Research on the Relationship between Audit Risk Assessment and Risk Governance: Evidence from Tunisia

Two-tier board characteristics and expanded audit reporting: Evidence from China

“…Consistent with this view, Feng et al (2020) find that the independence of the board of directors within a two-tier board structure increases monitoring function and, thus, is negatively associated with the fraud. Fakhfakh and Jarboui (2022) indicate that boards with more independent directors are associated with lower audit risk. Previous studies (e.g., Chen et al 2013;Ji et al 2015a, b) find that firms with a higher percentage of independent directors are less likely to disclose internal control weaknesses and to receive a modified auditor's opinion.…”

“…In terms of the two-tier board structure, Feng et al (2020) find that a larger board of directors is negatively associated with fraud. Fakhfakh and Jarboui (2022) suggest that the size of the board of directors is negatively related to audit risk. Furthermore, previous studies (Bazrafshan et al 2016;Singh et al 2018) suggest that a larger board of directors improves monitoring, reduces earnings management practices, enhances investment efficiency, and increases firm performance.…”

“…Prior research (e.g., Fakhfakh and Jarboui 2022;Feng et al 2020) indicates that the characteristics of corporate governance can be linked to auditors' assessment of risk and their reporting behavior. In general, there are two main board structures in corporate governance: the one-tier (unitary) board structure and the two-tier (dual) board structure (Firth et al 2007;Cho and Rui 2009).…”

External Auditors' Impact on Corporate Governance of Unlisted Firms: A Developing Country Perspective

“…This method helps identify possible risk areas, such as fraud or corruption within a corporation and evaluates how successful the organisation's risk mitigation strategies are (Manita et al, 2020;Saputra & Yusuf, 2019). From the findings of the study of Almasria (2022) and Fakhfakh and Jarboui (2023), auditors contribute to the improvement of corporate governance practises and the guarantee of the organization's continued viability over the long term by conducting investigations into the overall risk tolerance and the effectiveness of attempts to mitigate risks. In addition, Fakhfakh and Jarboui (2023) indicate that, external auditors lend a hand in crisis management by analysing the efficiency of emergency plans and determining whether or not they are ready.…”

“…External auditors cultivate regulators' trust and confidence by carrying out audits that are open to scrutiny and comprehensive in scope. The trust that is instilled in the regulators as a result of the review of an entity's records and validation of its disclosures by auditors contributes to the strengthening of the entire regulatory environment (Fakhfakh & Jarboui, 2023). Therefore, the presence of external auditors contributes significantly to the improvement of corporate governance practices in unlisted companies.…”