Accountants In South Africa Research Articles

Perceptions of South African Accountants on Factors with a Role in the Adoption of Artificial Intelligence in Financial Reporting

Purpose—The objective of this study was to conduct a detailed South African study that sought to explore and analyse the views of South African accountants regarding the factors that affect the adoption of AI in financial reporting. In other words, this study aimed to understand what accountants in South Africa think about the use of AI in their field, especially concerning its integration into financial reporting practices. Three main theories underpinned the study, namely, the diffusion of innovation, technology, organisation, and environment framework, and the institutional theory. In essence, the study sought to determine the perception of South Africa’s accountants on these factors. Design/methodology/approach—This study adopted the quantitative research method and descriptive design. In this regard, positivism as a philosophy was preferred. An online survey was developed to collect information from the participants. Participants were recruited based on their affiliation with the four IFAC-recognised accounting bodies in South Africa: SAICA, SAIPA, CIMA, and ACCA. Findings—Th study found that, overall, South African accountants believe that organisational, technological, and environmental factors play a role in adopting artificial intelligence in financial reporting. Originality/value: This study contributes by enriching the understanding of South African accountants’ perceptions of the adoption of artificial intelligence in financial reporting through the lenses of the selected theories.

Aspirant South African accountants’ perceptions of the usefulness of a research project as a learning tool to develop professional competency

The current business climate has been described as being volatile, uncertain, complex, and ambiguous (VUCA). This new world paradigm requires new skill sets. Professional bodies are responding to changes created by this new-world paradigm that university graduates will enter with revised competency frameworks that focus on business, digital, relational, and decision-making acumen (SAICA 2021b) and include both professional (i.e., non-technical) and technical skills. Historically, accounting departments that trained chartered accountants focused on developing technical competencies in students and did not have a tradition of research. Accounting departments are investigating various teaching initiatives or tools to help develop non-technical skills in response to the changing work environment and to comply with the updated Competency Framework. Research projects, where students must formulate and investigate an unstructured question and present their findings, are used globally as a tool to develop professional competencies; however, there is limited application of research projects in the training of aspirant chartered accountants in South Africa. The 2020 cohort of postgraduate accounting students at a South African university provided a unique opportunity to investigate students’ perceptions of professional skills competency development through a group research project as very few had prior experience in conducting research. This study documents students’ perceptions of the use of the research project as a learning tool to develop specific professional competencies not traditionally taught and assessed. Although students found the research challenging, they believed that it supported the professional competency development required of future graduates that was not previously addressed appropriately.

Relational and decision-making skills development in South African accounting students

Employers of accounting graduates have criticised graduates’ ability to work well with others and think critically. This study investigates aspirant Chartered Accountants in South Africa (‘aspirant CA(SA)s’) perceptions of the extent to which universities should and are developing relational and decision-making (RDM) skills in accounting students. Questionnaire data from 44 aspirant CA(SA)s, employed at three offices of a large audit firm in South Africa, were obtained. The majority of participants perceive that virtually all RDM skills are developed to an intermediate or advanced level during the academic programme. However, participants also perceive that the academic programme should develop all RDM skills to a greater extent; in particular, skills relating to managing others, teamwork, relationship-building, professional scepticism, emotional intelligence and leadership, to maximise performance during the training programme. Academics may benefit from this study’s findings of perceived RDM skills deficits, and suggestions for their development, which includes collaborating with training offices.

The impact on auditors of non-compliance with laws and regulations

This article clarifies and expands on the implications of the pronouncement: Non-Compliance of Laws and Regulations (NOCLAR), on Registered Auditors and Professional Accountants in South Africa. NOCLAR was introduced to assist legislative reporting obligations and strengthen professionalism and law coherency. The study clarifies the implications the IRBA and SAICA Codes of Professionals Conduct have on Accountants and Auditors and the course of action required if, all prior equivocal guidelines fail to address an illegality. Due to the relative infancy in the application of the NOCLAR amendment in South Africa, this study adopted a qualitative research methodology by critical review and analysis of commentaries, guidelines and application of the amendment by South African Accountants, Auditors and Academics. The study found that non-adherence to the amendment results in 3 key repercussions for both company and/or the Accountant and Auditor: Reputational damage, Loss of current clientele and future business opportunities and criminal charges.

Value Creation Perceptions of Management Accountants in South Africa

The Coalition for Inclusive Capitalism launched the Embankment Project for Inclusive Capitalism (EPIC) to tackle the challenge of communicating how value is created for the stakeholders of a company. However, discord on how stakeholder value should be measured exists. Management accountants can successfully measure the value of money in their cost control function, but it remains a challenge on how they perceive the adding or creating of value in their respective roles and if their own perceived performance. The aim of this study was to obtain an understanding study of how management accountants view and navigate through this concept of value creation in general and in their organisation, how and why they engage in value-creating activities for their organisations and its stakeholders. A qualitative approach was adopted to conduct the study and the data collection technique constituted a literature review and questionnaires distributed to 30 participants. The majority of the participants believe that they are creating value for their organisations and positioned their perceived value creation into the economic value category. Some participants believe that the value they create within their organisation cannot be measured. Overall, it is recommended that possible development of tools, models or frameworks to assist management accountants in the measuring or capturing of value should be explored that is of a more subjective nature, so that it would be easier to implement and drive value creation practices in the workplace.

University accounting programmes and the development of Industry 4.0 soft skills

Orientation: The Fourth Industrial Revolution (Industry 4.0) is anticipated to have a significant impact on the future generation of professional accountants. Accordingly, current and aspirant accountants are expected to acquire and develop soft skills, which will enable them to add value as responsible business leaders and thrive within Industry 4.0. Research purpose: The overarching purpose of this study was to elicit the perceptions of entry-level chartered accountants in South Africa (CAs [SA]) on the development of soft skills during a university accounting programme, specifically those soft skills demanded by Industry 4.0. Motivation for the study: Limited research appears to exist with specific focus on the perceptions of entry-level CAs(SA) regarding the development of soft skills during a university accounting programme. Research approach/design and method: University accounting programmes accredited with the South African Institute of Chartered Accountants (SAICA) were the focus of the empirical work. A questionnaire was used to obtain the exploratory results, which yielded a response rate of 40.77%. Main findings: The quantitative results indicated that the particular accounting programme in question was perceived to have developed most of the soft skills required by Industry 4.0. Practical/managerial implications: One of the implications of this study is that the university accounting programme providers should place more emphasis on the development of soft skills, specifically those related to Industry 4.0. Contribution/value-add: The results of this research contribute to the existing body of knowledge by articulating the views of entry-level CAs(SA) on the development of Industry 4.0 soft skills.

Professional skills development during a period of practical experience: Perceptions of accounting trainees

Constant changes in the business environment require from inter alia, Chartered Accountants in South Africa (CA(SA)s) to develop professional skills alongside technical accountancy knowledge. These skills are a crucial component of well-rounded business leaders who are able to add value to an organisation. Practical experience is often suggested to be more effective in developing certain professional skills when compared to the development thereof in a university accounting degree (accounting programme). Practical experience in a firm before entry into the Chartered Accountancy profession (CA profession) is therefore investigated to explore the professional skills perceived to be developed during this period while gaining practical experience. The data was collected by means of a questionnaire distributed to entry-level CA(SA)s entering the CA profession in 2017. The results indicate that a period of practical experience is seen as effective in developing professional skills. The study also established that the size of the firm in which the practical experience is obtained does not have any influence on the development of professional skills. However, the industry in which practical experience is obtained, as well as the interrelationship between firm size and industry, does have an influence on the development of skills. This paper contributes to the debate on South African entry-level CA(SA)s’ professional skills, from the perspective of a developing country which is recognised for its pre-eminence in CA education and training.

Curriculum reduction, cognitive load and understanding of core principles

Purpose The purpose of this study is to investigate whether the recent reduction in the volume and complexity of the financial accounting curriculum, which is examinable as part of the qualification process of chartered accountants in South Africa, has resulted in improvements in students’ understanding of core accounting concepts. The reasons for the curriculum reduction are to encourage life-long learning, reduce syllabus overload and focus on core principles. Design/methodology/approach A sample of 514 students completed an assessment designed to test core concepts. Approximately half the students had been exposed to the previous, larger and more complex curriculum; the other half had only been exposed to the reduced, simpler ‘core’ curriculum. Findings Although the assessment results of the two cohorts were not significantly different, the latter cohort made significantly less conceptual errors than the former cohort, even though the latter cohort was relatively novice. This finding supports the hypothesis that the reduced curriculum assists students’ understanding of core concepts. Furthermore, it aligns with Cognitive Load Theory (CLT) in that the reduction in examinable content reduces intrinsic load within cognitive load, thereby optimising student learning, as measured by assessment results and error rates. Originality/value The findings of this study have relevance for professional accounting bodies responsible for approving curriculum; accounting and other academics interested in the consequences of curriculum reduction on student learning and researchers applying CLT across other disciplines, specifically focussed on the relationship between intrinsic load and learning efficiency.

Accounting students' experience of an improved strategy of feedback on assessment

Higher education institutions in South Africa are experiencing the effects of massification and diversification of the student body, necessitating students to take more responsibility for the management of their own learning. The education of chartered accountants in South Africa reflects this reality. Feedback on assignments and formative assessments is regarded as a key mechanism to facilitate students' development as independent learners. The practical logistics of providing one-on-one feedback to an ever-increasing number of students necessitate a concerted change in feedback practice. The goal of this article is to report on the experience of undergraduate accounting students regarding the revised and more detailed system of feedback on assignments and formative assessments that was introduced by the authors. The researchers are of the opinion that the questionnaire cannot be tested at other universities, unless the total approach to feedback is instituted and supported. The research is underpinned by the theoretical framework of self-directed learning. Pragmatism and a mixed methods methodology is the relevant research paradigm underlying this inquiry and the concurrent triangulation approach is considered appropriate to this investigation. The study found that students were of the opinion that the new form of feedback on assessment enabled them to identify typical mistakes, recognise their individual strengths and weaknesses, gain from constructive criticism and conduct regular self-assessment. The quantitative inquiry clearly showed that students were overwhelmingly satisfied and impressed with the features of the revised strategy of feedback. However, the peer-assessment feature of the strategy was not received as positively, as students expressed anxiety in assessing their peers. The study has proven that a concerted change in focus could assist in student self-assessment and self-directedness.

Cost Accounting Curriculum Related Competencies and Performance of Accountants in South Africa

Purpose - Over the years, the context of work for accounting professionals has changed dramatically. In the present time, the accounting profession has witnessed the existence of a gap between the current and desired skills in the accounting field. The study intends to review the literature on the dynamic relationship between cost accounting curriculum content and performance of accountants in South Africa. Design– The paper used a desk study review methodology where relevant empirical literature was reviewed to identify main themes and to extract knowledge gaps.Findings – It was found that studies on the competence of cost accountants are few; the existing studies are not conclusive because they found either a positive relationship, negative relation or no significant relation at all. In addition, methodological gaps and contextual gaps exist since most studies are qualitative in nature and are from developing economies while few are from South Africa. This implies that this area has not been deeply explored thus paving the way for further research. Originality/value – The paper offers a guidance on classification of competencies acquired by cost accounting graduates and identifies a knowledge gap on to which further studies can be conducted. In addition, the paper results will have practical and policy implications as far as modeling curriculum development of cost accounting education is concerned. DOI: 10.5901/mjss.2014.v5n25p108

Educating professionals – perceptions of the research–teaching nexus in accounting (a case study)

The teaching–research ‘nexus’ has been an area of historic and ongoing controversy within universities and discussions into the nexus between teaching and research continues to expand. Within the accounting discipline, where new knowledge is perceived to be located ‘outside’ the university, academics struggle to describe and evaluate their roles as teachers and researchers. This paper investigates the perceptions of accounting academics and professional accountants in South Africa with regards to the meaning of research, their role as teachers, and the nexus between teaching and research. This study suggests that the external production and application of specialised knowledge in accounting, the strong control by the profession of the accounting curriculum offered by accredited universities, and their loyalty towards the profession, obstruct the perceived research role and value of accounting academics. Accounting academics and universities are encouraged to break away from the simple categories of ‘research-teaching’ and accept the multi-faceted understanding of academic work within a professional programme, as demonstrated in the paper.

Professional accounting education programmes in South Africa and India

Purpose – The purpose of this paper is to provide a contextual analysis of the professional accounting education programmes in South Africa and India by benchmarking both programmes to the International Education Standards (IESs) of the International Federation of Accountants (IFAC). Design/methodology/approach – The research methodology is a qualitative archival approach extracting information from secondary data (Statements of Membership Obligations’ compliance questionnaires available on the IFAC web site and information from the web sites of the relevant professional accountancy bodies). Findings – With regards to the IESs, the study found that both countries comply with the standards, although important differences occur. In South Africa, most of the education takes place during the university phase; and while both countries cover the content requirements, India covers the acquisition of professional skills more formally; ethics is taught and examined in both countries; both countries require a three year training contract; both countries have a final examination but the content of the examinations are different; and South Africa requires more continuous professional development than India. These findings, when related to India's and South Africa's relative positions on certain of the Global Competitiveness Indices may indicate that India could learn from the South African accountancy education model in order to strengthen the Indian position with regards to auditing and reporting standards. Research limitations/implications – A limitation of the study is that it did not investigate the quality of the relative education programmes and it benchmarks both programmes at a single point in time. Practical implications – India could strengthen its accounting profession by implementing some of the South African aspects of its education model. South African could consider adopting the flexibility in the entry requirements in the Indian education model in order to increase the number of accountants in South Africa. These findings may also be useful to other developing countries to identify practices which could be adopted if suitable in their respective countries. Originality/value – The study is original as accountancy education programmes in India and South Africa have not been contrasted before. In view of their similar colonial background and the fact that both countries are major economic and political forces in their respective regions, the value of this study is that it provides useful and relevant information to India, South Africa and other countries with similar economic and social backgrounds.

Reluctant ally: The development of statutory regulation of the accountancy profession in South Africa, 1904–1951

Accountants in South Africa established professional organizations to protect and promote the profession in the rapidly growing business environment after the discovery of diamonds and gold in the last quarter of the nineteenth century. This article investigates the development of the statutory regulatory environment of the accounting profession, which gradually emerged alongside the profession’s own structures. The growth of the South African economy created a rising demand for professional accountants, and large numbers of accountants from Britain emigrated to South Africa (or to the former colonies under British control, which later formed the Union of South Africa in 1910). Professional regulation remained a professional concern until the 1951 Act which established the Public Accountants and Auditors Board. The article extends the existing literature on the state–profession nexus by explaining the circumstances leading to proactive intervention of the state and the intersection of the state’s public interest responsibility and the closure attempts of the profession.

The relationship between devoted study time and auditing learning approaches followed by prospective chartered accountants in South Africa

Learning approaches in accounting, distinguishing between deep, surface and strategic approaches, have been researched in several countries other than South Africa. The study reported in this article provided a South African perspective by investigating the auditing learning approaches of prospective chartered accountants in relation to time they spent studying during their final university postgraduate programme and their preparation for auditing topics examined in the first part of their professional accounting qualifying examination. The widely accepted research instrument, the Approaches and Studies Skills Inventory for Students (ASSIST), was applied. Statistical analysis revealed a preference for the strategic approach by candidates who passed the auditing question in the South African Institute of Chartered Accountants’ 2010 Qualifying Examination Part 1. The study found that those who devoted more time were more inclined to follow a strategic or deep approach, while less devoted study time resulted in a surface approach. Various areas for future research were identified.

A Consideration Of IFRS Education And Acceptance From Culturally Diverse Backgrounds: A South African Perspective

Accountancys double-entry bookkeeping system has spread throughout the world over the past 5 centuries. Within each country, local accountants have adopted accountancy practices to suit their unique environment. In the modern global business environment, this uniqueness makes cross-border financial statement comparisons difficult. A key objective of a globally acceptable set of accounting standards (such as IFRS), is to enhance such trans-national comparisons of corporate performances. However, research revealed that the influence of cultural backgrounds is a key contributing factor influencing accounting practices. It is evident that culture is a key concomitant of accounting development, including accounting education. Two globally recognized authors on the importance of culture in the work environment, Hofstede and Gray, developed cultural dimensions to gauge the cultural impact in a business environment. The primary objective of this research was to consider the impact of different cultural backgrounds, as measured by Hofstede and Gray on prospective accountants in South Africa, as an early adopter of IFRS. The results of the study suggest that culture will play an important role in accounting education and acceptance in the culturally diverse South African context.

The Tax Knowledge of South African Trainee Accountants: A Survey of the Perceptions of Training Officers in Public Practice

This empirically-based, exploratory study outlines the framework of chartered accountants' tax education and training in South Africa and focuses on training officers' perceptions of the existing tax knowledge of trainee accountants when entering into a training contract after completing their university qualification. The study identified the respondents' satisfaction with the performance by ‘entry-level’ trainee accountants of their duties. The results indicated that, although the educational background of trainee accountants was for the most part adequate, these trainee accountants were not sufficiently able to perform their duties when entering into training. The implication of this study is that the syllabus setters and educators should review the practicality of the current tax syllabi's content for the education and training of aspirant chartered accountants in South Africa.

An exploratory study of chartered accountants’ awareness and understanding of XBRL

eXtensible Business Reporting Language (XBRL) is an important new technology for the electronic communication of business and financial data and, by implication, relevant to, inter alia, chartered accountants. Because research in Australia and the USA showed unacceptably low levels of awareness and understanding of XBRL, research was conducted to determine the levels of awareness and understanding of XBRL in South Africa. The study was limited to chartered accountants. The results showed that the majority of chartered accountants in South Africa are currently unaware of XBRL and few fully understand it. In spite of these findings, the majority of respondents acknowledged the fact that it was necessary for either them or someone in their organisation to investigate the matter of XBRL in the near future.

An analysis of the current IT education offered to accounting students at South African universities

The accountancy and auditing profession operates within an environment that is changing at a rapid pace. Professional accountants need to remain relevant in this changing environment that may require them to change or adapt the services they offer to their clients. One of the key drivers of change in the environment is the advances in information and communication technologies (ICT). Accountants in South Africa are educated through four years of formal academic study and three years of practical training. By the end of the formal training, students entering the profession as trainee accountants should possess a set of critical ICT skills. However, currently there is no formal study or information available on which of the elements of this framework students are exposed to whilst studying at the different South African universities. This may result in students entering the profession without possessing some of the critical ICT skills necessary to perform their job competently.The purpose of this investigation is to determine the extent to which students currently studying accountancy at South African universities will be able to acquire the critical ICT skills to be competent in using information technology. Through this analysis, the shortcomings and strengths of current education practices followed at South African universities will be identified and discussed in order that role-players can identify strategies to improve the education offered to students.

Aspects of higher education and black chartered accountants: empirical findings

A shortage of black people in the accounting profession in South Africa is a major cause for concern. The South African Institute of Chartered Accountants set itself a target of 3 000 black chartered accountants by 2005. Currently there are only about 245. This article is based on the results of a survey among black chartered accountants in South Africa. The purpose of the article is to furnish insight into the reasons why so few blacks have chosen to study accountancy, particularly on a postgraduate level and the problems they experienced whilst studying towards the chartered accountancy qualification. The accounting profession, business, institutions of higher education and black students should work together in order to make a significant contribution towards integrating blacks into the accounting profession. (South African Journal of Higher Education: 2003 17 (1): 156-165)

Views of black trainee accountants in South Africa on matters related to a career as a chartered accountant

Against a backdrop of only 337 black chartered accountants in a total of approximately 20 000 in South Africa in 2003, the South African Institute of Chartered Accountants (SAICA) is reviewing its current transformation targets for 2005. Information was required to review the obstacles that black trainees in general and accountants in particular experience en route to qualifying. Accounting as a career was investigated from a theoretical point of view. A questionnaire was designed, which focused mainly on problems and barriers in respect of career guidance; funding and bursaries; role models in the profession; knowledge of the profession; and exposure to business. The questionnaire was distributed to all 755 black trainee accountants that were registered with SAICA. A total of 313 questionnaires were returned, representing a response rate of 41,45%. A lack of knowledge about the chartered accountancy profession and careers related to the profession was identified as one of the main reasons for the small number of blacks in the profession. Career guidance at school was stated as the main contributing factor in this regard. A lack of funding and of bursaries was stated as the second most important reason why students do not choose a career in accounting. Other important barriers identified include the limited nature of the work given to trainee accountants to do and the resulting limited work experience that they gain; a lack of black mentors in firms; racial bias on the part of supervisors; and a lack of recognition of and respect for the work completed. Black trainee accountants suggest that academic support programmes should be introduced to assist them to prepare for examinations, a forum should be established for students of Accounting in which they can interact with accounting professionals through workshops; a network group of professional black mentors in the business sector should be formed; and the advancement and retention of black members within the profession should be encouraged. Awareness programmes should be accorded a high priority in the short term.