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This study investigates overtrading, which is the result of an expansion rate that is too high in relation to a particular business’s structure. It often results in cash flow problems. The phenomenon of overtrading is described in a case study on Profurn. In this study, a ratio was developed that can be used to identify companies in an overtrading position. Selected variables were tested by means of the Kruskal Wallis test in order to pinpoint variables that can discriminate successfully between companies that are overtrading and ones that are not. Overtrading occurred in 15.5% of the company years of listed South African companies between September 1989 and December 2005. Of the 35 variables tested, 31 were found to be able to discriminate statistically between company years in which overtrading occurred as opposed to ones in which it did not occur. These variables can therefore be used to profile companies that overtrade.

In this article, modifications are suggested for the current format of the cash flow statement, which is prescribed by AC 118, in order to address ambiguities and improve comparability. This redefinition of activities, together with the alteration of the layout, leads to a better explanation of the cash‐generating function of an enterprise. The authors argue that the separation of the cash flow for the maintenance of the existing resource base and the cash flow for the expansion thereof, is essential information in a model for the prediction of the future cash flow generation of a company. The resultant increase in the accessibility, reliability and utility of cash flow reporting should enhance users’ economic decision making and liberalise financial information. The modifications proposed in the article can therefore assist standard setters to improve financial reporting.

This article assesses the state of cash flow reporting by listed South African industrial companies in order to evaluate whether the users of financial statements can accept them as being reliable and use them as a tool to compare the operating performance of various companies. As the cash flow statement has been in use since 1989, it was envisaged that compliance would be high. However, it was found that there are several companies that deviate from some of the requirements of AC 118 regarding cash flow statements.

In financial analysis, forecasting often involves regressing one time series variable on another. However, to ensure that the models are correctly specified, one needs to first test for stationarity, co‐integration and causality. In testing for causality, the variables should be stationary. If non‐stationary, one can estimate the model in difference form, unless the variables are co‐integrated. This article determines whether cash flow and earnings variables are stationary, and which variable causes the other, using econometric analysis. In most cases, cash flow variables are found to cause earnings variables. This is so when the models are estimated in levels. However, when estimated in first differences, the causal relationship tends to be reversed such that earnings cause cash flows. Further study is recommended, whereby panel data could be used to improve the power of the tests.

A relatively simple way to analyse a company’s financial status is to examine the positive or negative signs of its cash flow patterns and to link certain characteristics to selected cash flow patterns. In this article, the frequencies of cash flow patterns in South African listed industrial companies are examined for a single financial period, as well as for three different cumulative periods, ending in 1993, 1996 and 2002 respectively. Mature companies, i.e. those with positive cash flow from operating activities, negative cash flow from investing activities and negative cash flow from financing activities, were identified as the most frequently occurring pattern during the selected periods. The study shows that the mature companies had the highest median amongst the more regular cash flow patterns, for the net profit percentage, for the cash flow from operating activities before the payment of dividends as a percentage of sales and for dividend payout. The study also reveals that companies in their growth phase had the highest medians for investment outflow, for sales growth and growth in total assets, for accounts payable and inventories. Start‐up companies had the highest medians for inflow from financing activities and for total debt to total assets.

This chapter presents the cases of two State-owned companies in Uruguay: ANTEL (telephone company) and ANCAP (oil company). Since 2008, these firms have been preparing value-added statements (VAS), a report that shows how value is distributed to stakeholders.

Qualitative methods, particularly interviews, and analysis of documents.

VAS reporting became a highly accepted practice in both firms. VAS reports help to better explain the impact of public policies implemented through these companies – a situation that seldom happens in a private firm. This accounting practice is also consistent with the political decision of increasing accountability in State-owned firms.

Since it is a case study research, we cannot generalize conclusions. This study has focused on the beginnings of this experience; further research may adopt a longitudinal approach by exploring how this accounting practice evolves over time.

These reports are not much read by external audiences (e.g., members of parliaments, public officials, journalists, NGOs). In a similar vein, these reports have not been used much for internal managerial purposes. The use of VAS reports for both public policy and management purposes remain untapped opportunities to explore.

These companies consider value distribution as a core commitment in their CSR policies and have consequently decided to make that value distribution explicit in a reporting model.

There are few studies about VAS reporting in Latin America.

Empirical accounting research frequently makes use of data sets with a time‐series and a cross‐sectional dimension ‐ a panel of data. The literature review indicates that South African researchers infrequently allow for heterogeneity between firms when using panel data and the empirical example shows that regression results that allow for firm heterogeneity are materially different from regression results that assume homogeneity among firms. The econometric analysis of panel data has advanced significantly in recent years and accounting researchers should benefit from those improvements.

The purpose of this paper is to investigate the relationship of financial ratios and non-financial factors of successful and failed corporations in the USA. Specifically, the authors provide evidence on whether financial ratios and non-financial factors can be jointly included as indicators to improve the predictive capacity of organisational success or failure in different countries and sectors.

The paper utilises a mixed method exploratory case study focussing on listed corporations in the US and Australian manufacturing, agriculture, finance and property sectors.

The financial ratio findings demonstrate that (with the exception of the failed Australian manufacturing sector) the integrated multi-measure (IMM) ratio approach consistently provides a higher classification rate for the failed and successful groups than those provided by an individual measure. In all cases the IMM method scored higher for US companies (with the exception of the failed Australian property sector). The findings also show that irrespective of the country location or sector, non-financial factors such as board composition and managements’ involvement in organisational strategy impact on a corporation’s success or failure.

The findings reveal that non-financial factors occur prior to financial ratios when attempting to predict organisational success or failure and the IMM approach enables a more thorough examination of the predictive ability of financial ratios for US and Australian organisations. This intuitively indicates that when combined with financial ratios, non-financial factors may be a useful predictor of corporate success or failure across countries and sectors.

Sound internal processes and the identification of both financial ratios and non-financial factors can be utilised to improve the reliability of financial failure models, enable corrective and preventative steps to be implemented by management and potentially reduce the costs of failure for US and Australian organisations.

The purpose of this paper is to explore the relationship of non-financial and financial factors to firm survival, provide evidence of factors related to financial success and distress for prominent Australian agricultural firms, and improve the predictive capacity of financial failure models.

The paper utilizes mixed method exploratory case studies across four Australian agricultural firms (two successful and two failed) listed on the Australian Securities Exchange.

The authors found that the use of an Integrated Multi-Measured approach provided a higher classification rate for the failed group than those provided by an individual measure. We also discovered that non-financial factors associated with the agricultural organizations studied impacted their success or failure. These factors included managements’ involvement in organizational strategy and the composition of the board of directors. It was also apparent that management decision-making approaches may become frozen, or at best restricted, in the face of impending failure, dependent upon the stress level within the organization and the management skill base.

The cases studied indicated that non-financial factors of failure occurred prior to any financial predictors, intuitively indicating a relationship between non-financial and financial factors in Australian agricultural firms.

The identification of financial and non-financial factors and sound internal processes which distinguish successful and failing firms can be utilized for the development of an early warning predictor of organizational success or failure.

The purpose of this paper is to examine the profile of accounting research in the two academic accounting research journals in South Africa (Meditari Accountancy Research and SA Journal of Accounting Research) during the ten‐year period from 2000 to 2009.

The archival research method is applied, which analyses existing data (in this case the articles published in the South African (SA) accounting research journals) to come to research conclusions. The research method used to analyse the related articles in the SA accounting research journals is based on various international studies. The following dimensions are assessed: authorship; research field; the nature of the research; and research methods. Authorship is classified by institution, and the top seven authors by relative contribution are also identified. Both empirical and theoretical work are classified separately in different research methods.

These different dimensions provide a broad‐based review of the current profile of accounting research in South Africa.

Other refereed academic articles in the field of accounting have been published in non‐accounting specific SAPSE‐approved journals. These articles are also excluded from the scope of this research since the journals in which they are published have not been established by accounting academics specifically.

The motivation for doing this research is to identify the current profile of accounting research in South Africa that could be used as a basis for future research‐related development.

Knowledge of the profile of accounting research in South Africa could provide opportunities for scholars to expand identified research areas and explore methods that are currently under‐developed in the South African accountancy research field. The paper also acknowledges the contributions by the most prolific authors in the identified journals.