The relationship between the board characteristics and the risk of material misstatement

Abstract

This paper chose corporate governance as the starting point, combined with the characteristics of China's current board of directors of listed companies and the risk of material misstatement, and tries to find out the correlation between the two.In this paper, empirical research and normative research method are both used. The listed companies which are warned by the China Securities Regulatory Commission, Shanghai Stock Exchange, Shenzhen Stock Exchange because of irregularities are selected. The board size, proportion of independent directors, the board meetings, audit committees, etc. such the Board characterized as explanatory variable, after controlling the firm size, profitability and other factors, the Logistic regression model was constructed. The empirical results show: board size, the board meetings, audit committees and other factors at different levels of impact on risk of material misstatement.