Explain a little more on ownership. Some family owned companies can be very big multinationals and even be listed. A family owned \controlled Company with 60% family and 40 % listed has to comply with listing requirements and data can be publicly available. Estimates show that approximately 46% of S&P 1500 firms are family owned. Do you mean 100% family owned? I have seen a paper that defined a family firm as one where members of the founding family continue to hold positions in top management, are on the board of directors, or are large block holders of the company. Some resources to look for include:

1. Ali, Ashiq and Chen, Tai-Yuan and Radhakrishnan , Suresh, Corporate Disclosures by Family Firms. Journal of Accounting and Economics, Forthcoming. Available at SSRN: http://ssrn.com/abstract=962782

2. CHEN, S., CHEN, X. and CHENG, Q. (2008), Do Family Firms Provide More or Less Voluntary Disclosure?. Journal of Accounting Research, 46: 499–536. doi: 10.1111/j.1475-679X.2008.00288.

3. Wang, D. (2006). Founding family ownership and earnings quality. Journal of Accounting Research 44 (3): 619-656.

Good luck with your research

Erick Outa

Thank you Mr Erick Outa. yes I mean 100% family owned firms.

Analysis may not be a problem because quantitative, qualitative techniques or mixed methods can be applied depending on the data and your research objective. However data availability will be a nightmare especially in East Africa. If there is a regulator or a registrar of such companies in your country and your country supports research under strict research protocol, then one way is to collaborate with the regulator and sell the idea of the benefits of such research. You may get some sketch reports from the regulators. In Kenya for example, the registrar of companies should be receiving returns from companies each year, but it is a very sensitive area that one cannot determine what is available or not. Moreover, most of them are lawyers whose main interests are legal requirements. So most people have ended their research with publicly quoted companies where data is available.

You may also end up approaching the family companies through a questionnaire on the challenges and issues with financial reporting. Most likely they prepare minimal accounts for tax or bank loans. You could then use exploratory studies applying qualitative techniques to see whether this people actually do any financial reporting. Remember , financial reporting is for public interest entities where professional institutes prescribe accounting standards and regulators expect corporate governance and so demands that financial reports be prepared. Other entities do not have an obligation to prepare such reports and so most if not all do not prepare them. In any case to whom will they be prepared for.

You may also liaise with global development partners who train and guide some of these SMEs. For example IFC\World bank sometimes trains SMEs on corporate governance (reporting and disclosures for credit acquisition), some universities teach entrepreneurs basic business skills and financial planning and the world bank also runs financial inclusion projects in rural areas and these can be good starting points for collaboration and understanding of what these businesses do.

Finally, any one with experience with family owned firms can tell us how much the owners are willing tell the public.

Best and good luck in your studies

Erick Outa

Thank you Mr Erick Outa. be blessed.

En mi país no existe tratamiento diferente para recabar información financiera de empresas corporativas o de empresas familiares. El formato para presentación de balances, responde a las necesidades de aplicación  de las NIIF´s (Normas internacionales de Información Financiera)y en su defecto, de las NEC's (Normas Ecuatorianas de Contabilidad).

Si bien es cierto que la gran mayoría de empresas establecidas son PYMES (pequeñas y medianas empresas) y de ellas un alto porcentaje se clasifican como familiares, Todas tienen que alinearse a un formato impuesto por la Superintendencia de Compañías. (sobre la base NIIF).

Saludos

JFlores

Jose,

The problem of being international with one language -English, is quite big. Could  some one offer to translate Jose s contribution?

This is JFlores response in English. He basically says that there is only one law applicable to all companies ie one size fits all. It is the ideal situation but many small companies in EAST Africa ,for cost, inefficiency  and other reasons do not engage in the prescribed reporting and no one seems to follow them. Recently , NGOs in my country were asked to submit audited accounts to their regulator and most elected to shut down and go. It turned political instead.

"In my country there is no different treatment to obtain financial information from corporate companies or family businesses. The format for presentation of balance sheets , responds to the needs of implementing the NIIF's (International Financial Reporting Standards ) and failing that , the NEC 's ( Reporting Standards ) .

While the vast majority of companies established are SMEs ( small and medium enterprises ) and a high percentage of them are classified as family , all have to be aligned to a format imposed by the Superintendency of Companies . (based on IFRS).

regards

JFlores"

Noted. Thank you kaka