures were put in place. Visas for all categories of investors and tourists were issued on arrival at the ports of entry while the Customs Excise and Preventive Service at the ports were made proactive, operating 7-days a week. The government continued supporting programmes aimed at skills reproduction, registration and placement of job seekers, training and re-training of redeployees. This resulted in a 5% rise in enrolment in the various training institutes such as The National Vocational and Training Institute (NVTI), Opportunity Industrializ ation Centres (OIC), etc. As at the end of 1997, 65,830 out of 72,000 redeployees who were re-trained under master craftsmen have been provided with tools and have become self-employed.(ii) InstitutionsThe idea of SME promotion has been in existence since 1970 though very little was done at the time. Key institutions were set up to encourage SMEs and prominent among them was The Office of Business Promotion, now the present Ghana Enterprise Development Commission (GEDC). It aims at assisting Ghanaian businessmen to enter into fields where foreigners mainly operated but which became available to Ghanaians after the Alliance entry Order in 1970. GEDC also had packages for strengthening small-scale industry in general, both technically and financially. The Economic Recovery Programme instituted in 1983 has broadened the institutional support for SMEs. The National Board for Small Scale Industries (NBSSI) has been realized within the then Ministry of Industry, Science and Technology now (Ministry of Science and Technology) to address the needs of small businesses.The NBSSI open an Entrepreneurial Development Programme, mean to train and assist persons with entrepreneurial abilities into self-employment. In 1987, the industrial sector also witnessed the coming into operation of the Ghana Appropriate Technology Industrial Service (GRATIS). It was to supervise the operations of negociate Technology Transfer Units (ITTUs) in the country. GRATIS aims at upgrading small scale industrial concerns by transferring appropriate technology to small scale and informal industries at the grass root level. ITTUs in the regions are intended to develop the engineering abilities of small scale manufacturing and service industries engaged in vehicle repairs and other colligate trades. They are also to address the needs of non-engineering industries. So far, 6 ITTUs have been set up in Cape Coast, Ho, Kumasi, Sunyani, Ta anthropoid and Tema.(iii) Financial AssistanceAccess to c redit has been one of the main bottlenecks to SME development. Most SMEs lack the necessary collateral to obtain bank loans. To address this issue, the Central Bank of Ghana has established a credit guarantee scheme to underwrite loans made by Commercial Banks to small-scale enterprises. Unfortunately, the scheme did not work out as expected. It was against this background that the Bank of Ghana obtained a US$ 28 million credit from the International Development Association (IDA) of the World Bank for the establishment of a Fund for Small and Medium Enterprises Development (FUSMED). Under the Programme of Action to Mitigate the Social Cost of Adjustment (PAMSCAD), a revolving fund of US$ 2 million was set aside to assist SMEs. This aspect is too scanty in the midst of the abundant information, especially with reference to Ghana.2.7 Gender and Small Business PerformanceUntil more belatedly gender differences in small business performance remained largely unaddressed by social scient ists (Greene, Hart, Gatewood, Brush, Carter, 2003). The volume of studies either disregarded gender as a variable of interest or excluded pistillate subjects from their soma (Du Rietz Henrekson, 2000). However, it is generally accepted that male and female person owner-managers behave differently and that these behavioral differences influence their performance (Brush, 1992), but these differences have been recognized but not fully explained (Brush Hisrich 2000). A comparison of performance of male and female owner-managers in Java, Indonesia showed that female-owned businesses tend to be less oriented towards growth compared to male-owned businesses (Singh, Reynolds, Muhammad, 2001).Boden Nucci (2000) investigated start-ups in the retail and service industries and effect that the mean survival rate for male owned businesses was four to six percent higher than for female owned businesses. Loscocco, Robinson, Hall Allen (1991) in their study of small businesses in the New E ngland region of the USA found that both sales volume and income levels were lower for female- than for male-owned businesses. In a longitudinal study of 298 small firms in the United Kingdom (UK), of which 67 were female owned, Johnson Storey (1994) observed that whilst female owner-managers had more stable enterprises than their male counterparts, on average the sales turnover for female owners were lower than for male owners.Brush (1992) suggests that women perform less on quantitative financial measures such as jobs created, sales turnover and profitability because they pursue inbred goals such as independence, and the flexibility to combine family and work commitments rather than financial gain. In contrast to the above findings, Du Rietz and Henrekson (2000) reported that female-owned businesses were just as successful as their male counterparts when size and sector are controlled. In his study of small and medium firms in Australia, Watson (2002), after controlling for the effect of industry sector, age of the business, and the number of days of operation, also reported no significant differences in performance between the male- controlled and female-controlled firms.