South Africa: View From the Peninsula - Is Big Business 'Bad' and Small Business 'Good'?


The narrative that big business is bad and small business is acceptable is part of a toxic economic environment and needs to change.

December 5th 2017 is a date that will be firmly etched in the memories of South African investors large and small. It was the day that furniture manufacturer and retailer Steinhoff imploded on the back of accounting fraud and investors lost a collective R200-billion.

Despite the company clawing its way back from bankruptcy and producing decent results in 2019, the chance of the majority of investors seeing any returns is zero.

The company released its audited financials for the year to September 2019 last week. Mazars, which took over the audit from Deloitte in 2019, has unsurprisingly issued a disclaimer of opinion on the consolidated and separate financial performance and consolidated and separate cash flows.

They have also issued a qualified audit opinion on the company's financial position.

While the auditors accept that the financial statements are an accurate and fair reflection of the current financial position of Steinhoff and its subsidiaries, Mazars could not trust the accuracy of the financial information in the 2017 and 2018 financial statements. This is integral to making an informed assessment...

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