خبرگی مالی کمیته حسابرسی و کیفیت سود
Abstract
1- Introduction
2- Review of literature
3- Method
4- Results and discussion
5- Implications for regulators
6- Concluding remarks
References
Abstract
Since the implementation of the Sarbanes–Oxley Act (SOX), a plethora of research has examined financial experts' monitoring on audit committees of financial reporting quality. However, the literature has found mixed evidence. This present study's objective is to reconcile through meta-analysis the results of 90 studies with 165,529 firm-year observations concerning the relationship between audit committee financial expertise and earnings quality. The results show that audit committee financial expertise has a positive relationship with earnings quality and that accounting financial experts have a stronger relationship with earnings quality than non-accounting financial experts. Moreover, corporate governance systems, International Financial Reporting Standards (IFRS), and SOX moderate the relationship between audit committee financial expertise and earnings quality. Additional moderators of this relationship are different proxies of earnings quality and audit committee financial expertise, financial experts' independence and busyness, the external auditor's role, and publication quality. This study provides implications for regulators in terms of tightening the definition of audit committee financial expert and the need for at least two financial experts. Further, the study identifies opportunities for future research. Specifically, we provide suggestions for the improvement of financial experts' effectiveness and the expansion of existing research. We also highlight emerging research areas.
Introduction
Audit committee financial expertise is the most prominent feature of audit committee effectiveness that has caught the attention of regulators in recent years (CAQ, 2016; Griffin, 2016). In the USA, the Securities and Exchange Commission's (SEC's) original definitioni of financial expert, proposed by the Sarbanes–Oxley Act (SOX), was considered to be too narrow and controversial because it was restricted to only the accounting financial expertise of audit committee members who have qualifications and experience as public accountants; namely, Chartered Professional Accountants (CPAs) and Chartered Financial Analysts (CFAs) (Bryan-Low, 2002). Later, SEC's final rule broadenedii the scope of audit committee financial experts (ACFEs) under Section 407 of SOX by including accounting financial experts (AFEs) and non-accounting financial experts (NAFEs). Among the latter are financial experts (e.g., investment bankers and financial analysts) and supervisory experts (e.g., chief executive officers (CEOs) and firms' presidents). Likewise, other countries have specific requirements for ACFEs.