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Internal Governance Structure and External Audit Fee: Malaysia Evidence

UNIMAS Review of Accounting and Finance

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Title Internal Governance Structure and External Audit Fee: Malaysia Evidence
 
Creator Abd Rahim, Maisarah
 
Description Internal governance structure plays a role in improving quality of financial reporting, thus determining external audit fee is very important. The objective of this study is to examine the association between external audit fees and internal governance structure (boards and audit committee characteristics). The methodology used based on the sample of 115 companies listed on the Bursa Malaysia Main Market in 2015. It is hypothesized that external audit fees will be positively associated with board of director and audit committee’s independence, expertise and meeting frequency. As a result, the findings reveal that no variable found to be significant to external audit fee except for audit committee expertise (audit committees who being accounting professional members). Audit committee expertise indicate negative and significant relationship with external audit fee which implies that the existence more audit committee member who possess accounting professional certification tend to provide complementary effect towards audit effort in the process of negotiating audit fee, thus lower audit fee will be paid. The study suggests there are opportunities to include other variables such as director’s remuneration, ownership structure or /and audit tenure for future research.
 
Keywords: Corporate Governance, Boards of Directors, Audit Committees, External Audit Fee, Malaysia
 
 
Publisher Universiti Malaysia Sarawak
 
Date 2018-12-27
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
 
Format application/pdf
 
Identifier http://publisher.unimas.my/ojs/index.php/URAF/article/view/1041
 
Source UNIMAS Review of Accounting and Finance; Vol 1 No 1 (2018): Issue 1
 
Language eng
 
Relation http://publisher.unimas.my/ojs/index.php/URAF/article/view/1041/722
 
Rights Copyright (c) 2018 UNIMAS Review of Accounting and Finance
http://creativecommons.org/licenses/by-nc-sa/4.0