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Full Length Research
Paper
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Relevance of financial reporting systems: Single-bottom line
or triple-bottom line
James Kamwachale Khomba1*
and Frans N. S. Vermaak2
1Department
of Management Studies, University of Malawi, Private Bag
303, Blantyre 3, Malawi.
2Department
of Financial Management Sciences, University of Pretoria,
0002 Pretoria, Republic of South Africa.
*Corresponding author. E-mail:
jkkhomba@poly.ac.mw.
Accepted 9
January, 2012 |
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Abstract |
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Traditional
financial reporting systems have geared towards the
single-bottom line reporting in the form of profitability.
However, there are arguments that corporate reporting systems
should not just dwell on a single-bottom line but should be
reported upon on three elements comprising economic/financial,
social and environmental elements that constitute the
triple-bottom line. This study aimed at empirically researching
on what current practices corporate business executives and
financial managers deploy in their corporate financial reporting
systems. The focus of the study was on the assessment of the
relevance of either the single-bottom line or triple-bottom line
reporting systems within an African framework. Data was
collected using the structured questionnaire that was
administered across different countries from Southern Africa.
The study results reveal that a sustainability (triple-bottom
line) reporting system has been embraced by many organisations
in Africa. The study findings suggest that there is a need to
review and redesign accounting and financial principles and
policies so that they are aligned with the emerging
triple-bottom line reporting system requirements. The study
findings will be of much relevance to academics, researchers and
industry practitioners.
Key words:
Africa, financial reporting, Malawi, profitability,
stakeholders, sustainability, triple-bottom line.
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