scholarly journals Internal Control, External Audit and Corporate Cash Flow Risk

2021 ◽  
Vol 292 ◽  
pp. 02016
Author(s):  
Wanting Liu ◽  
Qianyu Zhao ◽  
Gang Fu
Keyword(s):  
Cash Flow ◽  
Internal Control ◽  
Listed Companies ◽  
Governance Mechanisms ◽  
High Quality ◽  
External Audit ◽  
External Resources ◽  
External Governance ◽  
Cash Flow Risk ◽  
The Impact

Based on the sample of A-share listed companies in Shanghai and Shenzhen from 2014 to 2019, this paper empirically tests the impact of internal control and external audit on corporate cash flow risk and the interaction between the two in affecting cash flow risk. The results show that high-quality internal control and external auditing can independently reduce corporate cash flow risks, and the two play a substitute effect in this process. The research conclusions expand the impact of the company’s internal and external governance mechanisms on cash flow risks, and are of great significance for companies to effectively use internal and external resources to prevent and manage cash flow risks.

scholarly journals Analysis on financing structure and default probability of listed companies

2021 ◽  
Vol 292 ◽  
pp. 02032
Author(s):  
Xiangyun Luo ◽  
Miao Luo
Keyword(s):  
Cash Flow ◽  
Default Risk ◽  
Listed Companies ◽  
Mediating Effect ◽  
Default Probability ◽  
Probability Of Default ◽  
Financing Structure ◽  
Debt Default ◽  
Cash Flow Risk ◽  
The Impact

This paper studies the relationship between the financing structure and the probability of default of A-share listed companies from 2001 to 2020. The purpose is to prevent the occurrence of default and ensure the healthy development of various industries. It is found that the higher the proportion of external financing is, the higher the probability of default is. The impact of debt financing on default risk is higher than equity financing. In addition, this paper tests the mediating effect of cash flow risk, and the effect of financing structure on debt default probability is heterogeneous among regions and enterprises. These findings show that enterprises must control their financing structure, optimize the allocation of resources, prevent cash flow risk, reduce the probability of debt default, so as to make various industries flourish and optimize the industrial structure.

scholarly journals A study of the impact of information disclosure quality on the efficiency of corporate investment—Based on civil engineering listed companies

2020 ◽  
Vol 198 ◽  
pp. 03032
Author(s):  
Liying Zhang
Keyword(s):  
Life Cycle ◽  
Civil Engineering ◽  
Listed Companies ◽  
Investment Efficiency ◽  
Disclosure Quality ◽  
High Quality ◽  
Life Cycle Stages ◽  
Quality Disclosure ◽  
The Impact

Most of the existing studies on the impact of disclosure quality of listed companies on the investment efficiency of enterprises are based on the static level, and the article investigates the evolution of disclosure quality on the investment efficiency of enterprises from the dynamic level by dividing the life cycle of enterprises. Taking the data of Shenzhen civil engineering companies from 2013-2017 as the research sample, it uses multiple regression analysis to empirically test the impact of disclosure quality of listed companies on the investment efficiency of enterprises at different life cycle stages. The results show that when no distinction is made between life cycle stages, high quality disclosure can significantly inhibit the inefficient investment behavior of firms; in the growth and maturity samples, high quality disclosure can significantly inhibit underinvestment and overinvestment; in the recessionary samples, high quality disclosure can significantly inhibit underinvestment and has no significant effect on overinvestment.

scholarly journals The Impact of Corporate Governance on Working Capital Management Efficiency: Evidence from the Listed Companies in the Consumer Services Sector in Botswana

2018 ◽  
Vol 10 (12) ◽  
pp. 135
Author(s):  
Sathyamoorthi C. R. ◽  
Christian J. Mbekomize ◽  
Mogotsinyana Mapharing ◽  
Popo Selinkie
Keyword(s):  
Corporate Governance ◽  
Listed Companies ◽  
Capital Management ◽  
Working Capital ◽  
Governance Mechanisms ◽  
Working Capital Management ◽  
Management Efficiency ◽  
Corporate Governance Mechanisms ◽  
The Impact ◽  
Moderate Relationship

The paper presents the findings of the analysis of the impact of corporate governance mechanisms on working capital management efficiency in the listed companies of the Consumer service sector in Botswana. Eight corporate governance elements and seven working capital components were extracted from the annual reports of a sample of six companies for the period 2012 to 2017 for the analysis. Thirty six observations were obtained. Pearson correlations were executed to determine the relationship between corporate governance elements and working capital components. OLS regression analysis was performed to establish the explaining power of the combination of corporate governance elements on each of the working capital components. The correlation analysis shows that number of non-executive directors has a significant negative but moderate relationship with cash conversion cycle and number of board subcommittees has significant positive but moderate relationship with Debt ratio. The regression results suggest that corporate governance mechanisms have a significant impact on working capital management, the highest impact being reflected on inventory conversion period. The implications of these findings are that boards of directors have a significant role to play in working capital management efficiency of the companies they govern. They should therefore continue providing attainable policies on working capital management and remain vigilant on demanding feedback on their implementations.

scholarly journals The role of effective audit committee in strengthening the financial reporting: Evidence from Jordanian listed companies

2012 ◽  
Vol 9 (3) ◽  
pp. 59-68 ◽  
Author(s):  
Mo’taz Amin Al-Sa’eed ◽  
Soud M. Al-Mahamid
Keyword(s):  
Financial Reporting ◽  
Internal Control ◽  
Audit Committee ◽  
Internal Audit ◽  
Listed Companies ◽  
International Standards ◽  
Future Research ◽  
External Audit ◽  
Cross Sectional ◽  
Study Results

This study aims to understand the features of an effective audit committee and its role in strengthening financial reporting. A questionnaire based survey was circulated to public listed companies on the Amman Stock Exchange (Banking, insurance, and financial institutions). The study was aimed at internal audit managers and finance managers. Out of 156 questionnaires, we received 110 back which represents a 71% response rate. The study results show that the research respondents have a good level of education and experience. In addition, there is a relationship between internal controls, international standards on auditing, institute of internal audit; Jordan securities commission requirements, external audit, understanding of audit committee functions, and financial reporting. Furthermore, the internal control, international standard on auditing and institute of internal audit, Jordan securities commission requirements, External audit, understanding of audit committee functions can explain a significant amount of the variability in financial reporting. Finally, the research results also show that age and gender make a difference for our respondents when they evaluate financial reporting. The study like other cross sectional studies is not free of limitations. Managerial implications and new avenues of future research are supplied. Future research also can borrow the research model and apply a longitudinal study to solve the cross sectional study problems.

scholarly journals The Impact Of Cash Flow Information On The Forecasts Provided By Financial Analysts, Considering The Quality Of Earnings

2011 ◽  
Vol 19 (1) ◽  
Author(s):  
Sylvie Deslauriers
Keyword(s):  
Cash Flow ◽  
Financial Analysts ◽  
Font Size ◽  
High Quality ◽  
Future Earnings ◽  
Flow Information ◽  
The Impact

<p class="MsoNormal" style="text-align: justify; margin: 0in 36.1pt 0pt 0.5in; mso-pagination: none;"><span style="font-family: &quot;Times New Roman&quot;,&quot;serif&quot;; font-size: 10pt; mso-bidi-font-style: italic; mso-ansi-language: EN-CA;" lang="EN-CA">In the present study, the impact of publishing more precise and better-structured cash flow information on financial analysts&rsquo; forecast will be examined<span style="color: blue;">.<span style="mso-spacerun: yes;">&nbsp; </span></span>Even though the change in standards presently under study may be principally deemed to be cosmetic, it does appear to have allowed financial analysts to generate more accurate forecasts of future earnings. An increase in the dispersion of these forecasts, more especially when dealing with enterprises providing a high quality of earnings, is also noted. </span></p>

Information Technology Controls Quality and Audit Fees: Evidence From Italy

2016 ◽  
Vol 33 (1) ◽  
pp. 123-146 ◽  
Author(s):  
Tatiana Mazza ◽  
Stefano Azzali
Keyword(s):  
Risk Assessment ◽  
Information Technology ◽  
Financial Reporting ◽  
Internal Control ◽  
Audit Fees ◽  
Listed Companies ◽  
Audit Risk ◽  
The Impact ◽  
Control Risk

This study analyzes the impact of Information Technology (IT) Controls quality on control risk and audit fees. The impact is expected to occur when regulation increases sensitiveness to audit risk assessment. The research focuses on IT Controls as part of Internal Control over Financial Reporting, particularly on scoping quality, segregation of duties, and Controls framework compliance. The research was conducted with a questionnaire on a population of Italian listed companies. We find that audit fees are lower for higher IT scoping quality, IT Controls segregation of duties, and IT Controls framework compliance. The overall conclusion is that IT Controls quality is related to lower control risk, audit fees, and audit effort.

scholarly journals High-Speed Railway Opening and Corporate Fraud

2021 ◽  
Vol 13 (23) ◽  
pp. 13465
Author(s):  
Chen Wang ◽  
Jack Strauss ◽  
Lei Zheng
Keyword(s):  
Internal Control ◽  
Information Disclosure ◽  
High Speed ◽  
Market Competition ◽  
Control Level ◽  
Listed Companies ◽  
Inhibitory Effect ◽  
High Speed Railway ◽  
Corporate Fraud ◽  
The Impact

The impact of high-speed railway (HSR) on corporate behavior has recently attracted both practical and theoretical interest. In this paper, based on a sample of A-share listed companies from 2007 to 2020 in China, we use a difference-in-difference model to explore the impact of HSR openings on corporate fraud and analyze its mechanism. We find that HSR introduction has several important implications. First, it reduces the tendency and frequency of corporate fraud. Second, HSR opening restrains corporate fraud by improving the external supervision level and reducing the financing constraints of the company. Third, the inhibitory effect of the HSR opening on corporate fraud is significant when the market competition is less intense, and the company’s internal control level is poor. Fourth, after distinguishing types of fraud, HSR opening can still significantly inhibit information disclosure fraud and manager fraud, but not operation fraud. These results indicate that HSR openings promote the flow of information and labor across regions, alleviating the information asymmetry of firms. Our findings are conducive to improving the governance environment of the listed companies, which provides new clues for discovering and restricting corporate fraud.

scholarly journals An Analysis of Internal Audit Investment Among Top Malaysian Listed Companies

2019 ◽  
Author(s):  
Mohamad Naimi Mohamad Nor ◽  
Suhaimi Ishak
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Audit Committee ◽  
Economies Of Scale ◽  
Internal Audit ◽  
Listed Companies ◽  
Future Research ◽  
External Audit ◽  
Internal Audit Function ◽  
Code Of Corporate Governance

The importance of internal audit function in improving the company’s internal control risk management and corporate governance has been emphasized in the Malaysian Code of Corporate Governance (MCCG) and Bursa Malaysia Listing Requirements. Based on the Listing Requirements, Malaysian listed companies are required to establish the internal audit function, which is independent and this function must be supervised by the audit committee. Although the importance of internal audit function has been highlighted in various code of corporate governance, little is known about the investment made by the company in internal audit activity. This study capitalizes the publicly available data on internal audit cost and the type of internal function provider in Malaysia setting. The primary purpose of this study is to describe internal audit practices, especially on the internal audit budget in Malaysia for the year 2017 for top 300 companies. Based on the descriptive analysis, it is found that the internal audit fee is relatively lower than the cost of external audit and most of the companies’ internal audit function was carried out by in house teams. Also, the benefit from economies of scale is less pronounced in internal audit as compared to external audit services. Some further analyses were also conducted, and the article is ended recommendations for future research to be undertaken in investigating the internal importance audit in Malaysia.

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