The contingent effects of board independence and audit committee effectiveness on internal audit reliance: a pre-SOX perspective

Ganesh Krishnamoorthy and Mario Maletta

International Journal of Accounting and Finance, 2016, vol. 6, issue 1, 62-85

Abstract: The period leading up to the Sarbanes-Oxley Act (SOX) witnessed criticism levelled against the auditors regarding audit failures, but limited research exists exploring the positive effects of auditor judgements during the pre-SOX period. This paper explores one such context by examining whether external auditors' judgements relating to internal audit were affected by the audit committee governance strength and accounting expertise, and the level of board independence. Results indicate that the greater the governance strength and accounting expertise of the audit committee, the greater the assessed quality of internal audit, and the greater the overall level of coordination between internal and external audit. Findings also indicate that the positive effects of audit committee characteristics on the external audit process may be attenuated by board independence. Collectively, findings reveal the contingent effects of board independence and audit committee governance and accounting expertise on the relationship between internal and external auditors.

Keywords: internal audit; board of directors; auditing; board independence; audit committee effectiveness; pre-SOX; auditor judgements; external auditors; governance strength; accounting expertise; audit committees. (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.inderscience.com/link.php?id=76558 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ids:intjaf:v:6:y:2016:i:1:p:62-85

Access Statistics for this article

More articles in International Journal of Accounting and Finance from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker (informationadministrator5@inderscience.com).