Browsing by Author "MULONDWA, Ruth"

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    Assessing the Role of Financial Audits in Enhancing Growth of Agro-Based Msmes in Lusaka: A Comparative Study of Audit-Adopting and Non-Adopting Enterprises
    (2026) MULONDWA, Ruth
    Micro, Small, and Medium Enterprises (MSMEs) are pivotal to Zambia’s economic development, contributing substantially to employment creation and Gross Domestic Product (GDP) growth. Within this sector, agro-based MSMEs play a vital role in promoting food security, rural development, and inclusive economic progress. Despite their importance, these enterprises face persistent challenges that hinder their growth, notably weak financial governance, inadequate internal controls, and restricted access to finance. Although financial audits are widely acknowledged for enhancing transparency, accountability, and access to capital, their uptake among agro-based MSMEs in Lusaka remains limited. Many business owners perceive audits primarily as compliance obligations, often driven by donor or regulatory requirements, rather than as strategic instruments for fostering business growth and sustainability. This study investigates the role of financial audits in supporting the growth and long-term sustainability of agro-based MSMEs in Lusaka. It specifically contrasts the experiences of enterprises that have adopted audits with those that have not. Employing a qualitative comparative approach, data were gathered through semi-structured interviews and questionnaires administered to 48 stakeholders, including MSME owners and managers, auditors, financial institutions, and relevant regulatory bodies. Thematic analysis was conducted using Atlas to identify patterns and derive insights from the qualitative data. Findings indicate that MSMEs engaging in audits demonstrate stronger financial management practices, improved access to finance, and enhanced decision-making capabilities. Nonetheless, misconceptions regarding the cost, complexity, and purpose of audits remain prevalent, particularly among non-adopting firms. Key barriers include limited audit literacy, insufficient institutional support, and the lack of audit frameworks tailored to the needs of MSMEs. The study recommends that the Zambia Institute of Chartered Accountants (ZICA) develop simplified audit guidelines and promote affordable audit solutions through collaborations with audit firms and academic institutions. Furthermore, the Zambia Development Agency (ZDA) is urged to incorporate audit readiness into its business support services and incentivise audit adoption through grants and other innovative mechanisms. By repositioning audits as strategic tools for business development, these interventions can encourage voluntary adoption and strengthen the resilience of Zambia’s agro-based MSME sector.