 Corporate Boards, Audit Committees, and Earnings Management: Pre‐ and Post‐SOX EvidenceAloke Ghosh, Antonio Marra and Doocheol Moon Journal of Business Finance & Accounting, 2010, vol. 37, issue 9‐10, 1145-1176 Abstract: Abstract: Primarily motivated by the claims that the recent regulatory initiatives empowering boards and audit committees restrain earnings management, we examine whether board characteristics (composition, size, and structure) and audit committee characteristics (composition, size, activity, expertise, ownership, and tenure) are associated with earnings management before and after Sarbanes‐Oxley Act (SOX). Using absolute performance‐adjusted discretionary accruals, special items, and deferred tax expense as alternative constructs for earnings management, we find that earnings management does not vary with board composition and structure, or with audit committee composition, expertise, and ownership. In contrast, board size and audit committee size, activity, and tenure are associated with earnings management. More important, the strength of this association is considerably weaker for the post‐SOX years compared to the pre‐SOX years. Finally, we find no evidence to suggest that the overall level of earnings management declined following SOX. Date: 2010 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:jbfnac:v:37:y:2010:i:9-10:p:1145-1176 Ordering information: This journal article can be ordered from Access Statistics for this article Journal of Business Finance & Accounting is currently edited by P. F. Pope, A. W. Stark and M. Walker More articles in Journal of Business Finance & Accounting from Wiley Blackwell |
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