The Relationship Between CFO Qualifications and Internal Control Weakness

Yeh Yaying C. (), Venezia Chiulien C. () and Yang Tzu-Ya ()
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Yeh Yaying C.: An Associate Professor of Framingham State University, Department of Accounting, Economics, and Finance, USA
Venezia Chiulien C.: Professor of Frostburg State University, Department of Accounting, USA
Yang Tzu-Ya: Is a staff of Deloitte and Touche, USA

Financial Internet Quarterly (formerly e-Finanse), 2022, vol. 18, issue 2, 21-29

Abstract: This study explores the relationship between CFO qualifications and a firm’s internal control weakness (ICWs). We use three measures for CFO competence: financial/accounting background, seniority, and education. Using a sample of Taiwanese listed firms from 2012 to 2015, the results of this study show a negative relationship between CFO financial/accounting background and seniority with internal control weakness, indicating firms with higher quality CFOs experience a lower number of ICWs. CFO education level, however, is not related with a firm’s internal control weakness. The results imply that capable CFOs can effectively implement a good internal system. The result of this study provides practical and policy implications.

Keywords: CFO qualification; Financial Accounting background; CFO competence; Seniority; Internal control weakness (search for similar items in EconPapers)
JEL-codes: M12 M4 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:finiqu:v:18:y:2022:i:2:p:21-29:n:6

DOI: 10.2478/fiqf-2022-0010

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