Research Publications (Accounting and Informatics)
Permanent URI for this collectionhttp://ir-dev.dut.ac.za/handle/10321/212
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Item Dynamic panel investigation of the determinants of South African commercial banks’ operational efficiency(LLC CPC Business Perspectives, 2022-11-02) Msomi, Thabiso Sthembiso; Olarewaju, Odunayo MagretLike any other business, commercial banks are greatly affected by the micro and macro-environment that operate in, no matter how large they are. Capital adequacy ratio, credit risk, money supply, inflation, the exchange rate, and the national gross domestic product have been noted to be the key determinants of bank operational efficiency. This research study looked at the operational efficiency of four large South African banks, namely, Standard Bank, Absa, Nedbank, and First National Bank. A quantitative, descriptive, correlation design was employed, and the System-Generalized Method of Moments (SYS-GMM) techniques were used and revealed that operational efficiency was positively correlated with capital adequacy ratio, credit risk, inflation, and exchange rate, and negatively correlated with profitability, money supply and GDP. SYS-GMM estimates show that capital adequacy ratio, credit risk, inflation and exchange rate positively influenced operational efficiency, while profitability, money supply (M3) and GDP had a negative influence. Thus, it is concluded that bank management should decrease administrative costs, evaluate customers’ creditworthiness before issuing loans, raise bank size as operational conditions require, boost intermediation, and anticipate inflation to operate more efficiently.Item Factors affecting the profitability of reinsurance companies in sub-Saharan Africa : evidence from dynamic panel analysis(Informa UK Limited, 2022-12-31) Olarewaju, Odunayo Magret; Msomi, Thabiso SthembisoThis study, which analysed the profitability of 42 reinsurers in Sub-Saharan Africa from 1991 to 2020, revealed that various factors such as gross domestic product, competition (HHI), premium growth, investment performance, underwriting risk, and operational efficiency affect the profitability in these companies. This study is quantitative and dynamic using system-generalised method of moments to analyse the data. The study discovered that reinsurers should broaden their services to remain highly competitive and boost their premium growth such that their profitability is sustained. Also, there should be a separate department of qualified professionals overseeing the adequate management of risk before sealing ceding agreement with insurers.Item Intellectual capital and financial performance of South African development community's general insurance companies(Elsevier BV, 2021-04) Olarewaju, Odunayo Magret; Msomi, Thabiso SthembisoThe effect of intellectual capital on financial performance was investigated in this paper for the period 2008 to 2019. A total of 696 observations were generated from data collected from 56 general insurance companies in 12 years. The Value Added Intelligent Coefficient Model was used and data was analysed using both static (two stage least square, fixed and random effect) and dynamic panel regression analysis (two step system generalised method of moments). The findings showed a significant and direct relationship between lagged return on assets, intellectual capital and financial performance of insurers in the South African Development Community. Out of the components of intellectual capital, human capital and structural capital are significantly and directly related with return on assets while capital employed is inversely and insignificantly related with return on assets. The control variables-underwriting risk, insurer size and leverage are all inversely and significantly affecting return on assets. Thus, a U-shape relationship exists between intellectual capital and financial performance in general insurance companies in the South African Development Community. Thus, the policy makers-cum-insurers' managers should maximise their intellectual capital as this creates competitive advantage that leads to financial performance drive and wealth generation. The Model used in this study is an important model decision-makers can use to assimilate intellectual capital in their decision-making procedures. This will inadvertently permit insurers to scale themselves according to the intellectual capital efficiencies and advance in strategies that will boost their company's financial performance.Item Nexus of loan re-payment plans, interest on loans and the sustainability of small and medium enterprises in South Africa(Durban University of Technology, 2022) Msomi, Thabiso Sthembiso; Olarewaju, Odunayo MagretThis paper examined the influences of interest on loans and loan re-payment plans on the sustainability of small and medium enterprises (SMEs) in South Africa. A quantitative research design that adheres to the positivist paradigm was utilized for this study's methodology. The study targeted 103 SMEs operating in KwaZulu-Natal, South Africa using purposive sampling. A total of 103 surveys were administered, representing a participation rate of 100 percent. The analysis demonstrated a positive relationship between interest on loans and the SMEs’ sustainability and positive relationship between Loan re-payment plans and SMEs’ sustainability. The study recommended that financial institutions should examine loan re-payment plans for SMEs as necessary in order to minimize loan defaults by SMEs, and financial institutions should cut loan interest rates and the costs associated with loan approvals, which may be accomplished via automation and the utilization of online applications. Furthermore, the study suggested that financial institutions should design a flexible loan re-payment plan for SMEs that considers the nation's economic realities.Item Accounting skills and the sustainability of small and medium enterprises in South Africa(Universitatea Danubius Galati, 2021-04-01) Olarewaju, Odunayo Magret; Msomi, Thabiso SthembisoThe objective of this study is to examine the accounting skills and sustainability of small and medium-sized enterprises (SMEs). The quantitative research method was adopted for this study and the purposive sampling technique was chosen to select the participants for this study. The study collected primary data from respondents who are owners of SMEs in the retail, construction and manufacturing sectors, etc. Data was analysed using SPSS. A total of 310 research questionnaires were administered and 304 research questionnaires were returned for analysis (giving a 98% response rate). A regression analysis and Pearson’s correlation analysis were conducted. The outcome of Pearson’s correlation shows moderate correlation (r value is 0.531) between accounting skills and sustainable SMEs. There is also a significant effect of accounting skills on sustainability as revealed in p-value <0.0005. Thus, it was concluded that SME owners need more accounting training or bookkeeping awareness. This is because training will equip SME owners with the needed skills to ensure accurate recording of business transactions, which is beneficial when the need for financial assistance from banks or other financial institution arises.Item Evaluation of access to finance, market and viability of small and medium-sized enterprises in South Africa(LLC CPC Business Perspectives, 2021-03-15) Msomi, Thabiso Sthembiso; Olarewaju, Odunayo MagretAccess to finance and market has been described as a predominant challenge confronting small and medium-sized enterprises (SMEs). Hence, this paper seeks to evaluate access to finance, market access and viability of SMEs. A quantitative research method and a purposive sampling technique were used to select the participants for this study. Respondents from retail, manufacturing, construction and agricultural SMEs operating in Durban, KwaZulu-Natal, were selected to complete the structured questionnaires. 310 questionnaires were returned out of 321 distributed. The study revealed a significant effect of access to finance (absolute value 0.425) and access to market (absolute vale 0.373) on SMEs’ viability with a 5% level of significance. Thus, it was concluded that access to finance uniquely accounted for the larger proportion of the variance in the regression model. Thus, this study suggests that owners of SMEs should pay greater attention to access to finance in running their businesses, and the Government should aid SMEs to market their products and keep their businesses viable. Public loans or the government supported loans should be made available for SMEs with soften requirements in order to stimulate economic growth.