Full Text Available
Note: Clicking the button above will open the full text document at the original institutional repository in a new window.
The role of the cash basis in limited purpose financial reporting
The strictly regulated environment within which corporate accounting practice evolves, has traditionally paid little attention to the owner-managed corporation and the specific information needs of its owners. The literature, as well as recent corporate law amendments, though, hints strongly that own...
Saved in:
| Main Author: | |
|---|---|
| Other Authors: | |
| Format: | Thesis |
| Language: | English |
| Published: |
College of Accounting
2017
|
| Subjects: | |
| Tags: |
No Tags, Be the first to tag this record!
|
| _version_ | 1867613263071543296 |
|---|---|
| access_status_str | Open Access |
| author | Lotter, Willem Adriaan |
| author2 | Everingham, Geoff K |
| author_browse | Everingham, Geoff K Lotter, Willem Adriaan |
| author_facet | Everingham, Geoff K Lotter, Willem Adriaan |
| author_sort | Lotter, Willem Adriaan |
| collection | Thesis |
| description | The strictly regulated environment within which corporate accounting practice evolves, has traditionally paid little attention to the owner-managed corporation and the specific information needs of its owners. The literature, as well as recent corporate law amendments, though, hints strongly that owner-managed entities have different financial reporting priorities than their publicly accountable counterparts. This difference in financial reporting priorities calls for rethinking at the most fundamental level of financial reporting, i.e. accrual versus cash-basis financial reporting. This implies that the debate about the extent of sophistication that should be built into the accrual-basis model can only be conducted sensibly after the primary debate of accrual versus cash-basis, is resolved satisfactorily. The question as to whether measurement and recognition criteria within an accrual-basis model should be relaxed is therefore part of the secondary debate. The basic research question relates to the usefulness to owner-managers of cash-basis accounting compared to accrual-basis accounting. This thesis reports on the responses of 243 practising members of the South African Institute of Professional Accountants (SAIPA) regarding owner-manager needs and preferences regarding financial accounting recording and reporting practices. Semi- structured interviews were conducted with owner-managers to verify the understanding of the practitioners regarding owner-manager needs and preferences. The results showed and explained an apparent paradox: owner-managers have a strong cash focus in the way they understand and use financial information, but nevertheless prefer accrual-basis annual financial statements. The unresolved challenge identified by this study is to design a financial report which could better bridge the gap between accrual-basis and cash-basis accounting than the conventional statement of cash flow. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/26146 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:33:21.255Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2017 |
| publishDateRange | 2017 |
| publishDateSort | 2017 |
| publisher | College of Accounting |
| publisherStr | College of Accounting |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/26146 The role of the cash basis in limited purpose financial reporting Lotter, Willem Adriaan Everingham, Geoff K Financial Accounting The strictly regulated environment within which corporate accounting practice evolves, has traditionally paid little attention to the owner-managed corporation and the specific information needs of its owners. The literature, as well as recent corporate law amendments, though, hints strongly that owner-managed entities have different financial reporting priorities than their publicly accountable counterparts. This difference in financial reporting priorities calls for rethinking at the most fundamental level of financial reporting, i.e. accrual versus cash-basis financial reporting. This implies that the debate about the extent of sophistication that should be built into the accrual-basis model can only be conducted sensibly after the primary debate of accrual versus cash-basis, is resolved satisfactorily. The question as to whether measurement and recognition criteria within an accrual-basis model should be relaxed is therefore part of the secondary debate. The basic research question relates to the usefulness to owner-managers of cash-basis accounting compared to accrual-basis accounting. This thesis reports on the responses of 243 practising members of the South African Institute of Professional Accountants (SAIPA) regarding owner-manager needs and preferences regarding financial accounting recording and reporting practices. Semi- structured interviews were conducted with owner-managers to verify the understanding of the practitioners regarding owner-manager needs and preferences. The results showed and explained an apparent paradox: owner-managers have a strong cash focus in the way they understand and use financial information, but nevertheless prefer accrual-basis annual financial statements. The unresolved challenge identified by this study is to design a financial report which could better bridge the gap between accrual-basis and cash-basis accounting than the conventional statement of cash flow. 2017-11-10T09:52:05Z 2017-11-10T09:52:05Z 2010 2017-05-18T14:16:06Z Master Thesis Masters MCom http://hdl.handle.net/11427/26146 eng application/pdf College of Accounting Faculty of Commerce University of Cape Town |
| spellingShingle | Financial Accounting Lotter, Willem Adriaan The role of the cash basis in limited purpose financial reporting |
| thesis_degree_str | Master's |
| title | The role of the cash basis in limited purpose financial reporting |
| title_full | The role of the cash basis in limited purpose financial reporting |
| title_fullStr | The role of the cash basis in limited purpose financial reporting |
| title_full_unstemmed | The role of the cash basis in limited purpose financial reporting |
| title_short | The role of the cash basis in limited purpose financial reporting |
| title_sort | role of the cash basis in limited purpose financial reporting |
| topic | Financial Accounting |
| url | http://hdl.handle.net/11427/26146 |
| work_keys_str_mv | AT lotterwillemadriaan theroleofthecashbasisinlimitedpurposefinancialreporting AT lotterwillemadriaan roleofthecashbasisinlimitedpurposefinancialreporting |