School of Accountancy (ETDs)

Permanent URI for this communityhttps://hdl.handle.net/10539/37779

Browse

End date: 2019

Search Results

Now showing 1 - 10 of 40
  • Thumbnail Image
    Item
    Identifying obstacles to the growth of new SMEs: A Factor Analysis Approach
    (Identifying obstacles to the growth of new SMEs: A Factor Analysis Approach, 2019) Mphahlele, Dorothy B.; Merino, Andres
    It is widely acknowledged that Small and Medium-Sized Enterprises (SMEs) are key drivers of economic growth and job creation in developing countries. It has also been established that new SMEs face common problems that arise as they grow and develop. These challenges stem from internal as well as external factors that can have an adverse impact on their survival and growth. The objective of this study was to identify the internal and external obstacles to the growth of SMEs. A questionnaire was used to collect data on factors affecting the growth of SMEs. The results of the questionnaire were analysed using Factor Analysis. Eight different factors were identified. These factors were further analysed to determine their impact on SMEs. The ranking of the factors in order of importance was as follows: lack of access to finance, overregulation, the economic environment, high competition, lack of internal resources, high input costs, lack of experience of the entrepreneur and poor service delivery. The report examines possible ways of mitigating the adverse factors identified and makes a series of recommendations to increase the likelihood of the survival of SMEs in the South African context.
  • Thumbnail Image
    Item
    The principles governing 'place of effective management' and 'permanent establishments' and their application to the digit al economy: a South African perspective
    (2016) Boel, Katherine
    The purpose of this research report is to consider the application of existing 'place of effective management' (POEM) and 'permanent establishment' (PE) principles to a company operating in a digital economy in order to determine its appropriateness and limitations. This paper is broadly divided into four parts. The first part of the paper provides a brief background to the above taidng principles and the digital economy. The second part considers, in detail, the guidance and factors that are currently available on how the POEM and the creation of a PE for a company may be determined both internationally and from a South African tax perspective, including the role of the residency tie-breaker article and the PE article in most double taxation agreements (DTA's) with South Africa. The third part of the paper considers how these guidelines and factors may apply to the digital economy and the practical challenges which arise. Finally, the paper seeks to identify possible alternatives to overcome the pitfalls in the POEM and PE interpretations and to highlight aspects which require further consideration.
  • Thumbnail Image
    Item
    Equalising taxing rights in the digitalised economy: an analysis of diverse tax practices implemented globally
    (2019) Forman, Ashleigh
    There are limitations to the application of existing international tax laws as a result of digitalisation as these were formulated based on traditional ‘brick and mortar’ transactions. These laws are not well suited to the realities of the ‘modern way of doing business’ as they do not cater for business models which can generate returns from offering digital services in a jurisdiction without being physically present in that jurisdiction. Ultimately, if left unaddressed, these weaknesses threaten to expose tax authorities to erosion of national tax bases and profit-shifting manipulation (OECD, 2015b). The international tax framework needs to be responsive to the changing nature of global economies in the digital age. The tax framework should be able to accommodate new digital businesses which operate and create value in different ways (Saint-Amans, 2017). As a result, “there is a disconnect between where value is created and where taxes are paid” (European Commission, 2018b). In response to digitalisation, different jurisdictions have hastily imposed their own domestic tax practices to prevent further base erosion and to improve the collection of tax revenue (Petruzzi and Buriak, 2018). The OECD has attempted to address these tax challenges but has failed to provide clear guidance on taxing rights, as well as on how the profits should be allocated (Medus, 2017). The objective of this report is to summarise the tax practices implemented by the United Kingdom, the European Union, Italy and India in responding to the digitalisation of the economy. The aim will be met through a correspondence analysis between the different tax solutions implemented or proposed by these jurisdictions, and the problems identified in taxing the digital economy.
  • Thumbnail Image
    Item
    The emancipatory potential of extinction reporting in the public sector : an analysis of trends in South African National Parks
    (2019) Buchling, Michael Carl
    South Africa is home to biomes which cannot be found anywhere. The rich biodiversity within her borders requires protection from extinction events and activities which can lead to a decrease in biodiversity mass. SANParks is responsible for the conservation and preservation of biodiversity within South Africa and reports on how it meets its mandate not only to protect biodiversity but also to use biodiversity in a sustainable manner which improves the socioeconomic circumstances of local communities. The study is the first to explore biodiversity disclosure themes in a state-owned entity in South Africa, responsible for the conservation, and uses the disclosure to construct an emancipatory extinction account. The study is qualitative, using content analysis to investigate the disclosure themes in the SANParks reports. The findings indicate that SANParks increased the quantum of information on biodiversity over five years (2013 – 2017) suggesting an integrated thinking approach is adopted by SANParks in disclosing biodiversity. While the current disclosure practices of SANParks does not provide a comprehensive extinction account, the results of the content analysis are used to develop a reporting framework which can be used to provide a detailed emancipatory extinction account, drawing on principles from the IIRC, financial accounting literature and biodiversity-related literature. The study adds to the existing body of knowledge by incorporating the six capitals in the extinction reporting framework.
  • Thumbnail Image
    Item
    A multidimensional analysis of the professional accountant’s ethical judgement and behavioural intentions
    (2019-02) Subramanian, Kaveshan
    Orientation: The professional accountant’s ability regarding ethical decision-making has come under increased scrutiny within recent times. This is particularly relevant within the South African accountancy environment given the recent accounting scandals that surfaced during 2017 and 2018. For professional accountants to achieve the goal of serving the public interest, they are required to have a mindset that fosters ethical-decision making. Research aim: The primary aim of this study was to explore the different factors which influence ethical judgement and behavioural intentions of professional accountants and to investigate which are significant factors which influence ethical-decision making. Ethical judgment involves the ability of the participant to recognise the seriousness of an ethical conflict whereas ethical behavioural intentions focus on the willingness of the participant to behave ethically. The secondary aim of the study was to explore the effect of demographical characteristics on ethical decision-making. Motivation for study: From a South African perspective, it is critical to ensure that professional bodies who are tasked with developing the accounting profession as well as serving the public interest gain a better understanding of the different factors which influence ethical judgment and behavioural intentions of professional accountants. Research approach and method: This study used a multidimensional ethics scale (MES) to measure the significant considerations of professional accountants when faced with an ethical dilemma. A quantitative research approach was followed and a questionnaire based upon the MES and three tax related ethical dilemmas was used to gather data. To address the research aims of the study, two research questions were answered through hypothesis testing which involved both descriptive and inferential statistical methods. Main results: The primary results indicated that factors such as morality, fairness, justice and acceptability to one’s family play the most significant role in influencing the ethical judgement of professional accountants. In addition, it was found that egoism which prioritises the long-term self-interest of the professional accountant significantly influences their ethical behavioural intentions. Lastly, the secondary results indicated that demographical characteristics such as rank and highest qualification attained by professional accountants play an important role in influencing the mind of the professional accountant when faced with an ethical dilemma. Application: This study contributes to the existing body of research involving ethical decision-making of professional accountants. This is an important topic in the current discourse on accounting and amongst accounting professionals. Furthermore, the results of this study can also form the basis of a mechanism for change within professional accounting bodies (PAO’s). The results of this study can be applied to assist in re-aligning continuous professional development (CPD) programmes. Based on the results, professional bodies can shift their focus in terms of CPD’s towards prioritising public interest as a key consideration for current and future accountants. To this end, PAO’s and higher education institutions can use this contribution when designing a new syllabus which addresses the issues that arise around ethical decision-making. Contributions: Key conclusions of this study contribute to the understanding of professional accountants’ ethical judgment and behavioural intentions. The topic under investigation is in direct response to calls for increased research on ethical judgement and behavioural intentions of professional accountants. The results also contribute towards a better understanding of the effects of gender, rank and professional qualifications on ethical decision-making.
  • Thumbnail Image
    Item
    A case study: an exploration of the implications of computer-assisted audit techniques on the audit approach in terms of the key elements of an assurance engagement.
    (2019-08) MacDonald, Darren Kyle
    Not only has IT become more prominent in the business environment, but it has also expanded the available tools at the auditors’ disposal. These tools are more commonly known as CAATs. The implications of CAATs have not been addressed adequately in the academic environment. As a result, this leads to the purpose of this research report: to illustrate the implications of introducing CAATs in the audit process on the five key elements of an assurance engagement. A case study methodology has been selected to explore this audit approach in great detail by focusing on one client and its audit firm. This methodology has been chosen to illustrate the context of a computerised audit and its specific consequences over a period of time. As a result, this study has managed to demonstrate the benefits from introducing CAATs throughout each key area of the audit process. In order to achieve these benefits, the auditor needs to consider several matters to ensure an efficient IT-based audit is realised.
  • Thumbnail Image
    Item
    Change of audit firms and whether it enhances independence
    (2018) Govender, Keshika
    This paper explores the change in auditors and whether it enhances auditor independence and credibility of financial statements. In recent years due to financial crises and accounting scandals, the rotation of a company’s auditors, after long standing relationships, have come into the limelight. The independence of auditors has come into question and the credibility of financial statements. Interviews were conducted to gain an understanding of how an audit client, referred to in this report as the Company, changed its auditors. The interviews gained an understanding of how the Company: • Made the decision to change and appoint new auditors • Determined whether this change enhanced independence and • Created processes in order to manage the changeover. The Company carrying out the change was analysed in order to understand the processes which were put in place to manage the change. Understanding the criteria and skills required from the new auditor was also investigated. The study finds that the process of appointing and transitioning to new auditors is a comprehensive and rigorous task. This process requires proper and careful planning, risk identification and process and project management. Throughout the process, the Company met with business its operations and provided feedback to members of the boards to ensure gaps were filled and targets and milestones were met. The onboarding of the new auditors required engagement with both the auditors and different functions and businesses of the Company. The success of this project required intense planning and incredible momentum, which the study shows, over the period of time in which the change took place. It required integration with all businesses of the Company and the group finance function.
  • Thumbnail Image
    Item
    A comparison of the performance of Riet strategies in South Africa
    (2019-11-11) Kubheka, Ntombenkulu
    As the objective of investing is the maximization of wealth, it is imperative for investors to find instruments which will help them achieve their goal. A real estate investment trust can be a form of wealth maximization if an investor is knowledgeable about its long-term performance and the drivers of this performance. This study employed the use of panel regression models to isolate the performance of South African REITs, in order to compare the risk-adjusted returns of REIT segments over the long term and to identify the determinants of REIT risk-adjusted returns. Risk-adjusted performance ratios were used to measure return on real estate investment funds to conclude on the performance of SA REITs. The Sharpe ratio, Treynor index and Jensen’s Alpha were performance measures of 55 JSE-listed and delisted REITs over 18 years (2000 – 2017) thus incorporating 433 firm-years.The empirical evidence suggests that size, book-to-market, property asset intensity, dividend yield and real GDP growth influence the performance of South African real estate investment trusts and Hotel and Resort REITs as well as Retail REIT significantly underperformed the other REIT sectors, under the Sharpe ratio and Jensen’s Alpha. Furthermore, the REIT performance during the financial crisis outperformed their performance during the other market phases.
  • Thumbnail Image
    Item
    The effects of the individual BEE scorecard elements on the performance of JSE-listed firms in South Africa
    (2019-02-27) Lilian, Abraham
    Black Economic Empowerment (BEE) legislation was introduced in South Africa to combat the significant modern-day racial inequality caused by Apartheid. While social returns are the primary objective of BEE, one must assess whether compliance with this legislation has also yielded financial returns. Prior studies have mainly focused on the effect of the composite BEE Scorecard on performance, and have produced inconclusive and conflicting results. This study therefore aims to gain further insight into the impact of the BEE scorecard by isolating the influence of each element of the BEE scorecard on performance. A quantitative study was undertaken using Johannesburg Stock Exchange-listed firms as the population. A multivariate panel regression analysis was performed using return on assets (ROA), return on equity (ROE) and share returns (SHR) as proxies for performance over the period 2011 to 2017. The final sample translated into 346 company-year observations for the ROA and ROE models, and 381 for the SHR model. Initial analyses evidenced a strong positive correlation between ROA/ROE and Employment Equity. The regression analyses, which controlled for profitability, growth, asset utilisation, debt, size, industry and macro-economic factors, returned two significant findings. The Ownership element of the scorecard was positively associated with both ROA and ROE, while Socio-Economic Development was negatively associated with ROA. The findings from this study add to the body of BEE research that shareholders, managers and policy-makers can consider when making decisions about BEE policies. Ongoing research to further develop these findings will assist companies in supporting the movement for economic unity while maximising their own value creation.
  • Thumbnail Image
    Item
    An examination of tampon tax and how it effects the social, health and economical aspects of countries including a comparative analysis of how some countries have dealt with tampon tax
    (2019) Asmaljee, Sumaiyah Safi
    Tampon tax is a colloquial term in common usage describing taxes levied on female menstrual hygiene products that are taxed as luxury goods in spite of the fact these items are considered necessities such as food and medicine, which are either exempted or taxed at 0% in some countries. Tampon tax in South Africa is the levying of value-added tax (VAT), to female menstrual hygiene products. Internationally, activists have initiated various campaigns and protests for the removal of tampon tax as it is not regarded as a luxury but rather a necessity, and South Africa has followed suit. There have been various campaigns and initiatives towards making female menstrual hygiene products more affordable and/ or accessible to the females from low-income households in South Africa. Reduction in sales tax rates, removal of goods and services tax on female menstrual hygiene products and the utilisation of the income earned from sales tax on female menstrual hygiene products are options available to negate the economic effects of tampon tax on females in their reproductive years. This paper discusses tampon tax and its effect on social, health and the economic well-being of South Africa. The paper will include comparative analyses to what is being done in some countries to alleviate the negative effects of the tampon tax. This paper will also examine the value-added tax in South Africa. Arguments in favour of and against tampon tax are also discussed.