scholarly journals Umhverfi og starfsemi endurskoðunarnefnda – bakgrunnur nefndarmanna og traust á fjárhagsupplýsingum

2017 ◽  
Vol 14 (1) ◽  
pp. 25
Author(s):  
Einar Guðbjartsson ◽  
Jón Snorri Snorrason
Keyword(s):  
Financial Reporting ◽  
Public Interest ◽  
Audit Committee ◽  
High Reliability ◽  
Financial Information ◽  
Audit Committees ◽  
High Quality ◽  
Financial Reports ◽  
Gender Education ◽  
Definition Of

The aim of this paper is to report partial results of a study on the environment and practices of audit committees in Iceland. The findings of two surveys, one from 2012 and the other from 2016, are compared. The paper identifies, among other things, education of committee members, reliance on financial informatin and the emphasis of audit committees. In the Annual Accounts Act, no. 3/2006, it is required for certain legal entities, public interest entities, according to the Act of Auditors, no. 79/2008, to establish an Audit Committee. The purpose of the audit committee is to ensure the high quality and high reliability of financial reporting and financial information. It does not matter whether the reports are for the administrators of the entity or the stakeholders outside the entity. The Annual Accounts Act, no. 3/2006, provides that the board constitute an audit committee. The aim of this paper is to disclosure partition of gender, education of members and changes in trust regarding financial reports according to audit committee’s members. The surveys were done among the leading companies and institutions of Iceland (which fall within the definition of “public interest entities”). The overall view is how audit committee´s issues are handled. This is the first study of its kind, which specifically look at committees in Iceland.

Die öffentliche Funktion des Prüfungsausschusses

2019 ◽  
Author(s):  
Nora Schaffer
Keyword(s):  
Financial Reporting ◽  
Public Interest ◽  
Audit Committee ◽  
Supervisory Board ◽  
Balance Of Power ◽  
Audit Committees ◽  
State Supervision ◽  
Government Supervision ◽  
Supervisory Boards

The audit committee of public interest entities performs a public function through its auditing of financial reporting, which can be broadly broken down into three facets: (i) its role of relieving the burden on the state by supplementing or replacing government supervision, (ii) its role as guarantor of the capital market’s confidence and (iii) its role as guarantor of an audit and thus as the ‘guarantor of the guarantor’. This public function is emphasised by the recent introduction of hitherto non-systemic state supervision of supervisory boards and audit committees. This supervision is, however, to be viewed critically as it could result in the beginnings of ‘stock authorities’. This study examines how the aforementioned public function radiates to the other supervisory bodies in companies, namely the auditor and the supervisory board. It also examines the dangers which European strengthening of audit committees pose to corporate governance based on the dualistic system and to the balance of power in public limited companies.

AN 1870 CORPORATE AUDIT COMMITTEE

1979 ◽  
Vol 6 (2) ◽  
pp. 61-68 ◽  
Author(s):  
Thomas E. McKee
Keyword(s):  
Nineteenth Century ◽  
Board Of Directors ◽  
Audit Committee ◽  
Financial Information ◽  
Audit Committees ◽  
Common Goal ◽  
Accounting Profession ◽  
Public Accounting ◽  
Financial Reports ◽  
The U.S

Board of directors' audit committees are becoming an increasingly popular vehicle for enhancing the objectivity and independence of auditors and overseeing the financial information generating process. This is occurring at a time when directors and auditors are facing criticism and increased litigation due to corporate failures and disclosures of illegal or questionable payments. This article examines the workings of a corporate audit committee that operated in the mid-nineteenth century. The committee functioned as “auditor” for the company since there was no established public accounting profession in the U.S. at that time. They disentangled the financial affairs of the company and probably directly contributed to the replacement of the President of the company. Although the activities of corporate audit committees have changed or evolved considerably through the years, both the 1870 corporate audit committee and modern corporate audit committees have pursued a common goal of achieving accuracy and completeness in corporate financial reports.

Evaluating Financial Reporting Quality: The Effects of Financial Expertise vs. Financial Literacy

2002 ◽  
Vol 77 (s-1) ◽  
pp. 139-167 ◽  
Author(s):  
Linda McDaniel ◽  
Roger D. Martin ◽  
Laureen A. Maines
Keyword(s):  
Financial Reporting ◽  
Financial Literacy ◽  
Audit Committee ◽  
Reporting Quality ◽  
Audit Committees ◽  
Financial Reporting Quality ◽  
Financial Reports ◽  
Business Press ◽  
Financial Expertise

Audit committees evaluate financial reporting quality as part of their corporate oversight responsibilities. Given this responsibility, the national stock exchanges now require all audit committee members to be financially literate and at least one member to have financial expertise. In light of recent debates over this requirement, we provide evidence on how experts and literates differ in their evaluations of financial reporting quality. Results suggest that experts' evaluations of financial reporting quality are more strongly associated with their assessments of characteristics underlying reporting quality (e.g., relevance) espoused in Statement of Financial Accounting Concepts No. 2's framework than literates' evaluations. Additionally, literates are more likely than experts to identify concerns about reporting treatments for business activities that are prominent in the business press or are distinguished by their nonrecurring nature, while experts are more likely to raise concerns about reporting treatments for less prominent, recurring activities. This same pattern occurs in the ratings of the quality of the reporting treatments for specific financial statement items with respect to elements underlying reporting quality (e.g., neutrality); literates (experts) assess the quality elements for the reporting treatments of prominent and nonrecurring items (less prominent and recurring items) comparatively lower than experts (literates). These results suggest that including financial experts on audit committees is likely to change the structure and focus of audit committee discussions about financial reporting quality, and may affect the committee's overall assessment of the quality of a company's financial reports.

scholarly journals Timeliness of financial reporting and audit committee effectiveness: evidence from UAE

2018 ◽  
Vol 1 (1) ◽  
Author(s):  
Mohammed Ali Almuzaiqer
Keyword(s):  
United Arab Emirates ◽  
Financial Reporting ◽  
Capital Markets ◽  
Audit Committee ◽  
Listed Companies ◽  
Audit Committees ◽  
Audit Report ◽  
Financial Reports ◽  
Code Of Corporate Governance ◽  
The Impact

ABSTRACT Purpose – This study aims to examine the contemporary timeliness of financial reporting in the United Arab Emirates (UAE), and the impact of audit committee effectiveness on this timeliness. Design/Methodology/Approach – Timeliness of financial reporting in this study is measured by audit report lag (ARL), which is the number of days between the date of the financial year end and the date of the audit report. The data from listed companies on the UAE capital markets; Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM), for three years from 2011 to 2013 resulted in 298 observations. The main statistical techniques of the study are means and multiple regressions. Findings – The findings show that generally all companies meet the submission deadlines imposed by the two UAE markets. Furthermore, ARL is influenced by audit committee size and profitability, while no evidence is found to support the effect of audit committee expertise, audit committee meetings and firm size on ARL. Practical Implications – The results of the study show that only audit committee size has a significant influence in reducing ARL. This may be attributed to having minimal variation in the implementation of the Code of Corporate Governance (CCG), particularly audit committee attributes, in the UAE. The results suggest that the current governance by audit committees is adequate to ensure that the financial reports of companies in the UAE are timely. However, except for audit committee size, the other audit committee attributes are unable to further shorten ARL.   Originality/Value –The capital markets in the UAE and its CCG are relatively new. Hence, regulatory requirements may be less stringently implemented by companies in this country. Consequently, timely audited financial reports are demanded by local and international investors to make decisions and alleviate speculation. Thus, determining audit committee attributes that reduce ARL is beneficial to the UAE markets, the listed companies and investors.     Keywords Audit report lag (ARL), Financial reporting timeliness, Audit committee, UAE Paper Type: Research paper

scholarly journals The Impact Of Audit Committees Personal Characteristics On Earnings Management: Evidence From China

2012 ◽  
Vol 28 (6) ◽  
pp. 1331-1344 ◽  
Author(s):  
Baolei Qi ◽  
Gaoliang Tian
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Audit Committee ◽  
Personal Characteristics ◽  
Audit Committees ◽  
Publicly Traded ◽  
Upper Echelons Theory ◽  
Gender Education ◽  
The Impact

This study investigates the influence of audit committees personal characteristics on the firms earnings management behavior using Chinas publicly traded firms during 2004-2010. Overall, our findings suggest that audit committees several personal characteristics, such as age, gender, education level, and working experience, are associated with earnings management, which in turn may affect the quality of financial reporting. The results are robust after controlling the size, independence, meeting frequency of audit committee, and other firm specific characteristics. The results are consistent with the predictions based on the Upper Echelons Theory. The contributions to the earnings management literature and implications for regulators and investors are also discussed.

scholarly journals Анализа ефективности одбора за ревизију у процесу надзора финансијског извјештавања на примјеру компанија у Црној Гори // Analysis of the effectiveness of the Аudit Committee in the financial reporting oversight process in montenegrin companies

2014 ◽  
Vol 12 (20) ◽  
pp. 243
Author(s):  
Тања Лаковић
Keyword(s):  
Board Of Directors ◽  
Financial Reporting ◽  
Audit Committee ◽  
Banking Sector ◽  
Audit Committees ◽  
Real Economy ◽  
External Audit ◽  
Financial Reports ◽  
Proactive Approach ◽  
Regulatory Bodies

Резиме: Успостављање и ефективно функционисање одбора за ревизију представља један од видова јачања повјерења стејкхолдера у погледу дјелотворнијег надзора одбора директора над активностима менаџмента у процесу финансијског извјештавања, ревизијe финансијских извјештаја компанија, као и у погледу надзора над радом интерне и екстерне ревизије. Колико је одбор за ревизију ефективан у раду, у великој мјери зависи од начина на који је одбор конституисан и самих активности и иницијатива његових чланова у испуњавању додијељених им надлежности.Основни циљ рада је да се оцијени ефективност одбора за ревизију у црногорским компанијама у периоду од 2009 до 2011. године. У фокусу истраживања су компаније у реалном и банкарском сектору и сектору осигурања. Прикупљање података за оцјену ефективности одбора за ревизију црногорских компанија извршено је на основу анкетног упитника.Резултати истраживања указују на растући тренд у погледу оснивања и функционисања одбора за ревизију, што се прије свега може приписати пооштравању регулаторних захтјева и активности регулаторних тијела. Истраживање потврђује да компаније у банкарском сектору имају највећи ниво ефективности одбора за ревизију у односу на компаније у осталим посматраним секторима.Summary: One of the indicators of strengthening the confidence of stakeholders in terms of supervision of Board of Directors over the work of management in the process of financial reporting, in the process of audit of company’s financial reports and supervision over the internal and external audit is the establishing and effective functioning of the Audit Committee. The effectiveness of  Audit Committee in fulfilling it’s responsibilities, largely depends on the way the Committee is constituted and the activities and initiatives of it’s members in fulfilling the authorities given to them.Basic goal is to evaluate the effectiveness of the Audit Committee in Montenegrin companies in period from year 2009 to year 2011. In the focus of the research are companies from real economy sector, banking and insurance. The data for evaluation of the Montenegrin companies’ audit committees effectiveness has been collected through questionnaire.Results of the research indicate growing trend when it regards the establishing and functioning of the Audit Committee in Montenegrin companies, which is the consequence of sharpening the regulatory demands and the proactive approach of regulatory bodies. The research proves that companies from the banking sector show significantly higher level of effectiveness regarding the functioning of the audit committees than the companies in other sectors.

Did the 1999 NYSE and NASDAQ Listing Standard Changes on Audit Committee Composition Benefit Investors?

2017 ◽  
Vol 92 (6) ◽  
pp. 187-212 ◽  
Author(s):  
Seil Kim ◽  
April Klein
Keyword(s):  
Financial Reporting ◽  
Audit Committee ◽  
Research Question ◽  
Reporting Quality ◽  
Audit Committees ◽  
Financial Reporting Quality ◽  
Difference In Differences ◽  
Listed Firms ◽  
Sarbanes Oxley ◽  
Independent Audit

ABSTRACT In December 1999, the SEC instituted a new listing standard for NYSE and NASDAQ firms. Listed firms were now required to maintain fully independent audit committees with at least three members. In July 2002, the U.S. Congress legislated these standards through the Sarbanes-Oxley Act. Our research question is whether all investors benefited from the 1999 new rule. Using both an event study and a difference-in-differences methodology, we find no evidence of higher market value or better financial reporting quality resulting from this rule.

scholarly journals Corporate Social Responsibility, Audit Committee Expertise, and Financial Reporting: Empirical Evidence from Korea

2021 ◽  
Vol 13 (19) ◽  
pp. 10517
Author(s):  
Haeyoung Ryu ◽  
Soo-Joon Chae ◽  
Bomi Song
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Financial Reporting ◽  
Audit Committee ◽  
Earnings Quality ◽  
Audit Committees ◽  
Accounting Expertise ◽  
Corporate Social

Corporate social responsibility (CSR) involves multiple activities and is influenced by the cultural and legal environment of the country in which a firm is located. This study examines the role of audit committees’ (AC) financial expertise in the relationship between CSR and the earnings quality of Korean firms with high levels of CSR. Using a multivariate analysis, it investigates whether the ACs that include members with accounting expertise, finance expertise, or supervisory expertise individually affect a firm’s decision making. It also examines how ACs with diverse expertise contribute toward improving the financial reporting quality of firms with high levels of CSR. The results demonstrate that when there is a certified accountant in the AC of a firm that practices CSR based on ethical motivation, the earnings management through discretionary accruals is more strictly controlled. This is more effective when the AC comprises members with accounting and non-accounting expertise. This finding implies that the AC plays a positive role in improving the accounting information quality of firms with CSR excellence. Moreover, while the role of accounting experts in the AC is important for maintaining high earnings quality, combining other types of expertise creates synergy.

scholarly journals An Investigation on the Audit Committees Effectiveness: The Case for GLCs in Malaysia

2011 ◽  
Vol 13 (3) ◽  
pp. 287 ◽  
Author(s):  
Nurul Nazlia Jamil ◽  
Sherliza Puat Nelson
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Audit Committee ◽  
Reporting Quality ◽  
Audit Committees ◽  
Financial Reporting Quality ◽  
Financial Expertise ◽  
Monitoring Mechanism ◽  
The Impact

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 following the transformation program. In particular, the study examined the impact of audit committee characteristics (independence, size, frequency of meeting and financial expertise) on earnings management in periods prior to and following the transformation program (2003-2009). As of 31 December 2010, there were 33 public-listed companies categorized as Government-Linked Companies (GLC Transformation Policy, 2010) and there were 20 firms that have complete data that resulted in the total number of firm-year observations to 120 for six years (years 2003-2009).  Results show that the magnitude of earnings management as proxy of financial reporting quality is influenced by the audit committee independence. Agency theory was applied to explain audit committee, as a monitoring mechanism as well as reducing agency costs via gaining competitive advantage in knowledge, skills, and expertise towards financial reporting quality. The study is important as it provides additional knowledge about the impact of audit committees 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 committees effectiveness and improve the financial reporting of GLCs, as well as improving the quality of the accounting profession.     

scholarly journals Do audit committee characteristics of Bahraini listed companies have an effect on the level of internet financial reporting?

2016 ◽  
Vol 13 (3) ◽  
pp. 131-147 ◽  
Author(s):  
Sara AbdulHakeem Saleh AlMatrooshi ◽  
Abdalmuttaleb M. A. Musleh Al-Sartawi ◽  
Zakeya Sanad
Keyword(s):  
Corporate Governance ◽  
Literature Review ◽  
Financial Reporting ◽  
Audit Committee ◽  
Positive Relationship ◽  
Listed Companies ◽  
Financial Information ◽  
The Internet ◽  
Regression Test ◽  
The Relationship

Corporate Governance and IFR are influential topics that need to be addressed nowadays due to its importance. Especially since companies are growing and extending globally. This research is conducted in Kingdom of Bahrain through the year 2014, where it investigates the relationship between Audit Committee characteristics as a tool of CG and IFR. Literature review has been conducted, not to mention Multi-regression test was used to evaluate the relationship between Audit Committee characteristics and IFR for Bahraini listed companies. The results have showed that the relationship between Audit Committee characteristics and IFR is negative, which indicates that the Audit committee characteristics have no influence over the disclosure of financial information over the internet. However, Frequency of meeting of the board and Big4 resulted in a positive relationship with internet financial reporting. The study ends with a main conclusion and recommendation that contain certain steps and advices of disclosing financial information in an appropriate way through the internet in order to improve the relationship between Audit committee characteristics and IFR.

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