• The Journal of Asian Finance, Economics and Business
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• v.8 no.5
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• pp.151-156
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• 2021

This paper empirically examines the relationship between one of the major corporate governance attributes; family ownership and the audit committee activity across a sample of 430 publicly traded firms on the Saudi Stock Exchange (Tadawul) for the period 2012-2019. Using the Pooled OLS regression, this study finds that family ownership is negatively associated with audit committee activity. This study reported that family ownership is negatively associated with audit committee activity, giving support to the convergence-of-interest hypothesis. Therefore, the existence of family ownership as a monitoring corporate governance mechanism substitutes the audit committee activity as another monitoring mechanism. This study provides empirical evidence on the associations of two internal corporate governance mechanisms, namely; family ownership and audit committee activity in the Saudi context where there is a paucity of research in this area. The findings of this study provide a new understanding regarding the extent to which family ownership impacts the activity of audit committees in manufacturing companies. Similarly, the companies' management, external auditors, bankers, and companies would also benefit from understanding the influential factors of the audit committee activities.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.1
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• pp.179-185
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• 2021

The aim of this study is to examine the impact of board of directors' activity on the audit committee's effectiveness score among manufactured listed companies on Saudi Stock Exchange (Tadawul) for the period 2015-2017. The final sample of this study consists of 195 firm-year observations that represent manufactured companies listed on Saudi Stock Exchange (Tadawul) for the years 2015-2017. The data of this study in terms of board of directors' meetings, audit committee size and meetings, firm leverage, firm performance, and firm age were hand-collected from the annual reports of the considered companies. The Pooled OLS regression's result indicate that audit committee's effectiveness score is influenced by the board of directors' activity. This result gives support to the agency theory prediction. This result is also consistent with the complementary function of corporate governance mechanisms in which board of directors' activity complements the function of audit committee's effectiveness score. The result of this study should be useful for manufacturing companies, Saudi Stock Exchange, auditors, and regulators which relates to the association between board of directors' activity and audit committee's effectiveness score. This study provides a new empirical evidence on the impact of board activity on the audit committee's effectiveness score in an interesting context which is Saudi Arabia.

• The Journal of the Korea Contents Association
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• v.20 no.1
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• pp.427-436
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• 2020

Prior literature shows that audit market concentration which is measured as the Herfindahl index is negatively associated with audit quality in Korea. This study analyzes whether characteristics of an audit committee have effect on the relation between audit market concentration and audit quality. This is because it is expected that effective audit committees restrict the tendency of dominant auditors to neglect their duties. The empirical results of this study using the sample firms having an audit committee listed in the Korea Composite Stock Price Index market for 2006-2015 are summarized as follows. First, consistent with prior research, audit quality decreases as audit market concentration increases. However, audit quality is not lowered as audit market concentration rises only when the audit committee has financial expertise among representative characteristics of an audit committee - independence, financial expertise, and activity. This research finds contributions in that it explores the effect of audit committee characteristics on audit quality in consideration of audit market concentration and utilizes the differential types of the characteristics of an audit committee at the same time.