Archives of Current Research International

The paper examined digital accounting system (DAS) and the performance and sustainability of SMEs in Nigeria. The paper highlighted the importance of DAS to SMES’ performance and sustainability Digital accounting system has helped some SMEs from financial collapse such as reducing errors, have a straight record and to have a clear financial picture for easy decision making. Three research were questions guided the study and three hypotheses were tested at 0.05significance level. The study considered 200 samples from estimated population of entire population of SMEs business that cut across manufacturing sector, service sectors, agricultural sector, trading sector and other sectors that are using digital accounting systems. Out of 200 questionnaires distributed, 106 were returned, yielding a response rate of 53%. Two key metrics, Composite reliability and average variance extracted (AVE) were investigated to examine the reliability and validity of the study’s constructs. Based on the Cronbach’s alpha, shows that all constructs demonstrate Composite reliability values well above the 0.7. the result of the study reveal that awareness and usage of Digital Accounting System (DAS) have positive and direct solid relationship with Sustainable and Performance of SMEs in Nigeria. The path coefficient was 0.119, the T-statistic was 2.780, and the p-value was 0.037. the study further revealed that perceived benefit of adopting digital accounting system has positive and direct solid relationship with Sustainability and Performance of SMEs in Nigeria. The path coefficient was 0.140, the T-statistic was 2.991, and the p-value was 0.027 confirms a positive and significant impact of DAS awareness and usage on SMEs performance. it was recommended among others that practical insights for policymakers and SME owners, reinforcing the role of digital transformation in Nigeria’s economic development.