The effect of audit committee characteristics on intellectual capital disclosure

Abstract

This paper, using data from 100 UK listed firms, investigates the relationship between audit committee characteristics and intellectual capital (IC) disclosure. We find that IC disclosure is positively associated with audit committee characteristics of size and frequency of meetings, and negatively associated with audit committee directors' shareholding. We find no significant relationship between IC disclosure and audit committee independence and financial expertise. We also observe variations in the association between audit committee characteristics and IC disclosure at its component level, which suggest that the underlying factors that drive various forms of IC disclosure, i.e. human capital, structural capital and relational capital, are different. These results have important implications for policy-makers who have a responsibility to ensure that shareholders are protected by prescribing appropriate corporate governance structures and accounting regulations/ guidelines.

Audit Committee Characteristics and Earnings Management: The Case of Bahrain

“…Therefore, the AC is viewed as a monitoring mechanism intended to reduce information asymmetries between management and stakeholders, since its key functions are to improve the quality and accuracy of financial information through constantly monitoring the management's opportunistic behaviours (e.g., Klein, 2002;Davidson et al, 2005;Pucheta-Martinez and Fuentes, 2007;. Dhaliwal et al, 2010;Li et al, 2012).…”

“…Literature on AC has suggested that AC effectiveness essentially functions on AC characteristics (e. g. Persons, 2009;Bédard and Gendron, 2010;Dhaliwal et al, 2010;Li et al, 2012). Therefore, the perfect AC size with the right combination of skills and experience are critical in supporting the AC's ability in detecting and preventing earnings management.…”

“…AC is considered as one of the crucial and influential participants of corporate governance as it assists the board of directors in discharging its responsibilities in overseeing corporate management (Bédard and Gendron, 2010;Li et al, 2012). An AC is a sub-committee of the board that specializes in, and is responsible for, ensuring the accuracy and reliability of the financial statements provided by management.…”

Eksplorasi Elemen Integrated Reporting Dalam Annual Reports Perusahaan Di Indonesia

“…Karakteritik corporate governance terutama komite audit diyakini dapat mempengaruhi luas lingkup integrated reporting. Riset yang menginvestigasi pengaruh karakteristik perusahaan misalnya komite audit terhadap integrated reporting diyakini penting karena komite audit seringkali dihubungkan dengan kualitas pelaporan keuangan (Bédard & Gendron, 2010;Li, Mangena, & Pike, 2012;Lisic, Neal, Zhang, & Zhang, 2015). Komite audit harus berperan aktif dalam mereview laporan keuangan termasuk integrated reporting dan harus memperhatikan semua aspek yang mungkin berdampak pada integritas integrated reporting (Ahmed Haji, 2015).…”

“…Komite Audit adalah komite pengawas di bawah dewan komisaris karena dewan komisaris dalam menjalankan tugasnya melimpahkan tanggung jawab dalam proses pelaporan perusahaan kepada komite audit (Bédard & Gendron, 2010;Ghafran & O'Sullivan, 2013;Li et al, 2012). Komite audit diyakini memiliki peran dalam mengurangi asimetri informasi (Akhtaruddin & Haron, 2010;Al Daoud, Ku Ismail, & Lode, 2015) dan akibatnya mengurangi biaya agensi (Bédard & Gendron, 2010).…”