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Faculty of Accounting and Informatics

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Subject: search.filters.subject.IFRS for SMEs

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    The impact of financial statement quality and firm characteristics on access to finance by small and medium-sized enterprises in eThekwini
    (2024) Mayendisa, Qiniso Prince; Stainbank, Lesley June; Ramsarghey, Anchal
    The South African government has established several public sector institutions that cater to small and medium-sized entities’ (SMEs) needs through the Department of Trade, Industries and Competition. These institutions, known as Business Development Service Providers, assist SMEs in running their businesses more effectively and can enhance access to finance as an alternative form of collateral in circumstances where security for a loan is required. However, most SMEs apply for finance from financial institutions. As access to finance has been identified as a major obstacle limiting the growth and survival of SMEs, the objective of this research was to investigate the impact of financial statement quality and firm characteristics on access to finance by SMEs in eThekwini using the “Applied and Received” approach. The main research objective was divided into three sub-objectives; these were to determine the forms of finance being used by SMEs, to determine the accounting frameworks being used by SMEs, and to investigate whether financial statement quality and firm characteristics affect their access to finance. To achieve these objectives, a questionnaire was administered to owners of SMEs in eThekwini. The results revealed that the main forms of finance used by the SMEs were overdraft facilities, bank loans, factoring, leasing, and hire purchase, and that the average rate of extent of access to finance is 19.10%. The findings also revealed that 4.8% of the respondents were using IFRS, 72.9% were using IFRS for SMEs, and 22.3% were using South African Statements of Generally Accepted Accounting Practice. Lastly, the findings revealed that firm age, firm size, collateral, and financial statement quality have a significant effect on access to finance by SMEs. Therefore, possession of such firm characteristics and financial statement quality are important predictors of SMEs’ successful access to finance. The Government needs to help SMEs by providing them with educational programs that will assist them in compiling and understanding their financial statements to keep them improving and surviving. Furthermore, an SME’s growth and survival also depends on its access to finance.
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    The difference between non-profit organization financial reporting practices and financial performance in relation to IFRS for SMEs and government requirements
    (Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI), 2023-08-31) Mvunabandi, Jean Damascene; Prof Said, Jamaliah
    This study explored the financial reporting practices and financial performance of non-government organizations (NGOs). A case study of a large anonymised non-profit organisation based in Durban, KwaZulu Natal-South Africa, was conducted. A qualitative approach was employed, and data was collected through semi-structured interviews with 24 purposively selected participants to capture their thoughts. Data collected through interviews were supplemented by a review of internal confidential organisational documents. Transcripts, conventional thematic and document analysis, were used to analyse data. Empirical findings revealed that the selected organisation’s financial reporting practices were not fully prepared under the International Financial Reporting Standards for small and medium enterprises (IFRS for SMEs) but differed substantially in line with different formats imposed by its external donors. Relying on empirical findings, key recommendations with a view to enabling the organisation and other similar organisations globally to meet the divergent and often conflicting with requirements of all their stakeholders without losing credibility and or compromising its principles were provided. Therefore, policymakers and other key role players should act swiftly to remedy these discrepancies. This study will guide researchers to further research on subject matter