The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms

The study is motivated by the distinctive ownership structure in the Malaysian firms which differs from other developed markets. The role of corporate governance in such institutional settings is more crucial. This study primarily examines the characteristics of management, audit committee and the...

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Main Author:	Raza, Ali
Format:	Thesis
Language:	eng eng
Published:	2021
Subjects:	HF5667 Professional Ethics Auditors.
Online Access:	https://etd.uum.edu.my/9596/1/s900795_01.pdf https://etd.uum.edu.my/9596/2/s900795_02.pdf
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id	my-uum-etd.9596
record_format	uketd_dc
spelling	my-uum-etd.95962024-03-19T01:47:18Z The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms 2021 Raza, Ali Wan Hussin, Wan Nordin Abdul Majid, Jamaliah Othman Yeop Abdullah Graduate School of Business Othman Yeop Abdullah Graduate School of Business HF5667 Professional Ethics. Auditors. The study is motivated by the distinctive ownership structure in the Malaysian firms which differs from other developed markets. The role of corporate governance in such institutional settings is more crucial. This study primarily examines the characteristics of management, audit committee and the external auditor to ascertain how these governance mechanisms can enhance the financial reporting quality. The data is obtained from the annual reports of the companies listed in Bursa Malaysia. The data related to 120 firm-year observations which received modified audit opinions during the period 2012 to 2016 were matched with the firms which received clean audit opinions based on pre-determined criteria. In total 240 firm-year observations were included in the empirical examination. The statistical methods including univariate and multivariate regression models were employed to examine the study hypotheses. The findings reveal that CEO age, founder status and ownership have a strong association with modified audit opinion. Management is an integral part of the financial reporting process and the findings signify that powerful management considerably influences the reporting outcomes. The results related to the audit committee and its chair illustrate that number of meetings and the busyness of its chair are positively associated with the issuance of modified audit opinion. This finding is interesting in that a busy audit committee chair has a negative influence on the financial reporting quality of the firm. The external audit partner‟s busyness is also found to be positively associated with the modified audit opinion. This result shows that workload affects the audit efforts of external auditors. Further, interaction analysis reveals that there is a negative impact of the interaction between audit committee independence and CEO duality on the issuance of modified audit opinion. Overall, the results are significant in emerging markets context 2021 Thesis https://etd.uum.edu.my/9596/ https://etd.uum.edu.my/9596/1/s900795_01.pdf text eng public https://etd.uum.edu.my/9596/2/s900795_02.pdf text eng public other doctoral Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Wan Hussin, Wan Nordin Abdul Majid, Jamaliah
topic	HF5667 Professional Ethics Auditors.
spellingShingle	HF5667 Professional Ethics Auditors. Raza, Ali The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
description	The study is motivated by the distinctive ownership structure in the Malaysian firms which differs from other developed markets. The role of corporate governance in such institutional settings is more crucial. This study primarily examines the characteristics of management, audit committee and the external auditor to ascertain how these governance mechanisms can enhance the financial reporting quality. The data is obtained from the annual reports of the companies listed in Bursa Malaysia. The data related to 120 firm-year observations which received modified audit opinions during the period 2012 to 2016 were matched with the firms which received clean audit opinions based on pre-determined criteria. In total 240 firm-year observations were included in the empirical examination. The statistical methods including univariate and multivariate regression models were employed to examine the study hypotheses. The findings reveal that CEO age, founder status and ownership have a strong association with modified audit opinion. Management is an integral part of the financial reporting process and the findings signify that powerful management considerably influences the reporting outcomes. The results related to the audit committee and its chair illustrate that number of meetings and the busyness of its chair are positively associated with the issuance of modified audit opinion. This finding is interesting in that a busy audit committee chair has a negative influence on the financial reporting quality of the firm. The external audit partner‟s busyness is also found to be positively associated with the modified audit opinion. This result shows that workload affects the audit efforts of external auditors. Further, interaction analysis reveals that there is a negative impact of the interaction between audit committee independence and CEO duality on the issuance of modified audit opinion. Overall, the results are significant in emerging markets context
format	Thesis
qualification_name	other
qualification_level	Doctorate
author	Raza, Ali
author_facet	Raza, Ali
author_sort	Raza, Ali
title	The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
title_short	The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
title_full	The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
title_fullStr	The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
title_full_unstemmed	The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms
title_sort	relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from malaysian listed-firms
granting_institution	Universiti Utara Malaysia
granting_department	Othman Yeop Abdullah Graduate School of Business
publishDate	2021
url	https://etd.uum.edu.my/9596/1/s900795_01.pdf https://etd.uum.edu.my/9596/2/s900795_02.pdf
_version_	1794023763772178432

The relationship between management, audit committee and external auditor characteristics and modified audit opinions: evidence from Malaysian listed-firms

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