Audit committee guidance for strengthened corporate governance
Open Access
- 22 October 2020
- journal article
- Published by Virtus Interpress in Corporate Board: role, duties and composition
- Vol. 16 (3), 39-51
- https://doi.org/10.22495/cbv16i3art3
Abstract
The major research question in this paper is how to provide guidance to board of directors’ audit committees in order to strengthen corporate governance. Audit committees have a direct responsibility to oversee the integrity of a company’s financial statements and to hire, compensate, and oversee the external auditor. Public focus, especially by activist and passive investors, on how audit committees discharge these responsibilities has increased significantly. As analyzed in this paper, indications that this current audit regime is not working are overwhelming. Neither the public interest nor the needs of investors are being served by the auditor-client relationship as it exists. The reforms suggested in this paper represent advances that would help both board of directors’ audit committees and the auditing profession become trusted watchdogs of public companies’ financial information. This paper speaks to the growing research attention to the audit function and maps out the well-developed strategies to advance the audit quality. The major sections of this paper are a century of audit opinions, 21st-century frauds, fraud analysis, auditor assessment tool (created by The Center for Audit Quality), auditor continuing issues, auditor upgrades, discussion, and conclusionKeywords
This publication has 22 references indexed in Scilit:
- Effects of Low Audit Quality Revelation on Audit Effort, Audit Quality, and Auditor TenureSSRN Electronic Journal, 2020
- Can Audit Committee Expertise Increase External Auditors' Litigation Risk? The Moderating Effect of Audit Committee IndependenceContemporary Accounting Research, 2020
- The Effect Double Job of Audit Committee Member in Remuneration Committee on Audit FeesKnE Social Sciences, 2020
- The Time Dependence of Audit Firm Alumni Effects: Evidence from Audit CommitteesInternational Journal of Auditing, 2020
- The role of the external auditor in corporate governance: The case of companies listed in the NYSE Euronext LisbonRisk Governance and Control: Financial Markets & Institutions, 2018
- An investigation into the effectiveness of audit committeesCorporate Board: role, duties and composition, 2017
- The pattern of fraudulent accounting : Ethics, external auditing and internal whistle-blowing processJournal of Governance and Regulation, 2017
- Predicting Material Accounting Misstatements*Contemporary Accounting Research, 2011
- Fraudulent Financial Reporting Detection: Key Ratios Plus Corporate Governance FactorsInternational Studies of Management & Organization, 2008
- The Detection of Earnings ManipulationCFA Magazine, 1999