Overlapping memberships on the audit and other board committees: impacts on financial reporting quality

Research aim: This research aims to investigate how overlapped members on the audit committee (AC) impact the primary role of the committee, especially in terms of improving the quality of the financial reporting of the company. Design/ Methodology/Approach: The population of the study consists of...

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Main Authors:	Furqaan, Abdirahman, Annuar, Hairul Azlan, Hamdan, Hamdino, Abdul Rashid, Hafiz Majdi
Format:	Article
Language:	English
Published:	Universiti Malaya 2019
Subjects:	HG Finance HG4001 Financial management. Business finance. Corporation finance.
Online Access:	http://irep.iium.edu.my/71130/ http://irep.iium.edu.my/71130/ http://irep.iium.edu.my/71130/1/71130_Overlapping%20memberships%20on%20the%20audit.pdf

id	iium-71130
recordtype	eprints
spelling	iium-711302019-07-12T07:14:09Z http://irep.iium.edu.my/71130/ Overlapping memberships on the audit and other board committees: impacts on financial reporting quality Furqaan, Abdirahman Annuar, Hairul Azlan Hamdan, Hamdino Abdul Rashid, Hafiz Majdi HG Finance HG4001 Financial management. Business finance. Corporation finance. Research aim: This research aims to investigate how overlapped members on the audit committee (AC) impact the primary role of the committee, especially in terms of improving the quality of the financial reporting of the company. Design/ Methodology/Approach: The population of the study consists of non-financial institutions listed on Bursa Malaysia (BM). Using purposive sampling, cross-sectional data were collected from the annual reports of the 100 top companies listed on BM. Research finding: The descriptive statistics of the study show that 98.7 per cent of the observed companies in this study have overlapping membership on the audit and other board committees. The study also shows that more than three-fourths of the AC members also serve on other board committees. The study found that overlapping memberships on the AC and other mandatory committees, significantly and positively impact the financial reporting quality (FRQ). Theoretical contribution/Originality: The results of this study suggest that overlapping memberships on the AC of the Malaysian big public listed companies play a significant role in terms of the FRQ of the company. Practitioner/Policy implication: Regulatory bodies and investors should encourage the chair of the AC to work on other board committees to bring relevant information to improve the performance of the AC. Research limitation/Implication: The inherent drawback of the current research is the small sample size, and that it does not provide in-depth and comprehensive data from the documents of the company. The research sample was drawn from the largest 100 Malaysian companies. Therefore, the results of the study may not be generalisable to smaller companies. Universiti Malaya 2019-02-28 Article PeerReviewed application/pdf en http://irep.iium.edu.my/71130/1/71130_Overlapping%20memberships%20on%20the%20audit.pdf Furqaan, Abdirahman and Annuar, Hairul Azlan and Hamdan, Hamdino and Abdul Rashid, Hafiz Majdi (2019) Overlapping memberships on the audit and other board committees: impacts on financial reporting quality. Asian Journal of Accounting Perspectives, 12 (1). pp. 49-77. ISSN 0128-0384 https://ajap.um.edu.my/article/view/16888/9905
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HG Finance HG4001 Financial management. Business finance. Corporation finance.
spellingShingle	HG Finance HG4001 Financial management. Business finance. Corporation finance. Furqaan, Abdirahman Annuar, Hairul Azlan Hamdan, Hamdino Abdul Rashid, Hafiz Majdi Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
description	Research aim: This research aims to investigate how overlapped members on the audit committee (AC) impact the primary role of the committee, especially in terms of improving the quality of the financial reporting of the company. Design/ Methodology/Approach: The population of the study consists of non-financial institutions listed on Bursa Malaysia (BM). Using purposive sampling, cross-sectional data were collected from the annual reports of the 100 top companies listed on BM. Research finding: The descriptive statistics of the study show that 98.7 per cent of the observed companies in this study have overlapping membership on the audit and other board committees. The study also shows that more than three-fourths of the AC members also serve on other board committees. The study found that overlapping memberships on the AC and other mandatory committees, significantly and positively impact the financial reporting quality (FRQ). Theoretical contribution/Originality: The results of this study suggest that overlapping memberships on the AC of the Malaysian big public listed companies play a significant role in terms of the FRQ of the company. Practitioner/Policy implication: Regulatory bodies and investors should encourage the chair of the AC to work on other board committees to bring relevant information to improve the performance of the AC. Research limitation/Implication: The inherent drawback of the current research is the small sample size, and that it does not provide in-depth and comprehensive data from the documents of the company. The research sample was drawn from the largest 100 Malaysian companies. Therefore, the results of the study may not be generalisable to smaller companies.
format	Article
author	Furqaan, Abdirahman Annuar, Hairul Azlan Hamdan, Hamdino Abdul Rashid, Hafiz Majdi
author_facet	Furqaan, Abdirahman Annuar, Hairul Azlan Hamdan, Hamdino Abdul Rashid, Hafiz Majdi
author_sort	Furqaan, Abdirahman
title	Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
title_short	Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
title_full	Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
title_fullStr	Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
title_full_unstemmed	Overlapping memberships on the audit and other board committees: impacts on financial reporting quality
title_sort	overlapping memberships on the audit and other board committees: impacts on financial reporting quality
publisher	Universiti Malaya
publishDate	2019
url	http://irep.iium.edu.my/71130/ http://irep.iium.edu.my/71130/ http://irep.iium.edu.my/71130/1/71130_Overlapping%20memberships%20on%20the%20audit.pdf
first_indexed	2023-09-18T21:40:57Z
last_indexed	2023-09-18T21:40:57Z
_version_	1777413136499867648

Overlapping memberships on the audit and other board committees: impacts on financial reporting quality

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