The Substitution Role of Audit Committee Effectiveness and Audit Quality in Explaining Audit Report Lag
The Substitution Role of Audit Committee Effectiveness and Audit Quality in Explaining Audit Report Lag

Author: Husaini Saini Hasballah

Publisher:

Published: 2019

Total Pages: 10

ISBN-13:

DOWNLOAD EBOOK

Objective - This study aims to examine the relationship between audit committee effectiveness on Audit Report Lag (ARL), and the moderating effect of audit quality on the relationship between audit committee effectiveness and ARL. Methodology/Technique - 109 non-financial Indonesian listed companies are examined from 2012 to 2016. The data is analysed using multivariate regression analysis.Findings - The results show that audit committee effectiveness negatively affects ARL. This indicates that an effective audit committee can accelerate the delivery of audit reports. The results on the interaction between audit committee effectiveness and audit quality also negatively affects ARL. These results indicate that audit quality strengthens the influence of audit committees on the timeliness of financial reporting by reducing audit report lag.Novelty - The results show that there is a relationship of substitution between audit committee effectiveness and audit quality (Big-4) on ARL. The results of this study are consistent with agency theory which states that the implementation of corporate governance, such as an effective audit committee and audit quality, can improve the quality of financial reports.

Audit Committee Effectiveness and Internal Audit
Audit Committee Effectiveness and Internal Audit

Author: Fatimah Mat Yasin

Publisher:

Published: 2012

Total Pages: 210

ISBN-13:

DOWNLOAD EBOOK

Increased concerns regarding corporate accountability in various developed nations have been associated with the need for effective audit committee and internal control systems. This is due to large corporate collapses which have demonstrated problems with the quality of financial reporting and auditing. This study examines the nature and extent of the relationship between audit committee characteristics and internal audit function characteristics with audit quality whereby audit fee is used as a proxy for audit quality. The corporate governance characteristics included in this study are audit committee expertise, frequency of audit committee meetings, structure of internal audit function and size of internal audit function. This study applied the agency theory and resource dependence theory. This study also formulated eight hypotheses that guided the analysis and using publicly available information of 200 Malaysian public listed companies for the financial year end 2009 and 2010 each. This study provides recent evidence of a positive relationship between audit quality and two audit committee characteristics: audit committee with postgraduate qualification and frequency of audit committee meeting. Further, a positive relationship is found between audit quality and internal audit function characteristic, which is size of internal audit function. The results indicate firms that consist of more audit committee members with higher tertiary education and meets regularly with well-resourced internal audit units have a significant relationship with the audit quality. Apart from contributing to the literature on corporate governance and audit quality, this study may serve as an input for the regulator to encourage strict enforcement for Malaysian-listed companies to incorporate corporate governance practices especially on audit committee composition and internal audit function.

Audit Committee Effectiveness
Audit Committee Effectiveness

Author: Stuart Turley

Publisher:

Published: 2008

Total Pages: 31

ISBN-13:

DOWNLOAD EBOOK

Purpose of this paper - This paper seeks to investigate the conditions and processes affecting the operation and potential effectiveness of audit committees, with particular focus on the interaction between the audit committee, individuals from financial reporting and internal audit functions and the external auditors. Design/methodology/approach - A case study approach is employed, based on direct engagement with participants in audit committee activities, including the audit committee chair, external auditors, internal auditors, and senior management.Findings - We find that informal networks between audit committee participants condition the impact of the audit committee and that the most significant effects of the audit committee on governance outcomes occur outside the formal structures and processes. An audit committee has pervasive behavioural effects within the organization and may be used as a threat, an ally and an arbiter in bringing solutions to issues and conflicts. Audit committees are used in organizational politics, communication processes and power plays and also affect interpretations of events and cultural values. Research limitations/implications - Further research on audit committee and governance processes is needed to develop better understanding of effectiveness. Longitudinal studies, focusing on the organizational and institutional context of audit committee operations, can examine how historical events in an organization and significant changes in the regulatory environment affect current structures and processes.Originality/value - The case analysis highlights a number of significant factors which are not fully recognised either in theorizing the governance role of audit committees or in the development of policy and regulations concerning audit committees but which impinge on their governance contribution. They include (i) the importance of informal processes around the audit committee; (ii) its influence on power relations between organizational participants; (iii) the relevance of the historical development of governance in an organization; (iv) and the possibility that the audit committee's impact on governance may be greatest in non-routine situations.

The Impact of Audit Committee Effectiveness on Audit Report Lag
The Impact of Audit Committee Effectiveness on Audit Report Lag

Author: Mohamed Ali Hussein Al-Muzaiqer

Publisher:

Published: 2016

Total Pages: 166

ISBN-13:

DOWNLOAD EBOOK

The objective of this study is to investigate the audit report lag (ARL) in the United Arab Emirates (UAE) and the impact of the audit committee’s effectiveness on the ARL. The characteristics of the audit committee studied include the size of audit committee, its expertise and the audit committee meetings. The study will test whether there is a link between the characteristics of an audit committee and the ARL. The ARL is measured by the number of days between the date of the financial year end and the date of the audit report. The agency theory is applied to explain the hypotheses in this study. The sample of study consist of 149 listed companies on the Abu Dhabi Securities Exchange (ADX) and the Dubai Financial Market (DFM) for three years from 2011 to 2013. The regression analysis is performed to investigate the ARL determinants. The results show that the ARL is influenced by the size of audit committee, auditor type and firm profitability. However, no evidence is found to support the effect of the expertise of the audit committee, audit committee meetings, firm size and industry type on ARL. Detailed explanation of the results with its implications, limitations and suggestions for future research are also addressed.

Audit Committee Formation in the Aftermath of 2007-2009 Global Financial Crisis, Volume II
Audit Committee Formation in the Aftermath of 2007-2009 Global Financial Crisis, Volume II

Author: Zabihollah Rezaee

Publisher: Business Expert Press

Published: 2016-07-08

Total Pages: 190

ISBN-13: 1631571559

DOWNLOAD EBOOK

The audit committee has gained considerable attention in the aftermath of 2007-2009 global financial crisis. The audit committee’s role has evolved from a voluntary liaison between management and external auditors to the standing committee of the board of directors in overseeing all aspects of corporate governance, financial reporting, internal controls, risk assessment, and audit activities. This book addresses the determinants of audit committee oversight effectiveness, including their composition, independence, authority, resources, diligence, and activities. The book is organized into three separate volumes and each volume can be utilized separately or in an integrated form. The first volume consists of five chapters, which examine the relevance and fundamentals of the audit committees as well as the determinants of audit committee effectiveness. The second volume consists of nine chapters on financial, auditing, internal control, risk management, ethics and compliance, antifraud, and other oversight functions of the audit committee. The third volume consists of five chapters on the emerging issues of audit committees pertaining to evaluation, education, reporting, and accountability as well as audit committees of private companies, governmental entities and not-for-profit organizations.

Audit Committee's Effectiveness and Financial Reporting Quality
Audit Committee's Effectiveness and Financial Reporting Quality

Author: Nurul Nazlia Jamil

Publisher: LAP Lambert Academic Publishing

Published: 2012-04

Total Pages: 92

ISBN-13: 9783847336785

DOWNLOAD EBOOK

Financial reporting quality has been under scrutiny especially after the collapse of major companies. The main objective of this study is to investigate the audit committee's effectiveness on the financial reporting quality among the Malaysian GLCs. In particular, the study examined the impact of audit committee characteristics (independence, size, frequency meeting and financial expertise) on earnings management in periods prior to and following the transformation program (2003-2009). The study is important as it provides additional knowledge about the impact of audit committee's effectiveness on reducing the earnings management, and assist practitioners, policymakers and regulators such as Malaysian Institute of Accountants, Securities Commission and government to determine ways to enhance audit committee's effectiveness and improve the financial reporting of GLCs, as well as improving the quality of the accounting profession.

The Audit Committee: Performing Corporate Governance
The Audit Committee: Performing Corporate Governance

Author: Laura F. Spira

Publisher: Springer Science & Business Media

Published: 2007-05-08

Total Pages: 191

ISBN-13: 030647655X

DOWNLOAD EBOOK

Why do we need to understand audit committees? The Cadbury Committee recommended that UK companies should adopt them in response to financial scandals that have stemmed from dubious financial reporting practices. In other countries, similar commissions have made similar recommendations and audit committees are now a common institution. However, many practitioners doubt whether an audit committee really does much to ensure the integrity of a firm's financial statements because, as outsiders, members don't know enough to dig deeply beneath the numbers. The Audit Committee: Performing Corporate Governance argues that such criticism overlooks the ceremonial function of these committees. The audit committee is an arena where members can form and strengthen shifting and fragmentary networks with each other and with the external auditors. Within these networks, both consensus and independence are demonstrated, generating comfort, which legitimises the company and maintains its access to external sources of capital. The audit committee is a key part of the corporate governance structure within an organisation. Many in the UK have been patched together to meet regulatory requirements and their operation is poorly understood because few people other than their members have access to their deliberations. In this account of the world of audit committees the practitioner will find the ethnographical perspectives on ceremonial performance, consensus, independence, and comfort both familiar and different. It's like looking at a photograph of something commonplace from an unusual angle or through a strange-shaped lens.