Abstract
South Africa’s private sector and the accountancy profession has been marred by a series of recent corporate failures and scandals since the collapse of LeisureNet. In 2017, South Africa recorded one of the largest cases of corporate fraud ever uncovered in the history of the continent. The corporate scandals included fraud related write offs by Steinhoff that involved the overstatement and misrepresentation of profits (Gusto Partners, 2023). In 2018, the VBS bank established by the Venda Homeland Government collapsed due to fraudulent misrepresentations inside the audited financial statements of the mutual bank for the year ending 31 March 2017. A similar corporate scandal occurred once again late in 2019 when Tongaat Hulett laid criminal charges against their former executives after the forensic investigation by PWC revealed that the senior executives at the Kwa-Zulu Natal – based sugar producer participated in the overstatement of the company’s profits (Tongaat Hulett, 2022).
The objectives of the study involve investigating the role that accounting regulations play in preventing corporate failure in South Africa by the interviewing of selected academics who were accounting experts and knowledgeable regarding accounting regulation. In order to achieve this objective, the questions that were posed in the Introduction were used as open-ended questions for the interviewing of the selected sample of respondents or participants in order to get their perspectives on the role of accounting regulations in preventing corporate failure in South Africa. A qualitative methodological approach based on thematic analysis was used.
The questionnaire (Appendix 1) serves as a guide to the conducting of the interviews. The researcher was guided by an interview schedule, which detailed the date and time of the research interviews which were conducted virtually on MS Teams. The details of the questions are provided in the appendix. 10 open ended questions were posed during the interviews, each interview took between 30 minutes to an hour which was reliant on the discussions with the respondents or participants, as majority of the respondents spent most of the time elaborating on the reasons for their perspectives using their experiences and knowledge during the interviews. The research questions assisted in confirming the themes regarding the adequacy of current regulatory provisions in preventing corporate failure, which emerged during the thematic analysis of the results in the study.