Accounting

As a result of high economic inequality, widespread discontent with excessive chief executive officer (CEO) compensation levels is acute in South Africa (SA). Some commentators argue that instead of high levels of CEO pay causing inequality, it may be part of the solution if higher levels of CEO compensation translate into better company performance, so reducing unemployment.

International studies investigating the relationship between CEO short-term cash compensation and current company performance generally report a weak or no relationship where accounting based measures of performance are used. Developments in the international literature reflect a stronger relationship when long-term incentive compensation (LIC) is included and total shareholder return (TSR) used to measure company performance. However, a concerning negative association between the highest paid CEOs in terms of excess LIC and future abnormal TSR is reported.

In contrast, SA pay-performance research is largely not reflective of the developments in the international literature, with local studies mostly finding no pay-performance relationship, except where size-related accounting measures are used. As a result of the strong correlation between CEO pay and company size reported in the international literature, and local studies not adequately controlling for company size, the accuracy of the conclusions drawn in prior studies on the pay-performance sensitivity relationship in SA are brought into question.

This study addresses the gaps in the SA literature by investigating the relationship between the size-adjusted excess CEO compensation and future abnormal TSR for the top 100 SA companies listed on the Johannesburg Stock Exchange for the period 2011 to 2013. A positive relationship is found between future abnormal TSR and short-term cash compensation, but not LIC. The levels and structure of CEO compensation in SA is also described.

Some of the main challenges faced in accounting education are developing professional skills and encouraging deep learning in students. The literature offers numerous accounts of the case study method as a successful tool for developing professional skills and linking theory with practice. This paper reports on a follow-up study which aimed to contribute to the field in three ways: 1) in corroborating the findings of a prior study on case studies as a tool to develop professional skills, 2) by investigating whether changes in the way the case study was administered had an effect on students’ perceived development, and 3) by gaining some insight into the actual learning that took place by analyzing the assessment outcomes. The findings show that the changes in the way the assignment was administered had no significant effect on the perceptions of students, but that team selection and the provision of homework assistance should be carefully considered. The assessment results support s...

University success is impacted largely by the successful transition of students in their first year. This study’s objective is to identify the motives, expectations and preparedness of first-year accounting students enrolled for an accounting degree at the University Of the Western Cape (UWC) for higher education. Students’ motives, expectations and preparedness for higher education have been found to impact their success in their tertiary studies. A quantitative approach was used for this study. A questionnaire was administered to first-year accounting students at UWC during the first lecture of their first accounting module. Descriptive statistics was used in order to analyse the data obtained from the questionnaire.  The findings include that students’ time commitments were aligned to that proposed by the university, that they were motivated by a mixture of internal and external factors and that they expected to grow intellectually as a result of studying B.Com (Accounting) at UW...