This paper examines the possible effects of corporate governance (GC) on audit quality (AQ) among the FTSE 350 companies. Using a sample of 180 companies from 2012 to 2017 (i.e., 1080 firm-year observations) a binary logistic model has been employed to investigate the CG-AQ nexus. This analysis was supported by conducting a probit logistic model as a sensitivity analysis. Our findings are associative of a heterogeneous impact of CG on AQ post the implementation of the 2012 CG reforms in the UK. For example, although institutional ownership and management ownership can predict AQ, board independence, non-executive directors and audit committee are not attributed to AQ in the UK. This implies that corporate compliance with good CG practices has a limited impact on the decision to select a Big4 auditor in the UK. Despite the limitations of our study, we hope it can motivate further investigations in this area.
This article seeks to contribute to International Financial Reporting Standards (IFRS) literature by examining the effects of adopting IFRS on stock market performance worldwide from the diffusion of innovation theory perspective. Our study revealed several interesting findings after using combinations of unique panel data sets from 110 countries worldwide and conducting a robust empirical analysis from 1995 to 2014. First, we found a positive association between late mandatory IFRS adoption and stock market integration in Europe. Second, our findings indicate a significant negative association between early IFRS adoption and the following financial indicators: stock market trading volumes, stock market capitalization, market turnover, and market return. Third, our study reveals an insignificant association between early IFRS adoption and stock price volatility alongside stock market development. Our findings are robust and have significant practical and policy implications for regulators and policymakers of multinational corporations.
The main aim of this research is to assess the effectiveness of internal governance controls and processes with specific focus on the skills and challenges facing internal auditors operating in Libya when they conduct internal audits. This study also investigates whether Libyan internal auditors have sufficient skills needed to implement their internal audit function effectively. Design/methodology/approach: Forty one internal auditors working in six banks and three insurance companies listed on the Libyan Stock Market were surveyed. Wilcoxon signed test and Z-test were used to test the research hypotheses. Findings: The findings of this study illustrate that internal auditors operating in companies listed on the Libyan Stock Market have limited professional, interpersonal and technical skills. Specifically, the findings show that internal auditors in Libya have limited skills including public speaking and presentation skills. Additionally, they have limited skills of IT audit and international financial report preparation skills. Originality/value: There is a dearth of empirical evidence on the extent of audit, interpersonal, professional and technical skills relating to internal auditors generally, but particularly acute in Arab and developing countries. This study, therefore, contributes to the literature by offering new insights with particular focus on Libya.
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