An Investigation Into The Legitimisation Of The Role Of The Professional Accountant Within South African SMEs
Keywords:
isomorphism; legitimacy; professional accountant; SMESAbstract
This study explores issues regarding the legitimacy of the professional accountant’s role within South African Small to Medium Enterprises (SMEs). This study is a social deconstruction of the acceptance of a professional accountant’s service offerings to SMEs through the lens of isomorphism. This exploration pioneers to comprehend the legitimacy and social construction of the role of the professional accountant within SMEs. Using institutional isomorphism as a theoretical framework and interviews with 20 professional accountants and 20 SME owners, the lived experiences of the interpretivist approach makes a substantial contribution to qualitative accountancy research within the accountancy SME environment. The isomorphic tests reveal strong normative and coercive isomorphic pressures as well as the presence of mimetic isomorphic pressures which influence the formation and structure of the current role of the professional accountant within the SME environment. Furthermore, this paper makes a significant contribution regarding the legitimacy of professional accountants within SMEs to policy makers, professional accountancy organizations and academics who further aim to research within developing economies.
References
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Dowling, J., & Pfeffer, J. (1975). Organizational legitimacy: Social values and organizational behavior. Pacific sociological review, 18(1), 122-136.
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Franco-Santos, M., Lucianetti, L., & Bourne, M. (2012). Contemporary performance measurement systems: A review of their consequences and a framework for research. Management accounting research, 23(2), 79-119.
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Kim, J., Hatcher, C., & Newton, C. (2012). Professional identity of management accountants: leadership in changing environments.
Lepoutre, J. M., & Valente, M. (2012). Fools breaking out: The role of symbolic and material immunity in explaining institutional nonconformity. Academy of management journal, 55(2), 285-313.
Lieberman, M. B., & Asaba, S. (2006). Why do firms imitate each other? Academy of management review, 31(2), 366-385.
Lose, T., & Tengeh, R. K. (2015). The sustainability and challenges of business incubators in the Western Cape Province, South Africa. Sustainability, 7(10), 14344-14357.
Louw, A. (2016). The FRIP as a mechanism of accountability in the South African financial reporting environment.
Meyer, J. W., & Rowan, B. (1977). Institutionalized organizations: Formal structure as myth and ceremony. American journal of sociology, 83(2), 340-363.
Mir, M. Z., & Rahaman, A. S. (2002). Institutional isomorphism and the adoption of lASs in a developing country: another crisis of external dependence.
Neuman, W. L. (2013). Social research methods: Qualitative and quantitative approaches (7 ed.). Boston , USA: Pearson Higher Ed USA.
Ramsden, M., & Bennett, R. (2005). The benefits of external support to SMEs:" Hard" versus" soft" outcomes and satisfaction levels. Journal of Small Business and Enterprise Development, 12(2), 227.
Roberts, J. (1991). The possibilities of accountability. Accounting, organizations and society, 16(4), 355-368.
Rodrigues, L. L., & Craig, R. (2007). Assessing international accounting harmonization using Hegelian dialectic, isomorphism and Foucault. Critical perspectives on accounting, 18(6), 739-757.
Strike, V. M. (2012). Advising the family firm: Reviewing the past to build the future. Family Business Review, 25(2), 156-177.
Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of management review, 20(3), 571-610.
Williams, B. R., & O'Donovan, G. (2015). The accountants’ perspective on sustainable business practices in SMEs. Social Responsibility Journal, 11(3), 641-656.
Ziady, H. (2018, 12 July 2018). How Saica... Hears no evil, speaks no evil and sees no evil. Financialmail.
Berry, A. (2006). Banks, SMEs and accountants-an international study of SMEs' banking relationships.
Berry, A. J., Sweeting, R., & Goto, J. (2007). The effect of business advisers on the performance of SMEs. Journal of Small Business and Enterprise Development.
Carnegie, G. D., & Napier, C. J. (2010). Traditional accountants and business professionals: Portraying the accounting profession after Enron. Accounting, organizations and society, 35(3), 360-376.
Carruthers, B. G. (1995). Accounting, ambiguity, and the new institutionalism. Accounting, organizations and society, 20(4), 313-328.
Cheffi, W., & Beldi, A. (2012). An analysis of managers' use of management accounting. International Journal of Business, 17(2), 113.
Covaleski, M. A., Dirsmith, M. W., & Michelman, J. E. (1993). An institutional theory perspective on the DRG framework, case-mix accounting systems and health-care organizations. Accounting Organizations and Society, 18(1), 65-80.
Creswell, J. W., & Clark, V. L. P. (2014). Designing and conducting mixed methods research (2nd ed.): Sage Publications.
Crotty, A. (2017). KPMG to be investigated for audit of company linked to Gupta wedding scandal. Businesslive. Retrieved from https://www.businesslive.co.za/bd/companies/financial-services/2017-06-30-kpmg-to-be-investigated-for-audit-of-linkway/
Deegan, C. (2002). Introduction: The legitimising effect of social and environmental disclosures–a theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282-311.
DiMaggio, P., & Powell, W. W. (1983). The iron cage revisited: Collective rationality and institutional isomorphism in organizational fields. American sociological review, 48(2), 147-160.
Dowling, J., & Pfeffer, J. (1975). Organizational legitimacy: Social values and organizational behavior. Pacific sociological review, 18(1), 122-136.
Fernando, S., & Lawrence, S. (2014). A theoretical framework for CSR practices: integrating legitimacy theory, stakeholder theory and institutional theory. Journal of Theoretical Accounting Research, 10(1), 149-178.
Fogarty, T. J., Zucca, L. J., Meonske, N., & Kirch, D. P. (1997). Proactive practice review: a critical case study of accounting regulation that never was. Critical perspectives on accounting, 8(3), 167-187.
Franco-Santos, M., Lucianetti, L., & Bourne, M. (2012). Contemporary performance measurement systems: A review of their consequences and a framework for research. Management accounting research, 23(2), 79-119.
Greenwood, R., Suddaby, R., & Hinings, C. R. (2002). Theorizing change: The role of professional associations in the transformation of institutionalized fields. Academy of management journal, 45(1), 58-80.
Hawley, A. H. (1986). Human ecology: A theoretical essay: University of Chicago Press.
Hoque, Z. (2014). 20 years of studies on the balanced scorecard: Trends, accomplishments, gaps and opportunities for future research. The British Accounting Review, 46(1), 33-59.
ICAEW. (2011). The Finance Function : A Framework for Analysis. Retrieved from United Kingdom:
IFAC. (2016). The relationship between accountancy expertise and business performance. Retrieved from https://www.ifac.org/publications-resources/relationship-between-accountancy-expertise-and-business-performance
Ismail, K., & Ajagbe, A. M. (2013). The Roles of Government in the Commercialization of Technology Based Firms. Middle-East Journal of Scientific Research, 16(2), 229-236.
Kamyabi, Y., & Devi, S. (2012). The impact of advisory services on Iranian SME performance: An empirical investigation of the role of professional accountants. S African Journal of Business management, 43(2), 61-72.
Kim, J., Hatcher, C., & Newton, C. (2012). Professional identity of management accountants: leadership in changing environments.
Lepoutre, J. M., & Valente, M. (2012). Fools breaking out: The role of symbolic and material immunity in explaining institutional nonconformity. Academy of management journal, 55(2), 285-313.
Lieberman, M. B., & Asaba, S. (2006). Why do firms imitate each other? Academy of management review, 31(2), 366-385.
Lose, T., & Tengeh, R. K. (2015). The sustainability and challenges of business incubators in the Western Cape Province, South Africa. Sustainability, 7(10), 14344-14357.
Louw, A. (2016). The FRIP as a mechanism of accountability in the South African financial reporting environment.
Meyer, J. W., & Rowan, B. (1977). Institutionalized organizations: Formal structure as myth and ceremony. American journal of sociology, 83(2), 340-363.
Mir, M. Z., & Rahaman, A. S. (2002). Institutional isomorphism and the adoption of lASs in a developing country: another crisis of external dependence.
Neuman, W. L. (2013). Social research methods: Qualitative and quantitative approaches (7 ed.). Boston , USA: Pearson Higher Ed USA.
Ramsden, M., & Bennett, R. (2005). The benefits of external support to SMEs:" Hard" versus" soft" outcomes and satisfaction levels. Journal of Small Business and Enterprise Development, 12(2), 227.
Roberts, J. (1991). The possibilities of accountability. Accounting, organizations and society, 16(4), 355-368.
Rodrigues, L. L., & Craig, R. (2007). Assessing international accounting harmonization using Hegelian dialectic, isomorphism and Foucault. Critical perspectives on accounting, 18(6), 739-757.
Strike, V. M. (2012). Advising the family firm: Reviewing the past to build the future. Family Business Review, 25(2), 156-177.
Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of management review, 20(3), 571-610.
Williams, B. R., & O'Donovan, G. (2015). The accountants’ perspective on sustainable business practices in SMEs. Social Responsibility Journal, 11(3), 641-656.
Ziady, H. (2018, 12 July 2018). How Saica... Hears no evil, speaks no evil and sees no evil. Financialmail.
Published
2020-08-10
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Yasseen, Y., Stegmann, N., & Crous, F. (2020). An Investigation Into The Legitimisation Of The Role Of The Professional Accountant Within South African SMEs: Array. The Journal of Accounting and Management, 10(2). Retrieved from https://dj.univ-danubius.ro/index.php/JAM/article/view/433
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