Analysis of Accounting Understanding and Financial Literacy on the Sustainability of MSME Businesses
Keywords:
EMKM Accounting Understanding; Financial Literacy; MSME Business Sustainability; MSMEs; Jombang RegencyAbstract
This study aims to analyze the influence of EMKM accounting understanding and financial literacy on the sustainability of MSME businesses in Jombang Regency. MSMEs play a vital role in regional economic development; however, their sustainability is often constrained by weak financial management and limited accounting practices. This research adopts a quantitative associative approach using primary data collected through questionnaires distributed to 100 MSME actors in the agribusiness sector who have operated for at least two years. The data were analyzed using multiple linear regression, supported by validity, reliability, and classical assumption tests. The results indicate that EMKM accounting understanding has a positive and significant effect on MSME business sustainability, with a t-statistic value of 3.709 and a significance level of 0.000. Similarly, financial literacy shows a stronger positive and significant effect, with a t-statistic of 6.244 and a significance value of 0.000. The Adjusted R Square value of 0.874 demonstrates that both independent variables simultaneously explain 87.4% of the variation in MSME business sustainability. These findings confirm that improving accounting understanding and financial literacy is essential for enhancing MSME sustainability, with financial literacy playing a more dominant role. This study provides empirical evidence to support MSME development policies focused on strengthening financial capability and accounting competence.
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