Segment reporting and trade unions in South Africa.
Loading...
Date
1997
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
During the early 1970's two trends emerged in the South African business environment. The
first trend was that the number of diversified enterprises started increasing, and the second
trend was that there was a steady increase in the activities and power of trade unions. These
two trends were considered during the evaluation of prior research on the topic of segment
reporting.
Prior research on segment reporting focused on the usefulness of segment reporting, the
problems associated with segment identification, the objections to providing segment
information, and the extent to which diversified companies disclose segment information.
Using the trends identified and the prior research, the research problem developed was as
follows: are the segment disclosures of South African listed companies sufficient to meet the
information needs of trade unions in South Africa, and if not, what additional information do
trade unions require?
The research problem was limited to listed companies as it was identified that trade unions
may experience difficulty in obtaining information which is not available to the general public.
In addressing the problem, the following three objectives were formulated:
(i) to determine if trade unions use segment information,
(ii) to determine what their requirements are in respect of segment information, and
(iii) if trade unions do not use segment information, to determine why segment information is
not used.
In order to achieve these three objectives, it was necessary to conduct a survey of trade unions
on their use of segment information. This survey was undertaken as a series of replicative case
studies with the primary data being obtained by means of interviews. Generalisations were
then made about the use that trade unions make of segment information.
The main conclusions to this research were:
(i) trade unions use segment information unless they are part of a national bargaining
forum,
(ii) trade unions consider segment information to be at least as useful as consolidated
information, and
(iii) trade unions use segment information primarily to form the basis for wage negotiations
and to assess overall company performance.
Once these conclusions had been drawn, the results were compared to results of a survey of
investment analysts in South Africa, and evaluated against proposals contained in the
International Exposure Draft (E51) on segment reporting. There were similarities between the
segment itnformation needs of trade unions and investment analysts, although the trade unions
required more information regarding employees and the remuneration of management. Trade
unions also indicated that the proposals contained in the exposure draft would be acceptable,
although the unions would require more employee information on a segment basis to be
disclosed.
Thus, the research project achieved its objectives. In addition, areas for further research
within the area of segment reporting were identified.
Description
Thesis (M.Acc.)-University of Natal, 1997.
Keywords
Theses--Accounting., Labour unions--South Africa., Financial statements--South Africa., Line of business reporting--South Africa., Disclosure in accounting--South Africa