Audit Committee Characteristics Research Articles

Nexus between audit committee characteristics and audit report lag in an emerging economy: an analysis using frequentist and Bayesian regression models

Nexus between audit committee characteristics and audit report lag in an emerging economy: an analysis using frequentist and Bayesian regression models

Relationship between the composition of the audit committee and earnings quality in Tier One banks in Nairobi City County, Kenya.

This study investigates the relationship between audit committee composition and earnings quality in Tier One banks in Nairobi City County, Kenya. The composition of audit committees, particularly the presence of independent directors, financial experts, and industry experts, is hypothesized to significantly influence the quality of reported earnings. Using a sample of six Tier One banks over the period 2016-2021, this study employs a correlational research design to examine this relationship. Data was collected through questionnaires administered to 90 respondents across operational, middle, and lower management levels, with a response rate of 67%. The study utilized descriptive statistics, correlation analysis, and multiple regression analysis to analyze the data. Key findings indicate a positive and statistically significant relationship between audit committee composition and earnings quality. Specifically, the presence of independent directors (r = 0.38, p < 0.05), financial experts (r = 0.29, p < 0.05), and industry experts (r = 0.26, p < 0.05) on the audit committee were all positively correlated with measures of earnings quality. The regression analysis further confirmed these relationships, controlling for other audit committee characteristics such as size and meeting frequency. These findings suggest that the composition of audit committees plays a crucial role in enhancing the quality of financial reporting in Tier One banks in Kenya. The study recommends that regulatory bodies and bank management prioritize the appointment of independent directors with relevant financial and industry expertise to audit committees. This research contributes to the existing literature on corporate governance in the banking sector and provides practical implications for improving financial reporting quality in emerging markets.

Audit Committee Characteristics and Fraudulent Financial Reporting

Audit Committee Characteristics and Fraudulent Financial Reporting

Do audit firm and audit committee characteristics influence the reporting of key audit matters? Evidence from Palestine

Do audit firm and audit committee characteristics influence the reporting of key audit matters? Evidence from Palestine

The Effect of Audit Committee Characteristics, Audit Opinion, and Company Size on Financial Reporting Fraud

The Effect of Audit Committee Characteristics, Audit Opinion, and Company Size on Financial Reporting Fraud

Impact of audit committee characteristics on risk disclosure: evidence from the banking sector of Pakistan

Impact of audit committee characteristics on risk disclosure: evidence from the banking sector of Pakistan

THE IMPACT OF AUDIT COMMITTEE CHARACTERISTICS ON THE SHARE HOLDER VALUE CREATION: EVIDENCE FROM INDONESIA

This research seeks to investigate the characteristics of company performance audit committees and their impact on company value. We conducted an analysis of family companies in Indonesia, especially family companies that are over 20 years old. We analyzed the data we collected using multiple regression. The research results provide quite strong empirical evidence that the frequency of audit committee meetings and the company's financial performance have positive significance in increasing shareholder value. This research provides implications for family companies, especially for maintaining good financial performance and maintaining the independence of the audit committee through the involvement of external audit committee members. It is hoped that the selected audit committee will not come from the family or have any family affiliation with the companyKeywords: audit committee characteristics, financial performance, shareholder value.

Audit Committee Characteristics and Financial Reporting Quality of Consumer Good Firms in Nigeria

The paper examined the impact of audit committee features on the reporting quality of consumer goods firms in Nigeria. The paper used an ex post facto design. Data were gathered from the audited annual reports of the target firms. By employing the Hausman test, the study used a fixed and random effect model. The F-statistic of 2.238984, p-value = 0.023456 < 0.05 alpha, suggests that audit team meetings, size and financial knowledge jointly have a substantial implication on the calibre of financial reporting. In light of the foregoing, the study suggested among others that firms should maintain an optimal size that balances efficiency with diverse expertise that is neither too small nor too large for thorough financial oversight.

Characteristics of the Audit Committee and the Environmental, Social, Governance (ESG) Performance in Indonesian Companies

This study intends to experimentally demonstrate the impact of audit committee features on Environmental, Social, and Governance (ESG) performance in companies listed on the Indonesia Stock Exchange. The study specifically looks at how the number, tenure, independence, expertise, and frequency of audit committee meetings can impact ESG performance. A sample of the companies comprised in the Bloomberg database was used to gather information on the audit committee’s composition and ESG performance. With a total of 288 observations covering the years 2018 to 2021, the sample consists of 72 firms. According to the study’s conclusions, the size of audit committees and their level expertise have a positive impact on ESG performance. However, the length of the audit committee’s term, independence, and the frequency of audit committee meetings do not significantly impact ESG performance. These findings highlight the critical oversight functions that audit committees perform in maintaining a company’s commitment to all stakeholders and show that businesses typically follow social norms and international standards. Keywords: audit committee characteristics, ESG performance, corporate governance

The impact of the characteristics of audit committees on the quality of financial reports

The impact of the characteristics of audit committees on the quality of financial reports

The influence of board and audit committee characteristics on CSR reporting in Bahrain: the legitimacy perspective

The influence of board and audit committee characteristics on CSR reporting in Bahrain: the legitimacy perspective

The Effect Of Audit Committee Characteristics On Earnings Management: A Case Study Of Non-Financial Bumn Companies In Indonesia For The Period 2018-2022

This study aims to further investigate the effect of audit committee characteristics on earnings management practices, as measured by earnings management, in non-financial state-owned companies. This research uses quantitative methodology and data sources are obtained from secondary data. This analysis technique uses multiple regression analysis techniques, classical assumption tests and hypothesis testing, the data observations used in this study were 55. The findings of this study indicate the results of the study that audit committee activity has no significant effect on earnings management so that H1 is not supported, the audit committee size variable shows the results of a significant negative effect on earnings management so that H2 is supported, In line with H1, audit committee competence has no significant effect on earnings management so that H3 is not supported.

The Impact of Audit Committee Characteristics on ESG

In light of the growing significance of sustainability objectives and their connection with future economic landscapes, and considering the fundamental role of audit committees in the financial reporting environment, this study aims to measure the impact of audit committees characteristics on the level of disclosure of Environmental, Social, and Governance (ESG) practices in the annual reports of companies listed on the Saudi financial market. This study utilizes the ESG index compiled by Bloomberg, which measures companies' disclosure levels for this purpose. Due to data availability, the sample includes 44 companies listed on the main market during the period from 2017 to 2021. Using multiple regression analysis, this study shows a positive impact of the independence, size, and financial expertise of audit committees on the level of disclosure of ESG practices. Additionally, the results show a negative impact of the number of audit committee meetings on the level of disclosure of ESG practices. KEYWORDS accounting, financial expertise, independence, quality, size, sustainability

Peran Modal Intelektual Sebagai Variabel Moderasi Pada Pengaruh Kepemilikan Institusional, Karakteristik Komite Audit, Dan Gender Diversity Terhadap Financial Distress

Data from energy businesses listed on the Indonesia Stock Exchange will be used to examine the moderating effect of intellectual capital on the relationships between institutional ownership, audit committee characteristics, and financial distress. The Financial Reports and Annual Reports available on the official website of the Indonesia Stock Exchange served as the data and information source for this study. This study relies on secondary data collected throughout 2019–2021, with a total sample size of 96 drawn using a purposive sampling strategy. Logistic regression is used as the analytical model. According to the data, gender diversity contributes negatively to monetary stress. The impact of audit committee features on financial distress can be bolstered by intellectual capital, and the negative effect of gender diversity on financial distress can be amplified. Financial Distress is not exacerbated by Intellectual Capital, and neither institutional ownership nor audit committee features have a negative effect on it, as shown by the data

THE IMPACT OF AUDIT COMMITTEE CHARACTERISTICS ON FINANCIAL REPORTING QUALITY: EVIDENCE FROM SAUDI ARABIA

Purpose: The purpose of this study is to investigate the impact of audit committee characteristics, namely independent members in the audit committee, a financial expert in the audit committee, frequency of meetings, and audit committee size on financial reporting quality proxies by qualified audit opinion, to shed light on the role of audit committee characteristics towards the financial reporting quality with audit quality as one of the control variables, particularly the appointment of Big 4 company. Design/Methodology/Approach: A sample of 292 observations from Saudi non-financial listed companies from 2019 -2022 were collected from annual reports across four years and analyzed using panel data. To analyze the proposed hypothesis, the study employed multiple linear regression and logistic regression. Findings: The results indicate that the only audit committee characteristic statistically related to financial reporting quality measured by qualified audit opinion is the financial expert's number. There is also evidence that audit quality measured by audit company size (Big4) is positively related to the audit committee and financial reporting quality. Research Limitations/Implications: The study’s main limitation is that a large sum of the data collected are traced back to the lockdown period. Therefore, the examined issues could change in the future due to the shift in priorities that the COVID-19 pandemic is determining. Practical Implications: The result will help accountancy professionals and governments as it highlights the relevance of qualified audit opinions to audit committees and enhances audit committees’ characteristics and role in improving audit quality. The findings of this study contribute to the current audit quality and reporting literature.

Influence of CEO characteristics and audit committee on financial performance: Evidence from Iraq

The study aims to identify the effect of the CEO and audit committee characteristics on financial performance. To achieve the study's goal, panel data was adopted for 43 private Iraqi banks from 2018 to 2022 with 215 observations. The data was analyzed using Stata. Three models were used to analyze the data, and the preferred model was chosen by following several confirmation steps. The findings indicated that CEO education, CEO ownership, and CEO experience all influenced financial success. The audit committee's characteristics also played an essential role in the link between the characteristics of the CEO and financial performance. This study is added to critical studies for regulatory authorities and decision-makers, especially since shareholders and decision-makers always seek to appoint CEOs with the capabilities and talents to enable them to achieve shareholders' goals and enhance banks' competitiveness in different environments.

The moderating role of board gender diversity on the relationship between audit committee characteristics and financial performance: evidence from Egypt

Purpose The purpose of this paper is to investigate whether audit committee characteristics, in particular audit committee size, audit committee activity and audit committee gender diversity, are associated with financial performance in Egyptian banks. The second purpose of this paper is to explore the moderating role of board gender diversity on the relationship between audit committee characteristics and financial performance. Design/methodology/approach A multiple regression analysis is used to estimate the moderating role of board gender diversity on the relationship between audit committee characteristics and financial performance of a sample of Egyptian banks during the period between 2018 and 2022. Findings The results indicate that audit committee size has a negative and insignificant effect impact on return on assets (ROA) and return on equity (ROE), respectively. The results also indicate that the audit committee gender diversity has a significant positive impact on ROA and ROE, respectively. Regarding audit committee activity, the number of board meetings has a negative and insignificant effect on ROA and ROE, respectively. Regarding gender diversity as a moderating variable, in general there is a positive effect of gender diversity on the relationship between audit committee characteristics and financial performance. Research limitations/implications The study was limited to 20 banks in one country, but it sets the tone for future empirical research on this subject matter. The study also relied on one moderating variable, which is board gender diversity. This study provides an avenue for future research in the area of corporate governance and financial performance in other emerging countries, especially other African countries. Practical implications This study provides useful insights for managers and policymakers to better understand which audit committee characteristics can best encourage a company to improve financial performance. Furthermore, regulators should ensure that banks strictly adhere to corporate governance principles to build a strong banking industry capable of achieving economic development. Social implications Banks will benefit equally from valuable qualities across demographic groupings in society by having females on the audit committee and appropriate audit committee meetings. Additionally, if audit committee members are correctly selected, banks with more females in audit committee and suitable audit committee meetings can successfully contribute to strengthening financial performance and social welfare of diverse segments of society. A culture of good banking governance must emerge to improve bank financial stability and, as a result, greater stability and economic growth. Originality/value To the best of the authors’ knowledge, the study is, perhaps, the first to examine the moderating role of board gender diversity on the relationship between audit committee characteristics and financial performance in Egyptian banks. This study adds to the literature by investigating such an issue in a developing economy that operates in a different context than those in developed countries.

Effects of Audit Committee on Fraudulent Financial Reporting Among Listed Firms in Kenya.

Fraudulent financial reporting poses significant risks to the integrity of financial markets, investor confidence, and the overall economy. As a result, effective corporate governance mechanisms are crucial in mitigating the occurrence of fraudulent activities. The audit committee, as a key component of corporate governance, plays a vital role in overseeing financial reporting and providing assurance on the reliability of financial statements. This paper aims to explore the effects of audit committee characteristics on fraudulent financial reporting of listed firms in Kenya. Specifically, the study assessed the effect of Audit Committee; gender, financial expertise, size and independence on fraudulent financial reporting. The study was anchored on the Fraud Pentagon theory. Explanatory research design and longitudinal research design was employed in this study where secondary panel data was obtained through content analysis from audited financial statements spanning from 2012 to 2021. The study targeted listed firms in Kenya during the study period and only firms that met the inclusion and exclusion criteria were retained. After applying the inclusion/exclusion criteria only 40 firms formed the study population. Data was analyzed using descriptive and inferential statistics with the significance of each independent variable being tested at 95% confidence level. The findings show that Gender (β1 = -.1154, p=.000.05) and Financial expertise (β2 = -.200, p=.000.05), Size (β3 = -.1457, p=.001.05), and Independence (β4 = -.1818, p=.000.05) had negative and significant effect on fraudulent financial reporting on firms in Kenya. Thus, the study concluded that audit committee characteristics such as gender variability, audit committee size, audit committee financial expertise and audit committee independence significantly influence fraudulent financial reported among listed firms in Kenya. Based on the findings, the study recommends enhancing the effectiveness of the audit committee in preventing fraudulent financial reporting, organizations should strive for gender diversity within the committee. This can be achieved by actively seeking and appointing qualified female candidates to the audit committee. Promoting diversity ensures a range of perspectives and experiences, leading to more robust discussions, increased scrutiny of financial reporting practices, and improved decision-making. Secondly, Organizations should prioritize the independence of the audit committee by ensuring that committee members are free from any conflicts of interest and have no direct ties to management. Additionally, Organizations should carefully consider the size of the audit committee to optimize its effectiveness in addressing fraudulent financial reporting. Lastly, Organizations should establish mechanisms for continuous monitoring and evaluation of the audit committee's performance. Regular assessments of the committee's effectiveness in detecting and preventing fraudulent financial reporting can help identify areas for improvement.

Beyond the bottom line: exploring the role of governance mechanisms in promoting corporate tax responsibility

PurposeBecause of growing corporate tax scandals, there is an enhanced focus on corporate taxation by governments, institutions and the general public. Transparency in tax matters has been identified as critical for effectively managing and promoting socially responsible tax behaviour. This study aims to explore the impact of ownership structure, board and audit committee characteristics on corporate tax responsibility (CTR) disclosure.Design/methodology/approachThis research collected data from the annual reports of Pakistani-listed firms over 12 years, from 2009 to 2020. Consequently, the data set encompasses a total of 1,800 firm-year observations. This study uses regression analysis to test the relationship between corporate governance and CTR disclosure.FindingsThe results show that board gender diversity, managerial ownership and audit committee independence promote tax responsibility disclosure. In contrast, family board membership, CEO duality, foreign ownership and family ownership negatively impact tax responsibility disclosure. Additional analyses reveal the specific information categories that produce the overall effects on tax responsibility disclosure and assess the moderating impact of family firms on the governance and CTR disclosure nexus.Practical implicationsCorporations can use the results to encourage practices that enhance transparency and improve the quality of disclosures. Regulatory authorities can use the findings to stipulate better protocols. Doing so will be vital for developing countries such as Pakistan to improve tax revenue and cultivate economic growth.Originality/valueWhile this research represents, to the best of the authors’ knowledge, one of the first empirical investigations of the association between corporate governance and CTR, the results contribute to the corporate governance literature and offer fresh insights into CTR, an emerging dimension of corporate social responsibility.

The Impact of Audit Committee Characteristics on Auditor’s Opinion Shopping

The Impact of Audit Committee Characteristics on Auditor’s Opinion Shopping