The Impact of Audit Committee Information Technology Expertise on the Reliability and Timeliness of Financial Reporting

• 成果类型: Article
• 署名作者: Ashraf, Musaib; Michas, Paul N.; Russomanno, Dan
• 署名单位: Michigan State University; University of Arizona
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/accr-52622
• 发表日期: 2020
• 页码: 23-56
• 关键词: internal control; accounting experts; earnings quality; determinants; association; weaknesses

摘要

We examine whether information technology expertise on audit committees impacts the reliability and timeliness of financial reporting. We find a reduction in the likelihood of material restatement, a reduction in the likelihood of information technology-related material weaknesses (which account for 55 percent of all reported material weaknesses), and more timely earnings announcements at firms with audit committee information technology expertise. These findings are robust to controlling for a firm's other information technology attributes, as well as when using entropy balanced samples, and we mitigate endogeneity concerns with evidence that our findings hold in a subsample of firms that all possess overall high-quality information technology. Finally, a difference-indifferences analysis, inclusion of firm fixed effects, and a falsification test largely support our assertion that the quality of financial reporting is significantly improved by the presence of an audit committee information technology expert.