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    An analysis of the trends in integrated reporting by South African government-owned enterprises.
    (2023) Omarjee, Ayesha.; Vanker, Salma.
    In recent times, government-owned enterprises have faced a deficit in terms of accountability. Addressing this issue, there has been a call for an oversight mechanism to enhance governance and consequently, accountability within state-owned companies (IOD and PWC, 2011). Integrated reporting has emerged as a response to this demand, primarily due to its capacity to offer a comprehensive perspective on the factors that contribute to value creation for an organisation over different time frames. Recognising the advantages that integrated reporting brings to corporate governance, South African government-owned enterprises have acknowledged its potential and subsequently incorporated integrated reporting in accordance with King IV principles and the IR Framework. The objective of this research is to analyse the patterns in integrated reporting among government-owned enterprises according to The Public Finance Management Act of 1999, focusing on the financial periods of 2018, 2019, and 2020. This study assesses the depth of information disclosed by government-owned enterprises and its alignment with the suggestions and criteria set forth by the King IV guidelines and IR Framework for integrated reporting. This evaluation utilizes a scorecard methodology to gauge the degree of disclosure achieved by each individual government-owned enterprise. Based on the empirical facts from the analysis, it is clear and conclusive that the level of reporting and disclosure of government-owned enterprises has improved consistently over the years. This assertion is based on the evident adoption and the upward trend in the application of the Integrated Reporting Framework for integrated reporting by government-owned enterprises. Whilst the overall average level of disclosure is good, there is without debate a necessity for improvement in some critical areas highlighted in this research . Notable among these areas are leadership, governance, stakeholder relationships, organizational ethics, and corporate citizenship.
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    Impression management observation in South African district municipalities through attribution theory lens.
    (2023) Mgoyana, Sithandiwe.; Phesa, Masibulele.
    District municipalities play a crucial role in the local government as they have the mandate to provide services to the communities and capacitate and assist local municipalities in their jurisdiction for the provision of services delivery. Most South African district municipalities are struggling to fulfil the mandate of delivering services to the communities and this is evidenced by delivery protests for poor service delivery across South African communities. Inability to provide proper service delivery by most South African district municipalities causes them to get pressure from political opposition and the communities at large, hence they resort to partake in impression management. The mayor’s foreword is a narrative disclosure in the annual report that has no guideline in terms of what gets included in it. Management of municipalities have the discretion on what to include, which makes the mayor’s foreword open to manipulation, and as such, can be a place for employing impression management tactics. This study examined the presence of impression management tactics in the mayor’s foreword in the annual reports of South African district municipalities. The study followed the quantitative research method. Quantitative content analysis was used to analyse the mayor’s foreword contained in the annual reports of 34 district municipalities in South Africa. Data were extracted from the annual reports available on the websites of district municipalities. Impression management tactics, in the form of textual characteristics, were examined based on the length, use of passive voice, use of personal reference, use of positive tone, and observation of readability. The study revealed that district municipalities use impression management tactics in the mayor’s foreword. The study revealed that non-performing district municipalities have used a lot of personal references, and more passive voice than performing even though not significant, while performing have used significantly more positive tone than nonperforming district municipalities. The study revealed that performing district municipalities have lower readability scores than non-performing. Furthermore, there is no significant difference between performing and non-performing district municipalities on the length of the mayor’s foreword, use of passive voice, use of personal references and the readability score. The study brings new insights into the use of impression management tactics in the public sector, specifically in local government. It further extends the debate on impression management and self-attribution.
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    The managers’ perceptions of irregular expenditure In the KwaZulu-Natal municipalities.
    (2018) Zungu, Amos.; Mkhize, Msizi Vitalis.
    Background: While the Municipal Finance Management Act (MFMA, 2003) requires accounting officers to prevent irregular expenditure, municipalities continue to incur such expenditure. Aim: This study aimed to determine the managers’ perceptions of irregular expenditure in the KwaZulu-Natal municipalities; their perceptions of councillors’ oversight of such expenditure, and managers’ views on the capacity of Municipal Public Account Committees (MPACs) to fulfil their oversight role. Setting: The setting for this study is municipalities in KwaZulu-Natal. Methods: A descriptive and analytical cross-sectional design using systematic sampling was employed. The responses of 52 managers were analysed. Results: Managers agreed on the need for compliance with procurement processes and proper planning. They also concurred that irregular expenditure negatively impacts social transformation and wealth redistribution. The study respondents were of the view that irregular expenditure occurs due to manipulation and unfair practices, a lack of transparent supply chain management processes and politicians’ interests in tenders. In their opinion, councillors fail to investigate liability for irregular expenditure as required by section 32(2) (a) and (b) of the MFMA. They reported that serious cases of irregular expenditure where there were allegations of fraud, theft and corruption had not been investigated. Furthermore, disciplinary proceedings were not instituted against those that did not act in good faith and committed serious financial misconduct that resulted in municipalities incurring financial losses. Conclusion: Irregular expenditure harms municipalities’ image and negatively impacts social transformation. Municipalities, Cooperative Governance and Traditional Affairs (CoGTA) and the South African Local Government Association (SALGA) should invest in capacity building, implement effective fraud prevention plans and enhance the capabilities of those in charge of oversight. Contribution to the Study: The study makes a practical contribution towards understanding of the incidence of irregular expenditure and how it can be prevented. In addition, the study is the first to be undertaken in South Africa. This will serve as a foundation and source of reference for further studies.
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    A qualitative analysis of auditors' responsibility in South African corporate scandals.
    (2023) Govender, Kenthran.; Lathleiff, Charmaine.
    For time immemorial, the audit profession has faced backlash from the users of the annual financial statements (AFS) for not doing enough. The calls for the auditor to do more come at times when the entities being audited go into liquidation, business rescue or become corporate failures and these entities were audited with no issues being detected and reported to the users in the audit report. This resulted in financial losses to the users of the AFS who made economic decisions based on the AFS that were audited. The response by auditors is often that it is not their job to prevent corporate scandals or to detect fraud. The role of the auditor in contributing to the corporate scandals not being detected and reported was explored in this study. This study employed a qualitative document analysis approach to analyse the contents of documents relating to the performance of the audit on corporate scandals that occurred in South Africa since 2000 and for which information on the performance of the audit was publicly available. A total of three corporate scandals were explored to determine the contribution of the auditor to the corporate scandal not being detected and reported. A self-developed index was used to categorise the findings into the standard of audit work performed to answer the research questions and achieve the research objectives. It was found that in all three corporate scandals that were analysed, an inappropriate audit opinion was issued and therefore, an audit failure existed. Further, it was found that the audit partner was not independent and detected the material misstatements in the AFS but failed to report the misstatements in the audit report in all three instances. This study sought to provide an understanding of the contribution of the auditor to the corporate scandal. This study provided insight to the role of the auditor in not detecting and preventing corporate scandals and specifically where the problem lies. To the best of the author's knowledge, this study was the first study that explored the contribution of the auditor to corporate scandals not being detected and reported. Future research could explore the role of auditors in more corporate scandals as more information becomes available as well as exploring the role of auditors in corporate scandals in other countries.
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    The impact of digitalisation of clearing and forwarding processes on the workforce.
    (2023) Jin, Emmanuel Nyouweke.; Gumede, Sanele.
    ABSTRACT Globalisation has brought about many changes. There has been substantial innovation in the value creation approach to the supply chain and the application of digital enabling technologies. This has been necessary to meet the ever-increasing demand for goods in the global markets. At the centre of this approach are the activities of customs clearing and forwarding. Trade liberalisation and the standardisation of global customs procedures mean that customs clearing and forwarding agents must deal with greater volumes of goods within a short timeframe. This has necessitated the digitalisation of these processes to perform these tasks quicker and with more accuracy and, often requiring little or no human intervention in some instances. Literature in developed economies indicates a negative impact of this on the workforce in terms of job losses. However, the situation may be felt more in a country like South Africa which is already facing the triple threat of inequality, record-high unemployment, and poverty. This study investigates the impacts of the digitalisation of customs clearing and forwarding processes on workforce and productivity. The research adopted a qualitative approach, using snowball non-probability and purposive sampling techniques. Interviews were conducted with ten selected individuals who each had over 20 years of industry experience in clearing and forwarding. Their experience provided insight which spanned the timeframe under consideration. Data collected through interviews and secondary sources were analysed using open, axial, and selective coding techniques. The analysis was divided into three main themes, namely i) customs clearing and forwarding processes pre-digitalisation (2000-2005); ii) Early digitalisation (2005-2010); and iii) digitalisation 2010 to present, and its impact on workforce and productivity. Findings showed a negative impact on the workforce in the pre-digitalisation period, with race and gender bias. In the early digitalisation phase, findings showed a negative impact on the workforce, with older workforces reluctant to adapt and going on early retirement or being retrenched. The low productivity in the early inception phase is primarily due to adaptation challenges. In the final phase, digitalisation has positively impacted the workforce and productivity. Companies have embraced technology and can clear more goods within a shorter time, giving them exposure to more international markets, and better growth. They have employed more staff who are young and more technologically inclined. The research informs training policies for those affected by digitalisation, helps training providers align with industry changes, and enables companies to hire adaptable employees for growth and global expansion. A recommendation would be to still tap into the experience of less technically skilled personnel and pair them with young digitally minded youth to bridge the divide in skills transfer.
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    Financial accounting as a powerful tool to enhance NGOs' performance case study: Zoë-Life South Africa.
    (2018) Mvunabandi, Jean Damascene.; Lathleiff, Charmaine.
    Many non-governmental organisations (NGOs) in South Africa and elsewhere do not follow the International Financial Reporting Standards (IFRS) for Small and Medium-sized Entities (SMEs). There is thus no standardised process in their financial and accounting practices and preparations for financial statements cannot be compared across different NGOs. This has funding implications as organisations that do not comply with donors’ financial reporting requirements find it difficult to access financial support. However, it is not clear how the IFRS for SMEs can be used to enhance their performance. While many studies have been conducted on the use of the IFRSs among for-profit organisations, there is a paucity of such research in relation to the NGO sector. This study investigated the use of financial accounting in enhancing NGOs’ performance. Drawing on the literature in this field, a case study of a large NGO, Zoë-Life based in Durban, in KwaZulu-Natal, South Africa was conducted. The financial accounting system used by this organisation was examined in order to identify its strengths and weaknesses and offer recommendations for improvement. A qualitative approach was adopted and semi-structured interviews were conducted with 24 purposively selected respondents to capture their feelings, thoughts, and attitudes on the financial accounting system at Zoë-Life South Africa. Employees involved in accounting and finance, and projects/programmes and management were targeted. The data gathered by means of interviews were supplemented by a review of internal organisational documents. Thematic content and transcript analysis were employed to analyse the data. This study found that despite adopting accounting and financial policy and procedures, Zoë- Life finds it difficult to maximise its financial performance due to two major limitations, namely, failure to fully comply with IFRS for SMEs in South Africa, and a lack of financial support from the government. It is therefore recommended that Zoë-Life-South Africa employ qualified accountants and fully adopt the IFRS for SMEs. This would improve performance, authenticity, and accountability and ensure that the organisation complies with both donors and government’s requirements in order to secure sustained financing and promote the country’s development agenda. The study also recommends that Zoë-Life-South Africa procures the services of recognised audit firms in order to boost donor confidence. Finally, recommendations are made for further research.
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    Dynamics of capacity constraints in managing throughput quality at honours level: University of KwaZulu-Natal.
    (2015) Nkondo, Mbonya.; Mbhele, Thokozani Patmond.
    ABSTRACT The throughput quality of Honours degree students seems to be hampered by a number of factors arising from institutional capacity constraints, whose dynamics have had an impact on the throughput quality of Honours degree students at the University of KwaZulu-Natal (UKZN). The aim/purpose of this study was to identify the capacity constraints that hinder these students from achieving high levels of academic performance within their respective Honours degrees. The theory of constraints (TOC) was used as an investigative tool for identifying ways in which these constraints could be alleviated from the system at UKZN. The academic practical importance is evident in the fact that it contributes a wealth of knowledge regarding student experience in a university, which can be modelled with other respective institutions. The results should assist UKZN in identifying and alleviating the various factors that impede Honours students from achieving high levels of academic performance. A survey of male and female Honours students (aged 15 to 33 and above) found that technological systems at UKZN do not often operate at high speeds. This study adopted a unique approach by involving the Honours students in research that has a direct impact on their institution of education. The results provide support for the conceptual framework in that Honours students face institutional resource challenges as they pursue their Honours degree. The major findings of this study were tied in the funding and budget shortfalls of the university and the lack of capacity in accommodation. This study has contributed to the University of KwaZulu-Natal and other universities because it has identified what honours students experience as resource constraints at their university. UKZN is not an isolated case because other universities around the country, as well as globally, face similar resource challenges.
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    A skills audit of selected Pietermaritzburg Small Medium Enterprise (SME) owner-managers: a critical assessment.
    (2016) Mlambo, Cynthia.; Fields, Ziska.
    ABSTRACT Small Medium Enterprises (SMEs) are important contributors to the South African economy and are drivers for reducing unemployment, especially when the formal sector continues to shed jobs. However, for SMEs to be successful, sustainable and to grow, they need to operate efficiently and productively in order for them to achieve a maximum contribution to national as well as provincial economies. Most studies have shown that, on average, 50% of the small businesses that are started eventually fail in two years of being established. The high failure rate of Small Medium Enterprises (SMEs) has been blamed among other things on the lack of managers’ skilfulness. A study that was conducted by the World Bank (2012) revealed that 82% of start-ups fail within the first two years, not only because of the external factors such as economic conditions, but rather due to a lack of technical and managerial expertise. This situation is also true in South Africa as the failure rate of SMEs is between 70 to 80% and most of these failures are caused by lack of managerial and entrepreneurial skills that are vital for Small Medium Enterprise development. The motivation to this research study was to conduct a skills audit for ownermanagers of some established Small Medium Enterprises (SMEs) in Pietermaritzburg. The targeted population was owner-managers of selected SMEs in Pietermaritzburg who were registered members of the Pietermaritzburg Chamber of Business (PCB). A non-probability sampling technique incorporating census sampling and snowballing was adopted for the purposes of this research. Due to a low response rate, a switch from census sampling to snowball-sampling technique was made. This study was quantitative in nature and primary information was obtained through the use of questionnaires. The questionnaires were pilot tested before the actual data collection to test for its validity. The computer software called Statistical Package Sciences (SPSS) Version 22 was used for data analysis. The results indicated that most owner-managers had more communication competency compared to the other skills (accounting, finance and bookkeeping, management, marketing and technological skills). Even though most owner-managers agreed that they were competent in one way or the other, the results of this study also showed that most Pietermaritzburg owner-managers commented that poor management of finance is one of the most common causes of business failure. Poor general management was highlighted as the second most common cause for businesses to fail in this study, thereby reflecting that most Pietermaritzburg ownermanagers agreed that poor management of businesses is causing most business failures. The results of this study could help prevent future business failure rates by adding information to the existing body of knowledge. Recommendations on steps to match the available skills to the required skills can help government, educational institutes and businesses to provide improved and appropriate training and development to owner-managers of SMEs to bridge the skills gaps that are prevalent. These recommendations included that sole proprietors and partners need training in accounting and finance management skills as they showed a considerable lack of competency. Pietermaritzburg owner-managers were also advised to make use of inexpensive ways of marketing like the use of social media platforms, exhibitions and networking. It was also recommended to Pietermaritzburg owner-managers to apply appropriate technologies in their businesses to enhance the growth of their enterprises. A recommendation was made to all SME owner-managers in Pietermaritzburg to make use of government initiatives that are available to support small businesses. Organisations like Small Enterprise Development Agency (Seda) and the Department of Trade (DTI) are also available to provide support to small businesses in every sector. From literature reviewed and the findings of this research study, the advice was given to owner-managers to constantly develop their management skills through training in order for them to remain abreast of the ever-changing business environment that would require a different way of doing things.
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    Exploring the implementation of knowledge management at a contact centre in Durban.
    (2016) Chetty, Renitha.; Proches, Cecile Naomi Gerwel.
    ABSTRACT The knowledge management concept was introduced to the Contact Centre approximately eight years ago, therefore the study focused on the implementation of the knowledge management concept at SARS in Durban. The aim of the study was to understand the perception of knowledge management; the benefits and challenges of knowledge management, as well as the role that the leadership team played in the implementation of knowledge management. The research methodology chosen for the study was of a qualitative nature. This research methodology allowed for an interpretative approach that obtained an in-depth understanding of the implementation of the knowledge management concept. Data was obtained using semi-structured interviews conducted on a total of 20 respondents comprising of Management and Staff from the Contact Centre at SARS who had used the system for approximately eight years. Some of the common themes that emerged were quality, service delivery, customer service and communication. The study confirmed that the knowledge management concept was indeed implemented and sustained successfully, with minor improvement requirements. The research findings indicated that there was a positive perception towards how knowledge management was implemented and that there was an understanding with both leaders and staff that such a system is beneficial to the organisation. Some of the key findings noted were training and development, service delivery, customer service, technology, communication and the role of leaders. Some of the key recommendations indicated that learning styles need to be addressed since people learn and absorb knowledge differently. Social media management as a process enhancement could be implemented to improve service delivery and the taxpayer experience. Future research should focus on implementing the knowledge management concept in other divisions within SARS.
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    Factors affecting the roll-out of penetrative broadband delivery in KwaZulu-Natal.
    (2016) Manilall, Santosh.; Mutambara, Emmanuel.
    Abstract The roll-out of broadband infrastructure in countries across the globe is crucial to their economic, scientific goals, and social requirements. It has the ability to uplift lives by providing Information Communication Technology (ICT) skills for employment and it can also help improve access to online education, e-learning. Investments in broadband are increasing as policymakers believe that broadband may lead to job creation and economic competitiveness. The broadband divide in South Africa and other developing countries is of concern as broadband service is inhibited by numerous factors. Broadband macro-level access can be assessed according to penetration rates, broadband coverage, connection types, user demographics, and lastly high-level broadband policy development. The purpose of this study was to establish the factors affecting the roll-out of penetrative broadband delivery in KwaZulu-Natal (KZN), particularly with regard to fixed lines. The research employed a qualitative methodology. Purposive sampling was used to select six people from a total population of 250 and interviews were used to gather primary data for this study. Research findings revealed that Government needs to take the lead role if broadband penetration is to be rolled out in non-lucrative areas, for example rural KZN and non-affluent residential areas. The formation of partnerships amongst key role players such as other telecommunications companies, communities, and Government could assist with addressing the challenges and constraints associated with rolling out penetrative broadband services. Despite the progress that appears to be possible and is shown by other African countries such as Kenya, Uganda and Burundi, KZN appears not to be serious about rolling out penetrative fixed line broadband. A coordinated inter-governmental collaborative approach amongst key stakeholders on broadband penetration initiatives is required to develop a high speed communications infrastructure for all the country’s citizens. Similar studies of this nature could be conducted in other provinces of South Africa for a more balanced and general view of the state of penetrative broadband in the country.
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    Exploring the role of emotional Intelligence in the customer service industry.
    (2016) Sayed, Zahir.; Gerwel Proches, Cecile.
    ABSTRACT The customer service industry is a dynamic environment and serves as the face of an organisation. The purpose of this study was to explore the role of emotional intelligence in a revenue services office within the Public Sector in Durban, South Africa. In noting the significance that emotional intelligence has on service delivery, continued research was important to ascertain the role that emotional intelligence had in the customer service environment. Generally, a satisfied customer maintains loyalty and reciprocates with positive and constructive feedback. The motivation for this study was a scarcity of contemporary literature specifically on emotional intelligence within the customer service industry in South Africa. The purpose of this study was to explore the role of emotional intelligence and determine its importance to the customer service industry and during a customer service engagement. A qualitative research method with purposive sampling was employed and included management and employees from the branch operations division of the company under study. Interviews were conducted with fifteen participants in order to gain insight and understanding of their perceptions of emotional intelligence and the significance it plays in the customer service environment. The collected data was analysed using thematic analysis. The key findings indicated that both employees and managers understood the concepts of emotional intelligence concepts and provided a favourable indication that emotional intelligence has a significant role within the customer service environment. Another key finding revealed that emotional intelligence plays a significant part within the leadership of the customer service environment. The findings of this study established that emotional intelligence is essential for the customer and service employees in the customer service environment and provides the service employees with the ability to understand and reason with the emotions that arise and exist in the service engagement. The recommendation is that the leadership in the service environment should provide regular training on emotional intelligence, enabling service employees to be better equipped to deal with various types of customers and for the leadership in the service environment to manage their subordinates in an effective manner. The implications of this study can improve the emotional intelligence of service employees within the customer service industry and promote further research on this topic in South Africa.
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    The relationship between the psychological contract and retention of staff in the banking sector in South Africa.
    (2012) Dhanpat, Nelesh.; Brijball Parumasur, Sanjana.
    ABSTRACT South African organisations are under a great deal of pressure to retain their available talent. Many industries have put in place talent management strategies to develop and retain staff, some of which remains unsuccessful. Furthermore, various factors such as the changing labour market, organisational transformation and the unstable global economic climate have affected the financial stability of organisations. The instability faced by organisations has ruptured relations of their employees causing distress and hence, resulting in employees seeking alternative employment. Thus, it is imperative to understand the employer-employee relationship under the terms and conditions of the psychological contract. The study focuses on establishing a relationship between the psychological contract and retention of staff in a banking institution in South Africa. The study was undertaken in Gauteng, South Africa, and was conducted within the retail IT department of a banking institution with a staff complement of 1400 staff. A sample of 304 professionals was drawn across using non-probability sampling technique. Data was collected using a questionnaire, the validity and reliability of which were determined by using Factor Analysis and Cronbach‟s Alpha Coefficient respectively. Data was analysed using descriptive and inferential statistics. The study established that there is a significant relationship between employees‟ expectations of their organisation and their importance of having these expectations met. The study established that there is a significant and direct relationship between the organisation‟s expectations of the employee and the importance of employees meeting those expectations. Various other findings relating to the dimensions of the psychological contract and the dimensions of employment information (career status, intention to seek alternative employment, employee commitment, job involvement, organisational support, job satisfaction, values and importance of work) were assessed and generated significant findings. Based on the results of the study, a model reflecting recommendations for managing the psychological contract and the employment information are presented, which when implemented, have the potential to enhance employee retention.
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    Implementing the principles of responsible management education within the curriculum of the Graduate School of Business and Leadership (GSB&L).
    (2017) Mokoqama, Malebo Miranda.; Fields, Ziska.
    ABSTRACT There is an urgency for educational institutions to contribute to solving the world’s social, economic and environmental problems. Solutions to these global problems are not directed at multinational corporations only but also on educational institutions such as business schools. Curriculums in business schools are questioned in terms of the relevance and practical application of what students learn to real life scenarios. Hence, business schools have a responsibility to promote and encourage responsible management education within their curriculum and learning experience. This allows business schools to produce graduates who will become responsible leaders; who will have a lasting impact in businesses and in the society at large. In addition, business schools face the rising pressure to promote responsible management education through initiatives such as Principals of Responsible Management Education (PRME). There are over 600 business schools across the world that are part of PRME. Nevertheless, the Graduate School of Business and Leadership (GSB & L) at the University of KwaZulu-Natal (UKZN), is not part of PRME. This indicates the need to enhance responsible management education by applying the PRME principles within the GSB & L curriculum. A mixed methods approach was used through interviews and questionnaires to ascertain the perceptions of the students as well as staff members, regarding responsible management education and the implementation of a PRME within the GSB & L curriculum. Stratified sampling technique was used to collect quantitative data and to collect qualitative data, convenience sampling was used. Findings revealed that the majority of the students agreed that PRME should be included in the curriculum at the GSB & L. The study shows that PRME would benefit the GSB & L and the students as it creates greater awareness of sustainability issues and leadership requirements to lead an organisation responsibly and sustainably. The qualitative data was analysed using thematic analysis and the quantitative data was analysed statistician using Statistical Programme for Social Science SPSS software. In conclusion, there is still room for improvement in responsible management education at the GSB & L in UKZN. It is therefore recommended that business schools in general, and GSB & L specifically, should re-evaluate their curriculums and pedagogies by being more sustainable in research, teaching, and content. Key terms: PRME, Curriculum, Sustainability, Education, Responsible Management
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    An analysis of information technology risks and governance disclosure: evidence from the top 40 JSE listed companies.
    (2022) Nyagope, Taurayi Stephen.; Rajaram, Rajendra.; Oloyede, Obagbuwa.
    The study analysed the extent to which information technology risks and governance is disclosed by top 40 JSE-listed companies in their 2021 integrated reports as part of the risk governance practices. It also conducted a review to identify similarities and differences between King IV and other international standards such as ISO 27002, 38500, COBIT 5, SOX, and ISA 315 on IT governance and risk disclosure requirements. The results revealed that 32 out of the top 40 JSE-listed companies (80%) fully complied with King IV and other international standards on the disclosure of their IT governance and risk management in the integrated and corporate governance reports. The results further revealed that 8 out of the top 40 JSE-listed companies (20%) partially complied with King IV on disclosure of IT governance and risk management. Furthermore, the results indicated that King IV and other international standards were similar on 19 out 24 (79%) of the IT governance and risk management disclosure requirements and differed on 5 out of 24 (21%) requirements. The study confirmed the extent of IT and risk governance disclosure of the selected companies and determined areas of similarities and differences. The study adds to the debate on King IV disclosure requirements with regards to IT governance and risk management by public companies in corporate reporting and further adds to the debate on stakeholder theory.
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    Tone management examination in the CEO statements of the top 40 JSE Listed companies.
    (2022) Mlawu, Lonwabo.; Matenda, Frank Ranganai.; Sibanda, Mabutho.
    The business sector has recently been rocked by several accounting scandals. Unfortunately, South Africa has not been immune to this trend of fraudulent financial reporting, and investors have suffered financial losses when these businesses eventually fail, this is why particular attention is now on the tactics used by company leaders in the narrative disclosures. This study examined tone management in the Chief Executive Officer (CEO) statements using the JSE's top 40 businesses. The primary objectives were to analyse the impact of financial performance on the normal tone of CEO statements and to investigate the influence of abnormal accruals on the abnormal tone used in CEO statements. The study used quantile regression analysis and a generalised linear regression model to analyse the impact of financial performance on normal tone and to examine the influence of abnormal accruals on abnormal tone. CEO statements from the JSE Top 40 public businesses were examined using content analysis. Findings show a positive impact of financial performance on the normal tone of CEO statements. This indicates that financial performance and normal tone move in the same direction, as financial performance improves, a positive tone in CEO statements also increases. This further means that moderately and extremely profitable companies use a more positive tone. Results also show a negative influence of anomalous accruals on irregular tone. Meaning that anomalous accruals and irregular tone move in different directions, when abnormal accruals increase, abnormal tone decreases. Additionally, this suggests that abnormal accruals and abnormal tone do not co-occur and that companies with abnormal accruals do not conceal them using abnormal tone. It is recommended that annual financial statements users should carefully scrutinise the tone used in CEO statements, to identify whether or not it is aimed at concealing poor performance or motivated by good performance. The amount of flexibility and judgment given to preparers of financial statements should be reduced to lessen the use of earnings management practices. The study contributes to the conversation about the company's financial reporting methods applied by public businesses listed in the JSE as well as the discussions around earnings management practices.
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    The role of emotional intelligence in business rescue in South Africa.
    (2022) Maharaj, Yurashka Rajen.; Doorasamy, Mishelle.
    Existing literature highlights a positive correlation between leadership performance and emotional intelligence (EQ). EQ is a person’s ability to understand their emotions, act on their intentions and make decisions on important matters. A business rescue practitioner (BRP) plays a fundamental role in rescue proceedings, having to develop a business rescue plan and turnaround the affairs of the financially distressed company within a defined space of time. Therefore, it is key for a powerful BRP to be appointed to increase the likelihood of the business rescue case being a success. Due to the low success rate of business rescue in South Africa, it is questionable whether the EQ of a BRP is considered during an appointment to a business rescue case. Section 138 of the Companies Act is silent in this regard. This study focused on the EQ traits required for a BRP to be successful in South Africa. This was a quantitative study that used a closed-ended questionnaire to gather data for the study. The questionnaire was administered to 161 BRPs that are currently licensed by the Companies and Intellectual Property Commission (CIPC) to operate in South Africa and the response rate was 20%. Secondary data in the form of previous studies and findings was used to corroborate the findings of this study. The Statistical Package for the Social Sciences (SPSS) was used to analyse the data that was derived from the questionnaire. Results of the questionnaire revealed that the EQ of the BRP is not considered upon appointment. Moreover, the respondents agreed that the BRP takes on the role of a leader, having to make decisions and resolve conflicts. Their tasks include collaboration with stakeholders, dealing with setbacks and adapting to these accordingly. The findings showed that the respondents of the questionnaire were in agreement that an effective BRP should display self-awareness, self-regulation, motivation, social skills and empathy in their tasks. This study developed a framework of questions that can be used by courts of law to assess the EQ of a BRP upon appointment. These questions were based on the tasks of the BRP. The results indicate that EQ is an important contributing factor for a successful BRP. Therefore, it is recommended that the interview process should include questions that would assess the level of EQ of the BRP upon appointment. This will help to determine whether the BRP will be successful in rehabilitating the financially distressed company.
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    Women in the boardroom and financial performance: an analysis of JSE listed companies.
    (2022) Dockrat, Raeesa.; Marais, Alastair Malcolm.
    Despite the awareness created around gender inequality and the diverse strengths women bring to the business world, progress in gender diversity has been negligible. In South Africa, despite employment equity policies being established in 1998, after 21 years, women in post-apartheid South Africa do not occupy even close to an equal share of executive positions in business as compared to men. This study explored the association between female representation on company boards and an organisation’s financial performance. Unlike previous South African studies, this study utilized a longer period of time, from 2007 to 2016, and included a period during which gender diversity has increased in pervasiveness and there is a higher proportion of women in executive positions. The Johannesburg Stock Exchange (JSE) Top 40 listed companies were selected as the sample for this study. The data of listed companies on the JSE were sourced from the IRESS and the Bloomberg database. A dynamic linear regression model with generalized method of moments (GMM) estimation was used to conduct a robust analysis. This study found a positive and statistically significant relationship between the accounting based financial measures (return on assets and return on equity) as well as the market-based performance measure (Tobin’s Q) and board gender diversity, measured as the proportion of women on the board of directors. This implies that firms with a well gender-diversified board perform better financially. The study contributes to existing literature on whether achieving gender diversity at a board level does in fact add significant benefit to shareholders wealth and a firms’ bottom line. It influences an important policy debate and will be of interest to academics and stakeholders including directors, investors, regulators and women’s rights advocates.
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    A comparative analysis of impression management in chairman's statement amongst profitable and unprofitable JSE-listed companies during Covid-19 pandemic.
    (2022) Dhludhlu, Nokuthula Rejoice.; Phesa, Masibulele.; Sibanda, Mabutho.
    The study examined whether profitable and less profitable Top 100 Johannesburg Stock Exchange (JSE) listed companies used impression management during the Coronavirus (COVID-19) pandemic through textual characteristics in the chairperson's statement. The chairperson's statement is one of the most frequently read and highly rated narrative disclosure statements in the integrated report (IR). Quantitative content analysis was used to analyse the chairperson's statements of the Top 100 JSE-listed companies. The profitable and less profitable companies were evaluated using six textual characteristics, namely the length of the chairperson's statement, the use of passive voice, the use of personal references, the use of quantitative references, the use of future references, and the readability score. The study found that both profitable and less profitable top 100 JSE-listed companies used impression management in the chairperson's statement during the pandemic. Moreover, both groups used the passive voice as well as future, personal, and quantitative references in the chairperson's statement, even during the COVID-19 pandemic. There was no significant difference in readlability, quantitative references, passive voice, personal references, length, and future references. The results are contrary to previous research that indicates that impression management is used less during a crisis than during normal economic conditions. The study shows that the chairperson's statements are used by management as a form of attribution, which is a self-serving bias that could lead to the misallocation of capital by investors. The study adds to the debate on the use of impression management in corporate reporting during the crisis and adds to the debate on attribution theory.
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    Accounting and finance professionals’ perception on the current state of the accountancy profession in South Africa.
    (2022) Mdhluli, Sthandiwe Charity Kholiwe.; Mkhize, Msizi Vitalis.
    Background: Accountants, auditors, and other finance professionals have traditionally been well respected and held in high regard by the public. They are regarded as financial reporting overseers because they are responsible for ensuring that organisations follow relevant regulations and financial laws. Globally, accounting and finance professions have been tarnished by scandals involving intentional manipulation of financial information. The professional ethics of finance professionals are under scrutiny by the concerned public at large. The importance of ethics to accounting professionals stems from the need to make ethical decisions on a regular basis. This study is informed by the repercussions of these scandals and how they have influenced the public view of the profession. Purpose and method: The study investigates how South African accounting and finance professionals perceive their ethical knowledge, compatriots’ ethical responsibility and the role of the professional bodies in maintaining ethical responsibility. The study adopted a quantitative approach using systematic sampling. The population of the study comprises 165 accounting and finance professionals at government, corporate institutions and audit firms. An anonymous online questionnaire was the instrument used for the collection of data. Main Finding: The study found that the majority of accountants and finance professionals agree in general that they perceive themselves to have a strong knowledge of ethics. They also perceive their fellow accounting and finance professionals to be ethically responsible. It also found that being a member of professional accounting bodies also influences on the ethical behaviour and professional conduct of accounting and finance professionals. The majority of accountants and finance professionals agree in general that they face a considerable amount of pressure to compromise on ethics Conclusion: The current level of ethical knowledge of accounting and finance professionals must be maintained and improved upon via training programmes such as the continuous professional development programme. Improved knowledge of ethics can reduce perceived pressures to compromise on ethics among accounting and finance professionals. Based on this contribution, this study further concluded that accounting and finance professionals should improve their ethical knowledge in order to reduce their perceived pressures to compromise on ethics.
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    Markets' reaction to financial restatements of the Top 40 JSE listed companies.
    (2022) Jwara, Nomthandazo Consolatrix.; Mkhize, Msizi Vitalis.; Nxumalo, Bhekikhaya Henry.
    There has been a rapid growth of financial restatements. This concerns the investors about the integrity and reliability of the entity’s financial reporting environment and restatements negatively affecting market reactions. Numerous listed companies are restating their financial statements due to inaccurate or misleading information in the previously published financial reports. JSE requires listed firms to correct and amend incomplete or misleading information. A survey on the market reaction around announcements of financial restatements of JSE companies has been a concern and interest to investors, management, and any other concerned parties. As a result, the aim was to examine the causes of financial restatements of the listed top 40 companies in South Africa and establish the markets’ reaction. The study involved the top 40 companies listed on the JSE from 2007 to 2019. The study collected secondary data and the population of thirty-two events was pulled from the JSE SENS. A sample size equaled the entire population of thirty-two events. The window period included 10 days before the announcements, the day of the announcement, and 10 days after the announcement. The IBM SPSS Statistics 27, the statistics software, was used to analyse data. The results indicated a total of thirty-two restatements over a period of thirteen years. The year 2019 was the period that reported the most restatements. Causes of restatements were found to be accounting errors, adoption of the new standard, accounting irregularities, and change in accounting policy. A substantial number of restatements were due to accounting errors. A majority of companies experienced growth in share price on the 10th day after the announcement. Nonetheless, when all days within the window period were included in the analyses, the overall calculation indicated that companies experienced an average decline of - 7.55% in the share price after the announcement. The empirical findings confirm that markets react negatively to the restatements since a significant number of companies exhibited an average decline in share price after the announcement.