Existence Of Audit Committee Research Articles

FAKTOR-FAKTOR YANG MEMENGARUHI NILAI PERUSAHAAN NON-KEUANGAN

One of the considerations for investors to invest is to see the value of the company. The aim of this study is to obtain empirical evidence regarding institutional ownership, managerial ownership, proportion of independent commissioners, board size, existence of female commissioners, board size, audit committee, profitability, and capital structure on firm value as measured using the Tobin's Q formula. The objects of this study are non-financial companies listed on the Indonesia Stock Exchange and meeting other criteria from 2019 to 2021. This study uses a purposive sampling method. Empirical evidence obtained from this study shows that profitability has a positive effect on firm value. In addition, other empirical evidence obtained shows that institutional ownership, managerial ownership, proportion of independent commissioners, board size, existence of female commissioners, board size, audit committee, and capital structure have no effect on firm value.

The effects of corporate governance on financial performance of selected companies listed at the Lusaka securities exchange

This study examines the influence of corporate governance on the financial performance of companies that are publicly traded on the Lusaka Stock Exchange (LuSE). The study uses a sample of eight corporations to examine the correlation and regression analysis of three key governance features: board independence, board size, and audit committees. The study aims to investigate the relationship between these aspects and financial outcomes. The study reveals a direct association between the size of the board and revenue, indicating that larger boards may enhance financial performance by bringing in a wider range of experience and implementing improved governance methods. Nevertheless, there is a clear inverse relationship between board independence and revenue, suggesting that greater levels of independence may not necessarily be associated with improved financial performance, potentially due to an excessive focus on risk mitigation. The existence of audit committees is directly associated with revenue, highlighting their significance in enhancing financial transparency and adherence to regulations. This study adds to the discussion on corporate governance in developing economies by emphasizing the subtle impacts of governance frameworks on financial outcomes. It implies that although some governance methods are advantageous, their effects can differ based on the particular circumstances and dynamics of the companies and marketplaces in which they function.

The impact of corporate governance mechanisms on corporate failure: an empirical evidence from Palestine Exchange

PurposeThe purpose of this research is to examine the impact of governance mechanisms on corporate failure.Design/methodology/approachThis study used a hypothesis-testing research design to collect data from the annual reports of 35 companies listed on Palestine Exchange from 2010 to 2019. Descriptive and inferential statistics were employed, along with correlation analysis to evaluate linear relationships between variables. The variance inflation factor was used to test multicollinearity, and binary logistic regression was utilized to develop the research model.FindingsThere is a significant positive relationship between board of directors' independency, institutional ownership and the quality of external audit, and corporate failure reduction. No significant relationship has been found among corporate governance variables such as board size, board meetings' frequency, board members' remuneration and audit committee existence, and corporate failure reduction.Research limitations/implicationsSeveral empirical research studies have developed models to predict corporate failure using accounting and financial data. However, limited research has empirically investigated the impact of the different mechanisms of governance on corporate failure prediction.Practical implicationsThe research highlighted the significance of companies' commitment to governance principles and their impact on predicting failure. The study suggests that decision-makers and managers can adopt different governance mechanisms to support corporate success and avoid those that may lead to negative consequences and failure.Originality/valueThis research is the first in Palestine to use a comprehensive list of corporate governance mechanisms to predict the failure of companies listed on the Palestine Stock Exchange between 2010 and 2019.

Does audit committee matter? Evidence from Tanzanian listed firms.

Aim: The primary role of audit committees is to provide oversight in the financial reporting, audit process, internal controls and in compliance with regulations and laws. The objective of this paper is to investigate the impact of board audit committees attributes on firm performance. Design/Research methods: Using a sample of firms publicly traded on the Dar es Salaam Stock Exchange (DSE) during 1998–2018; this paper estimated fixed effects regressions to tests the hypotheses developed. Conclusions/findings: The results show that audit committee attributes are positively linked with firm financial performance. Specifically, the findings reveal that audit committee attributes as measured by audit committee meetings, existence of audit committees, audit committee size and audit committee independence have positive impact on corporate performance as measured by return on sales (ROS) and profitability. These findings confirmed that firms having audit committees performed better than those without audit committees. Originality/value of the article: There is scarce research which examines the link between audit committees and firm performance in developing countries. To date, there is no study that has investigated the relationship between audit committee characteristics and firm performance in Tanzania. This paper provides new evidence on the relationship between audit committee attributes and firm performance in Tanzanian environment. Implications of the research: Overall, the findings recommend existence of large independent audit committees which conducts their meetings regularly as it is ideally enhances firm financial performance. Keywords: Audit committee attributes, corporate governance, firm performance, Tanzania JEL: G3, N27

Relationship between Corporate Governance and Firm Valuation in Nepal

In the context of growing corporate financial scandals and misconduct, the purpose of this study is to examine the relationship between various internal corporate governance measures and corporate valuation (Tobin Q) in Nepal. The study is descriptive and analytical in nature. Causal comparative research design especially multivariate regression models have been used. The method of estimation is Ordinary Least Square (OLS). Board size and independence, CEO duality and existence of audit committee as corporate governance variables and Tobin Q as performance variable for the valuation measure of 54 listed Nepalese firms over the period 2018/19 and 2019/20 have been used in the analysis. Result supports governance performance hypothesis. It shows a significant positive relationship between board size and firm value (Tobin Q). The study establishes the positive impact of CEO duality on firm valuation and concludes that independent directors are unable to play role in value creation. Finally, the role of audit committee is not significant in creating value. These results provide insights on the current regulatory provisions. The findings raise the questions over the role of our expert directors and audit committee. The need of larger board size has been established. Therefore, current regulations with respect to board size and independence; and CEO duality and audit committee need to be reassessed. Though few studies have examined role of corporate governance measures in corporate performance and valuation in Nepalese context, this study is new in its type in investigating the governance performance relationship taking recent dataset of Tobin Q as valuation measure. However, the study is based on limited internal corporate governance variables from a small sample size for only two year’s data set. Hence, generalization should be made cautiously.

Factors Influencing External Auditors’ Independence of Private Audit Firms in Ethiopia

This study was examined factors affecting auditors’ independence with reference to private audit firms in Ethiopia. The researcher employed quantitative research approach with explanatory research design where the effect caused by the independent variable on the dependent variable is observed through regression analysis. Primary data was collected through structured questionnaire from chive executive officers of private audit firm. Accordingly, the result of regression analysis showed that size of audit firm, size of audit fee, professional audit standard, competition, existence of audit committee and information technology have positive and statistically significant effect on auditors’ independence. Whereas, provision was not statistically significant. Based on the findings of the study, the researcher recommended that for audit firms in Ethiopia have to work on statistically significant variables due to fact that they have positive influence in improving auditors’ independence. Keywords: Determinants, Auditors’ Independence, Private Audit Firms, Ethiopia DOI: 10.7176/RJFA/12-11-04 Publication date: June 30 th 2021

Bank Specific Determinants of Internal Audit Effectiveness: Evidence from Private Banks in Ethiopia

This study has examined factors that affect internal audit effectiveness in the Ethiopian private commercial banks. Five hypotheses were formulated based on a comprehensive review of past literature. The study used primary sources of data through questionnaires. A cross-sectional survey design was employed, purposive sampling method was used and data were collected using structured questionnaires, with total of 168 questionnaires were distributed to internal auditors of all Private commercial banks, and 147 (a 87.5% response rate) had collected. The data was analyzed through with SPSS version 20 and regression analyses were carried out to examine the attributes of internal audit effectiveness. All of independent variables are making 60% explained internal audit effectiveness. The study found that there are significant positive relationships between the factors (Independence and objectivity of internal auditors, Competency of internal audit staffs, Existence of audit committees) and internal audit effectiveness. However, Organizational Setting and Management support have no significant effect on internal audit effectiveness. But, private commercial banks should understand that the contributions of these variables were collectively significant to identify any non-compliance activities in their office and to add values for the internal audit effectiveness. This study provides useful information to practitioners and academics who are interested in identifying the determinants of internal auditing effectiveness. Keywords : Internal audit effectiveness, independence and objectivity, organizational setting and Audit committees. DOI: 10.7176/EJBM/13-5-04 Publication date: March 31 st 2021

The Impact of Audit Committees on US Nonprofit Organizations’ Governance

All public companies in the United States are required by the securities and exchange commission (SEC) to have an audit committee. Such enforcement can be attributed to high-profile corporate failures and their connections to nonexistence, ineffective or weak audit committees and governance. Despite the efforts to establish a similar argument and enforcement structure for the nonprofit sector, the internal revenue service (IRS) has not pursued legislation, and no empirical evidence has been established to support any public policy changes. This paper contributes to the literature in this field by being the first study to examine 124,980 nonprofit organizations during the period of 2010 to 2015 to test the association between governance in nonprofit organizations and audit committees. We included fifteen measures from these organizations’ IRS Form 990 filings to formulate the study variables. We found significant evidence that the existence of audit committees improves the governance scores of nonprofit organizations. Our study findings have significant implications for nonprofit executives, policy makers and any other interested parties; these findings act as preliminary evidence to support more proactive policies regarding mandatory audit committees for nonprofit organizations

Pengaruh Audit Manajemen dan Pengendalian Intern Terhadap Penerapan Good Corporate Governance dan Implikasinya Terhadap Kinerja Perusahaan di Indonesia (Studi Empiris Pada 141 Perusahaan BUMN dalam Daftar CGPI yang Dirilis IICG Periode 2008-2013)

The implementation of Good Corporate Governance (GCG) principles on the State-owned companies has already shown increased. Nevertheless from several public view is still much stigma which the companies still laden with corruption and loss. The main objective of this study was to determine whether the management audit, internal control and application of the GCG principles affect the performance of state-owned companies . This study used a survey method using SEM analysis approach. The results showed that the management audit after on GCG has shown a lot of improvement . Similarly, the effect of internal control over the practice of good corporate governance has got a good assessment. The latter effect of corporate governance on corporates performance is viewed positively significant. Therefore , the importance of GCG implementation, the existence of audit committees and internal controls

Corporate Governance and Performance of Audit Committee and Internal Audit Functions in an Emerging Economy’s Public Sector

This article seeks to examine corporate governance and the performance of audit committee and internal audit functions in an emerging economy’s public sector. These two functions form a part of imperative corporate governance aspects, and their effective performance ensures better service delivery by public sector agencies. The study is premised on stakeholder theory, which has turned out to be the central point of public sector discourses. The study is based on qualitative content analysis, which aspires to present information about corporate governance and effectiveness of audit committees and internal audit units in South Africa’s public sector. The findings suggest that there is good corporate governance in terms of the existence of audit committees and internal audit functions in the public sector. However, the results suggest that the audit committees and internal audit units in South Africa’s public sector are not effective. Absence of advice, implementation of recommendations and inadequacy of resources have undermined the performance of audit committees and internal audit units in South Africa’s public sector. The leadership and other assurance bringers ought to consider the findings elevated by the audit committees and internal audit and execute their commendation. Their findings should be urbanised into action plans that are implemented by management. Audit committees must improve their oversight on internal audit functions so that both units would effectively perform. The subsistence of successful audit committee and internal audit components in the public sector certifies proficient and effectual exploitation of resources for the gain of all stakeholders.

The Impact of Audit Committees on US Nonprofit Organizations’ Governance

All public companies in the United States are required by the securities and exchange commission (SEC) to have an audit committee. Such enforcement can be attributed to high-profile corporate failures and their connections to nonexistence, ineffective or weak audit committees and governance. Despite the efforts to establish a similar argument and enforcement structure for the nonprofit sector, the internal revenue service (IRS) has not pursued legislation, and no empirical evidence has been established to support any public policy changes. This paper contributes to the literature in this field by being the first study to examine 124,980 nonprofit organizations during the period of 2010 to 2015 to test the association between governance in nonprofit organizations and audit committees. We included fifteen measures from these organizations’ IRS Form 990 filings to formulate the study variables. We found significant evidence that the existence of audit committees improves the governance scores of nonprofit organizations. Our study findings have significant implications for nonprofit executives, policy makers and any other interested parties; these findings act as preliminary evidence to support more proactive policies regarding mandatory audit committees for nonprofit organizations.

Risks Management and Corporate Performance of Business Enterprises in Jalingo Local Government, Taraba State

This study evaluated the relationship between risk management and corporate performance of Twenty (20) organization register with CAC in Jalingo Taraba state because Risk Management is an integrated framework and monitoring tool for managing uncertainties surrounding the business objectives. To achieve that, this objective was formulated. To provide empirical evidence of the extent to which RM framework has impacted performance in the business sector in Jalingo. The independent variables used were existence of risk management committee, the existence of financial expertise, the existence of audit committee, existence of Chief risk officer, and board size. The study data were sourced from annual reports and accounts of the selected enterprises. The collated data were analyzed using descriptive statistics and correlation matrix. The results reveal that risk management committee, financial expertise, audit committee, and board size have significant positive effect on performance. The result also shows that the existence of chief risk officer has a significant negative effect on performance. The study, therefore, recommended that the regulatory authorities and other relevant institutions are enjoined to reassess their supervisory role with the view to strengthen the RM process and taking the issue of risk management seriously at every level of organizations to provide reasonable assurance.

Assessment of Factors Affecting Audit Quality: “A Study of Selected Companies Listed on the Ghana Stock Exchange”

This study sought to establish the factors affecting audit quality in listed companies in Ghana. A cross-sectional method was used in the analysis in which a linear regression model was also used to establish the impact of the independent variables namely; auditor size, the existence of audit committee and the logarithm of the auditor fees on the independent variable audit quality. The logarithm of audit fees was taken to normalize the data. The dependent variable “leverage ratio” (total debts divided by total assets of the company) used to measure debt pressure by the companies and also used as a proxy for the audit quality because high debts in relation to company assets can lead to bankruptcy. Twenty- five (25) companies listed on the Ghana Stock exchange were used as the sample of the study. The results of the analysis indicated that logarithm of audit fees, existence of audit committee, and auditor size were all significant in influencing the leverage of the companies and thus audit quality. The size of audit firm had a negative impact on audit quality, while the companies that do not have audit committees are more likely to have poor audit quality. The logarithm of audit fees was positively related with the audit quality. It is recommended that audit fees should be regulated by The Institute of Chartered Accountants Ghana (ICAG) as well as taking action against audit companies which do not adhere to auditing standards and the officials of companies who are involved in misstating the financial statements and other financial records with the intention of concealing the true and actual facts of the financial position of the company.

Audit committee, internal audit function and earnings management: evidence from Jordan

PurposeThis study aims to examine the influence of audit committee existence and internal audit function on the earnings management of companies.Design/methodology/approachThis paper uses generalised least squares regression to investigate the influence of audit committee existence, internal audit function and the interaction of these two mechanisms on earnings management for a sample of 86 industrial companies listed on the Amman Stock Exchange over a four-year period from 2007 to 2010. The paper uses the extent of discretionary accruals as the proxy for earnings management.FindingsThis paper finds that audit committee existence and the internal audit function reduce the level of earnings management. The number of meetings between the audit committee and internal audit function also reduces discretionary accruals. Overall, this study finds that audit committee existence and internal audit function decrease earnings management and improve the financial reporting quality.Originality/valueThe main contribution of this study is that it investigates the combined effects of audit committee existence and internal auditors on earnings management. Furthermore, this study is the initial paper to examine the impact of audit committee and internal audit on earnings management in Jordan.

Fair value hierarchy in financial instruments disclosure - do audit committee and internal audit matter

This paper investigates the influence of audit committee (AC) and internal audit (IA) on fair value hierarchy (FVH) in financial instruments disclosure under the amendments made in March 2009 to IFRS 7 in Mauritius. Specific data on FVH was collected from the annual reports of the top 30 listed companies for the period 2010-2013. A disclosure index was then constructed, and the impact of AC and IA is investigated. Banks and insurance companies still need to improve the disclosure of FVH (particularly level 3 hierarchies) by 20%-25%. The existence of AC and the competence of its member(s) are statistically significant whereas its independence is moderately significant. The presence of IA function is positive but moderately significant whereas independence and competence are positively related but insignificant. This paper informs regulator(s), practicing accountants/auditors and professional associations on the effective influence of AC and IA on disclosure practices of FVH in financial instruments.

Analisa Faktor Yang Berpengaruh Terhadap Nilai Perusahaan Dengan Kualitas Laba Sebagai Variabel Intervening Pada Perusahaan Manufaktur

The purpose of this studi is to analyze of Factors that affect the Company Value with the Quality of profit as intervening variable on manufacture company on Manufacturing Companies Listed In Indonesia Stock Exchange. The results obtained as follows: Direct Influence Managerial ownership has a negative and significant effect on Corporate Value, Institutional ownership has a positive and significant effect on Corporate Value, Audit Committee existence has negative and insignificant effect on firm value. Indirect Effect is managerial ownership has a negative and insignificant effect on profit quality as well as earnings quality has positive and significant effect to company value, institutional ownership has negative and insignificant effect on profit quality and earnings quality have positive and significant influence to company value while existence of audit committee influences positive and significant to profitability as well as earnings quality have positive and significant impact to company value. Direct influence Managerial ownership of Corporate Value is greater than the indirect effect of managerial ownership on Corporate Value by mediating the quality of earnings so as to increase the Company's value of the selected direct path. It can be said that earnings quality can not function as intervening variable between managerial ownership and company value. The direct effect of Institutional Ownership on Corporate Value is greater than the indirect effect of Institutional Ownership on Corporate Values with the mediation of earnings quality, so as to increase the Company's value of selected direct paths. It can be said that earnings quality can not function as intervening variable between managerial ownership and company value. The Influence of Audit Committee's Existence on Corporate Value is less than indirect influence The existence of the Audit Committee on Corporate Values with the mediation of earnings quality so as to increase the Company's value is chosen indirect path. It can be said that earnings quality can serve as intervening variable between Audit Committee's existence with company value. Keywords: managerial ownership, institutional ownership, presence of audit committee, corporate value, earnings quality

Analysis of the Acceptance of Audit Opinion (A Case Study on Infrastructure, Utilities and Transportation Companies in Indonesia)

This study aims to determine the effect of corporate governance (CG) mechanisms and the size of the company on the acceptance of Fair with Exception (WDP) opinion. The population of this research is a number of 212 infrastructure, utility and transportation sector companies on the Indonesia Stock Exchange from 2012-2015. The sample was selected using purposive sampling and produced 88 observation units. The method of data used in this study is the logistic regression method. Data analysis shows two Corporate Governance mechanisms, namely the existence of the board of directors and the board of commissioners does not affect the acceptance of WDP opinion. On the other hand, the existence of independent commissioners and audit committees can influence the acceptance of WDP audit opinions. The conclusion of this study is that the presence of supporting bodies provides a positive injection for the company and affects the company’s accounting for the better.

Empirical Analysis of Joint Impact of Enterprise Risk Management and Corporate Governance on Firm Value

This paper analyzes simultaneity and endogeneity of ERM and Corporate Governance. It assesses quantitative relationship between Corporate Governance, ERM and value of the firm. The research results provide quantitative justifications for the boards to make investments in ERM and Corporate Governance initiatives for improved shareholder wealth. 3SLS-IV system modelling was applied on 2004-11 data of Gulf Cooperation Council financial institutions. Our research confirms the simultaneity and endogeneity of Corporate Governance, ERM and Firm Value determinants. Firm value is jointly and positively impacted by ERM & Corporate Governance initiatives although the impact was less significant. Unexpectedly, ERM initiative was significantly and negatively impacted by determinants such as intangibility, and profitability. Firm size was the only determinant that showed significant and positive impact on firm value. Relative to UAE the corporate governance mechanism was active in Bahrain, Saudi Arabia, Kuwait and Oman firms. Further, the existence of audit committees in the GCC firm’s boards and ERM adoption significantly positively impacted the corporate governance by 3.42% and 1.7239% respectively.
 Keywords: Corporate Governance, Enterprise Risk Management, Firm Value, Simultaneity, Endogeneity, Gulf Cooperation Council (GCC) economies.
 JEL codes: C15, C21, C51, D57, F30, G21, G32, G34, K22, L21, M31, M41, N25, O16

Pengaruh Struktur Corporate Governance Dan Risiko Perusahaan Terhadap Fee Audit

This study aims to analyze and provide empirical evidence of the influence of corporate governance structure and client risk towards audit fees. Corporate governance structure in this study uses the existence of independent commissioner, audit committee and majority shareholder. The bond ratings is used to measure client risk. This study uses secondary data from Indonesian Capital Market Directory (ICMD), annual reports, and bond ratings from PT. PEFINDO of companies which listed on Bursa Efek Indonesia in 2012-2013. This study uses purposive sampling method and resulted 104 firms. The method of analysis of this study used multi regression with SPSS 15.0. Program. The results indicate that corporate governance structure had no influence on audit fees, client risk have a positive influence on audit fees.

Enterprise Risk Management and Performance of Selected Listed Consumer Goods Companies in Nigeria

Enterprise Risk Management (ERM) is an integrated framework and monitoring tool for managing uncertainties surrounding the business objectives. This study evaluated the relationship between enterprise risk management and performance of Twenty (20) consumer goods companies listed on the Nigerian Stock Exchange. The independent variables used are existence of risk management committee, existence of financial expertise, existence of audit committee, existence of Chief risk officer and board size. The study adopted ex post facto research design and data were sourced from annual reports and accounts of the selected Consumer Goods Companies. The collated data were analysed using descriptive statistics and generalised least square. The results reveal that risk management committee, financial expertise and board size have significant positive effect on performance. The results also revealed that existence of audit committee has a significant negative effect on performance while existence of chief risk officer has no significant effect on performance. The study therefore recommended that the regulatory authorities and other relevant institutions are enjoined to reassess their supervisory role with the view to strengthen the ERM process and taking the issue of risk management seriously at every level of organisations to provide reasonable assurance.