Audit committee financial expertise and earnings quality: A meta-analysis

Bilal, B; Chen, Songsheng; Komal, Bushra

doi:10.1016/j.jbusres.2017.11.048

Cited by 131 publications

(137 citation statements)

References 93 publications

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“…This means that managerial shareholders are essential for enhancing corporate investments (Mykhayliv & Zauner, 2017), and for offsetting market inefficiency (Nakabayashi, 2019). The finding of this study is in tandem with Bilal et al (2018) and Bryce et al (2015) who showed the link between the audit committee and EQ with the IFRS adoption. This result is also consistent with the Agency theory which suggests that shareholders incurred monitoring expenses, i.e.…”

Section: The Moderating Effect Of Ifrs Adoptionsupporting

confidence: 67%

“…Prior literature had stated that IFRS adoption can do several things: 1) mitigate earnings management practices (Bilal, Chen, & Komal, 2018), 2) protect minority shareholders (Hong, 2013), and 3) increase firm financial performance (Kouaib & Jarboui, 2017). The IFRS is an important mechanism that helps firms to improve the monitoring ability of their audit committees (Bilal et al, 2018;Bryce, Ali, & Mather, 2015). Chen and Rezaee (2012) found that board of directors who were active helped their companies to align with the IFRS and, thereby providing high-quality earnings.…”

Section: Managerial Ownership Ifrs Adoption and Eqmentioning

confidence: 99%

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Ownership Structure and Earnings Quality Pre- and Post-IFRS: Does Investor Protection Matter?

Alhadi¹,

Senik

Johari

et al. 2020

AJBA

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Manuscript type: Research paper Research aims: This study examines whether managerial and institutional ownership is associated with higher earnings quality (EQ) after the implementation of International Financial Reporting Standards (IFRS), in comparison to the pre-IFRS period. It also examines the moderating effect of investor protection (INPT) on the link between ownership structure and EQ. Design/Methodology/Approach: This study uses a dynamic panel data modelling on a sample of 2090 firm-year observations, from 2007-2016, in Malaysia. This study applies the generalized method of moments (GMM) to deal with the econometric problems. Research findings: The results indicate that managerial ownership is essential for improving EQ before and after IFRS adoption. No

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Section: The Moderating Effect Of Ifrs Adoptionsupporting

confidence: 67%

Section: Managerial Ownership Ifrs Adoption and Eqmentioning

confidence: 99%

Ownership Structure and Earnings Quality Pre- and Post-IFRS: Does Investor Protection Matter?

Alhadi¹,

Senik

Johari

et al. 2020

AJBA

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“…First, by considering ICS efficiency this research extends gender literature on the AC and FRQ The findings report the importance of the WACCH in mitigating earnings management. Moreover, it is a pioneering document to address questions raised in previous research regarding gender diversity on boards and its link with the efficiency of ACs (Bilal et al, 2018;Garc ıa-S anchez et al, 2017;Zalata et al, 2018). Second, this research is the first to report the effect of accounting expertise of WACCHs and efficient ICS, its components, on FRQ The findings suggest that due to the accounting expertise of WACCHs, they are less likely to report earnings management than male AC chairs (MACCH), whereby agency conflict is mitigated.…”

Section: Introductionmentioning

confidence: 79%

“…Based on the prior literature (i.e. Baxter & Cotter, 2009;Bilal et al, 2018;Gull et al, 2017;Thiruvadi & Huang, 2011), b 3 < 0 is expected. Table 1 presents the descriptive statistics of all variables.…”

Section: Research Modelsmentioning

confidence: 99%

Gender diversity in the audit committee and the efficiency of internal control and financial reporting quality

Din

Cheng

Ahmad

et al. 2020

Economic Research-Ekonomska Istraživanja

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This research investigates the relationship between the expertise of female audit committee (AC) chairs and financial reporting quality (FRQ). Also, it examines the moderating effect of the expertise of AC female chairs on the relationships between internal control (ICS), components of ICS, and FRQ This study analyses 302 firms listed on the Pakistan Stock Exchange from 2010 to 2016. Data on ICS, FRQ, and other corporate governance indications are collected manually from annual reports. This study concludes that the accounting expertise of AC female chairs enhances FRQ better than their male counterparts. Also, the accounting expertise of AC female chairs improve corporate governance mechanisms and ICSs (i.e., Control Environment, Control Activities, and information and communication). This research offers implications for shareholders and regulators. The accounting expertise of female AC chairs (WACCH) improve monitoring that enhances shareholder value and investor confidence. The regulator needs to be stricter regarding the requirements for AC chairs.

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“…Zimmerman (2015) finds that firms with greater board independence and audit committee expertise are more likely to forego the exemptions afforded by the JOBS Act. Because firms with greater board independence and audit committee expertise are more likely to have higher financial statement quality (e.g., Bilal, Chen, & Komal 2018), Zimmerman (2015) hints at a relationship between EGCs' election choices and financial statement quality.…”

Section: Egc Section 107 Election and Financial Statement Quality Andmentioning

confidence: 99%

Examining the Decision to Opt In versus Opt Out of Section 107 of the JOBS Act of 2012: Determinants and Consequences

Bergner¹,

Brooks

Guragai³

2019

AFR

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The Jumpstart Our Business Startups Act of 2012 (hereafter, JOBS Act) creates a new category of firms, referred to as “Emerging Growth Companies” (hereafter, EGCs). Section 107 of the JOBS Act, titled “Opt-In Right for EGCs,” gives EGCs the choice to take advantage of an extended transition period for complying with new or revised accounting standards. In other words, an EGC can choose to delay the adoption of new or revised accounting standards until those standards would otherwise apply to private companies. Using a logistic regression approach with hand-collected data, we examine the underlying firm characteristics associated with EGCs’ choice of opting in or out of the accounting standards exemption, as provided by Section 107 of the JOBS Act. Using additional ordinary least square regression analyses, we further examine whether the choice of opting in or out is associated with earnings management and financial statement restatement behavior. Our results suggest that EGC firms designated as “smaller reporting companies” are more likely to choose to delay the adoption of a new or revised accounting standard (i.e., opt in). Our findings also show that EGCs that employ Big 4 auditors are more likely to opt out. We further find that EGCs that choose to opt out are less likely to engage in earnings management behavior, proxied by the absolute value of abnormal accruals, and are less likely to restate their financial statements. Taken together, our findings suggest that EGCs that choose to opt out of Section 107 produce higher quality financial statements.

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Audit committee financial expertise and earnings quality: A meta-analysis

Cited by 131 publications

References 93 publications

Ownership Structure and Earnings Quality Pre- and Post-IFRS: Does Investor Protection Matter?

Ownership Structure and Earnings Quality Pre- and Post-IFRS: Does Investor Protection Matter?

Gender diversity in the audit committee and the efficiency of internal control and financial reporting quality

Examining the Decision to Opt In versus Opt Out of Section 107 of the JOBS Act of 2012: Determinants and Consequences

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