Effect of Audit Committee Attributes on Internal Control Over Financial Reporting: Perception of External Auditors in Addis Ababa
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Date
2020-11
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A.A.U
Abstract
Audit committee plays an important role improving internal control and also increase
financial reporting quality and this will boost confidence of interestedparties. The main objective
of this study was to assess the attributes of audit committee as per perception the experienced
external auditors in Ethiopia. The study adopted a mixed research approach. The quantitative
component used survey of employees working in 15Audit firms in Ethiopia. Random sample of
150 Auditors were covered by the survey; the response rate was 86%. Survey data was collected
by use of a structured questionnaire. Multiple regression models were used to test whether Audit
committee size, independency, expertise, diligence, and tenure have any relation with internal
control over financial reporting. As part of the qualitative component interviews with Audit
managers and partners were held. And The collected data was analyzed multiple linear
regression analysis and It was found that attributes of audit committee had a significant
relationship with internal control over financial reporting. The findings of the study suggested
that Audit committee attributes especiallyIndependency, financial expertise and diligences are
important areas that can have great impact to improve internal control over financial reporting
and based on this corporate governance which have audit committee needs to have at least
financially expert, independent, and diligent to achieve the intended objectives.
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Keywords
Independency, financial expertise,tenureanddiligence