Original Research

Business rescue practices in South Africa: An explorative view

Talira Naidoo, Adnan Patel, Nirupa Padia
Journal of Economic and Financial Sciences | Vol 11, No 1 | a188 | DOI: https://doi.org/10.4102/jef.v11i1.188 | © 2018 Talira Naidoo, Adnan Patel, Nirupa Padia | This work is licensed under CC Attribution 4.0
Submitted: 09 February 2018 | Published: 20 June 2018

About the author(s)

Talira Naidoo, Department of Auditing, University of the Witwatersrand, South Africa
Adnan Patel, Department of Auditing, University of the Witwatersrand, South Africa
Nirupa Padia, Department of Auditing, University of the Witwatersrand, South Africa

Abstract

Business rescue proceedings attempt to rehabilitate businesses that are in financial distress. In spite of its importance, there is a seemingly low rate of success of the current business rescue regime (at just 15% as at June 2016). This article seeks to understand the issues that may be hindering the current rate of success of business rescue proceedings and provides practising accountants (in their capacity as business rescue practitioners) with a better understanding of the issues surrounding business rescue attempts. This will allow them to better perform their duties and give corporates in need of rescue a fighting chance. Through the use of qualitative interviews, the research findings show that there is a lack of clarity of the definition of success, which may be cause for concern. However, in the view of practitioners, the success rate is expected to improve with time. This study provides details on a few key insights into business rescue practices in South Africa, namely, the practitioners’ perceptions of success, their perceptions of the trust of stakeholders during the course of business rescue, their perceptions of the impact of the qualifications and experience of the business rescue practitioner, and their perceptions on the preparation of the business rescue plan.

Keywords

business rescue; success; Companies Act; rescue practice; practitioner; South Africa

Metrics

Total abstract views: 4100
Total article views: 8367

 

Crossref Citations

1. Methodological Considerations in the Professional Accreditation Research
Onesmus Ayaya, Marius Pretorius
SAGE Open  vol: 11  issue: 4  first page: 215824402110525  year: 2021  
doi: 10.1177/21582440211052557