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Thedata used in the analyses are collected from the Spanish stock market in 2003. The results showthe existence of a non-linear relationship between the managerial stock ownership and theactivity of the audit committee. We have also verified the existence of a lower audit com-mittee’s activity in highly leveraged firms and when the ownership structure is concentrated inthe hands of large shareholders. The large firms have more active committees than small firms.Finally, we have not found any evidence of a significant influence of the composition of theboard or the audit committee on the activity of the latter.海图收集用于分析从西班牙股市在2003年。的结果showthe存在一种非线性的关系，管理层持股和几近审核委员会。我们也验证了存在一个较低的审计委员会的活动在高杠杆企业所有制结构集中在矿井大股东手中。大公司有更多比小firms.Finally活跃的委员会，我们还没有发现任何证据的重大影响，后者的活动theboard或审计委员会的组成。


Introduction

Economic scandals highlighting Accountingmanipulation have damaged investors’trust in both U.S. and European financialmarkets. The investment community’s claimof having launched measures to improvemarket transparency focuses attention onthe role of audit committees in improving thequality of financial statements. The Securitiesand Exchange Commission (SEC) has beenrecommending U.S. https://www.51lunwen.org/jrfx/ listed companies to formaudit committees since 1972, and indeed thishas been a requisite for listing since 1978(Goddard and Masters, 2000). However, thepersistence of accounting scandals has led toprofound reconsideration of the workings ofaudit committees, with special attention beingpaid to their composition and independencefrom managerial teams. The Treadway Com-mission (1987), the Cadbury Report (1992), theAmerican Law Institute (1994) and the BlueRibbon Committee (1999) all recommendedthat independent directors with an adequatebackground in auditing activities should siton audit committees. The Sarbanes-Oxley Act(2002) not only imposes the independence ofmembers of audit committees but also stipu-lates that at least one member of an audit com-mittee should have far-reaching experience inthe field of finance.

As also happened in the U.S. market,Spanish companies have been subject in recentyears to ever-tighter financial control andpressure to encourage the formation of inde-pendent audit committees. The Spanish Codeof Best Practices (the 1998 Olivencia Code)recommends setting up audit committees toverify companies’ financial statements andinternal audit systems. When Spain’s 2002Financial System Reform Law was passed,audit committees became mandatory forall listed companies as of January 2003. TheAldama Report recommends forming auditcommittees entirely of external directors (i.e.,independent directors and large shareholder_representatives) in a proportion similar tothat of the board of directors. Independent presidents for audit committees are alsorecommended.

References

Abbott, L. J., Parker, S. and Peters, G. F. (2004) 

AuditCommittee Characteristics and Financial Mis-statement: a Study of the Efficacy of Certain 
BlueRibbon Committee Recommendations, Auditing:a Journal of Practice & Theory, 23, 69–87.American Law Institute (1994) Principles of Corpo-rate Governance: Analysis and Recommenda-tions, The American Law Institute Publishers, St.Paul, MN.Beasley, M. S. (1996) An Empirical Analysis of theRelation between the Board of Director Com-position and Financial Statement Fraud, TheAccounting Review, 71, 443–466.Bédard, J., Marrakchi, S. and Court本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。