ACCOUNTING AND AUDITING OF SECTIONAL TITLE PROPERTY:AN OVERVIEW FROM THE GOVERNANCE PERSPECTIVE IN A DEVELOPING COUNTRY

Risk Governance & Control: Financial Markets & Institutions

Leandi Steenkamp¹ 

关键词: Sectional Title;    Body Corporate;    Audit;    Assurance;    Audit Reports;    Trustees;    Managing Agents;   

DOI  :  10.22495/rgcv7i1art2

学科分类：社会科学、人文和艺术（综合）

来源: Virtus Interpress

【 摘 要 】

The sectional title industry has been a part of the property landscape in South Africa for almost half a century, and plays a profound role in addressing the housing problem in the country. Stakeholders such as owners and investors in sectional title property are in most cases not directly involved in the management thereof, and place reliance on the audited annual financial statements of bodies corporate for decision-making purposes. Although the industry seems to be highly regulated, the legislation regarding accounting and auditing of sectional title property is vague and ambiguous. Furthermore, there are no industry-specific auditing and accounting standards to guide accounting and auditing practitioners in performing their work and industry financial benchmarks are not readily available. In addition, financial pressure on sectional title schemes is often very high due to the fact that some owners exercise unrealistic pressure to keep monthly levies as low as possible. Very little academic research has been undertaken on the sectional title industry in South Africa from an accounting and auditing perspective. The aim of this article is threefold: Firstly, to discuss the findings of a literature review on uncertainties, ambiguity and confusing aspects in legislation regarding the audit of sectional title property that may cause or increase the audit expectation gap. Secondly, to discuss the empirical findings of accountancy-related aspects of a sample of body corporate financial statements and accompanying audit reports, in order to identify current benchmarks, challenges, trends, deficiencies in reporting and possible norms for the sectional title industry. Specific reference will be made to the difference between the bodies corporate in the Mangaung and Matjhabeng areas. Thirdly, practical recommendations will be made on possibilities of closing the expectation gap, and further research opportunities in this regard will be discussed.

【 授权许可】

CC BY-NC