Audit Committees, Boards of Directors, and Remediation of Material Weaknesses in Internal Control

• 成果类型: Article
• 署名作者: Goh, Beng Wee
• 署名单位: Singapore Management University
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1506/car.26.2.9
• 发表日期: 2009
• 页码: 549-+
• 关键词: control deficiencies; QUALITY

摘要

This study examines whether the effectiveness of the audit committee and the board of directors is associated with firms' timeliness in the remediation of material weaknesses (MWs) in internal control. The sample comprises accelerated filers that disclosed at least one MW from July 2003 to December 2004 under section 302 of the Sarbanes-Oxley Act (SOX). Using logistic regression analyses, I find that firms with larger audit committees, audit committees with greater nonaccounting financial expertise, and more independent boards are more likely to remediate MWs in a timely manner. These results suggest that the audit committee and the board play an important role in monitoring the remediation of MWs. Overall, the study contributes to our understanding of the effectiveness of the audit committee and the board under the SOX regime. The study also identifies important determinants of firms' timeliness in the remediation of MWs, which is key to improving financial reporting quality and restoring investor confidence.