Affiliation:
1. Ferdowsi University of Mashhad, Iran
2. Imam Reza International University, Iran
3. Birzeit University, Palestine
Abstract
ABSTRACT This paper examines the relationship between audit committee characteristics and regulatory scrutiny. Comment letters issued by the Securities and Exchange Organization of Iran were used to measure regulatory scrutiny. Empirical results show that audit committee financial expertise increases (decreases) regulatory scrutiny when audit committee independence is low (high). This paper informs the cost-benefit debate on audit committee financial expertise. It contributes to the literature by showing that regulatory scrutiny is jointly influenced by the audit committee independence and financial expertise. The paper is of interest to researchers and shareholders, boards of directors, and other practitioners who wish to improve the composition and quality of audit committees, especially in emerging markets where corporate governance codes are still developing.
Subject
Marketing,Strategy and Management,Industrial relations,Business and International Management,Business, Management and Accounting (miscellaneous),Management of Technology and Innovation,Management Science and Operations Research,Information Systems and Management,Organizational Behavior and Human Resource Management