Micro and Small Enterprises are a very important sector that continues to contribute enormously for the economic development of the country and to the state of Manipur in particular. The success and failure of these enterprises depends a lot on the efficient management of its financial resources. This paper therefore attempts to study the accounting and financial management practices followed by the Micro and Small Enterprises (MSEs) in Manipur and to make an awareness about the importance of accounting and financial management practices in their business conduct. For the purpose of the study both primary and secondary data are used. Secondary data were collected from the related available literature like books, articles, magazines, MSME annual report, directory of MSME Manipur, etc. Primary data is obtained by distributing questionnaire to 100 respondents who are owner/manager of the MSEs. The collected data were analysed using various statistical tools to get meaningful conclusion. The results of the study revealed that majority of the MSEs do not maintain proper accounting records of their business which made it difficult for the owner-manager to measure the performance of their business. The main reason for the failure of the enterprises to keep proper accounting records is their lack of knowledge in accounting. The financial management practices followed by the MSEs in Manipur are only fire-fighting in nature and no standard rules or procedures are followed for managing their finance. Finally, the study suggested that both the Central and the State Government should make strict rules and regulations to adopt accounting and financial management practices to each and every MSEs operating in the state