Abstract
Despite its strategic importance to the South African economy, the banking sector in
South Africa has been plagued by failures. This is amid exposure to certain risks
relating to the adoption and use of Information Technology (IT) in banks. These
detrimental bank failures have been noted in the sector and this is despite various
frameworks meant to optimise governance, like the King IV Report, which is the
current and latest of the King reports. The King Reports provide guidelines and
makes recommendations for IT governance, as well as the obligation for entities to
explain how recommended practices are implemented in their integrated reports.
Lack of compliance with these requirements has been identified as the main reason
for bank failures, including in the African Bank case. Further, compliance levels have
been varied as reported in the extant literature, which is largely based on King III
Report.
The current study sought to assess the banks in South Africa and their compliance
with IT disclosures and narrating in their integrated reports for the 2021 financial
year, as required by King IV. Empirical analysis was undertaken using a descriptive
study based on secondary data from integrated reports of the five (5) biggest banks
by asset size and market share. Data was analysed using both content analysis and
descriptive statistical analysis. Findings showed that there was no universal
compliance with 80% compliance rate being recorded for various recommendations
contained in Principle 12 of King IV. Thus, there remains non-compliance by 20% of
studied banks with regards to various recommendations. The study recommends
that banks strive to make the requisite IT disclosures in their integrated reports,
particularly given the importance of such disclosures and related compliance.
Further, disclosure made by banks should be as material and comprehensive as
possible and not just a tick-box kind of disclosure. This would enhance the utility of
disclosures provided to stakeholders.
Keywords: Banking; King IV; Integrated Reports; IT Disclosures; Compliance; IT
Governance .