This study examines decisions relating to the composition of audit committees by foreign private issuers (FPIs) that are listed on US exchanges. A firm listed on the US stock market must have an audit committee consisting of at least three financially literate independent directors, and disclose if it has at least one financial expert. Although FPIs are exempted from these requirements, 72 percent of FPIs choose to opt into complying with them. I find that FPIs from countries with a greater number of differences in audit committee requirements compared to US requirements are less likely to opt-in. Firms from weak investor protection countries are more likely to opt-in. Because FPIs are not mandated to follow US audit committee requirements, their opt-in choices indicate greater benefits (possibly from “bonding” to a rigorous regulatory setting) than compliance costs. Further investigation into the consequences of opting in show that FPIs opting into the US audit committee requirements are less likely to restate their financial statements or disclose internal control material weaknesses, have less earnings management, and hence have better financial reporting quality. / Business Administration/Accounting
| Identifer | oai:union.ndltd.org:TEMPLE/oai:scholarshare.temple.edu:20.500.12613/7988 |
| Date | January 2022 |
| Creators | Lu, Lu |
| Contributors | Krishnan, Jayanthi, Krishnan, Jagan, Liang, Yi, Wattal, Sunil |
| Publisher | Temple University. Libraries |
| Source Sets | Temple University |
| Language | English |
| Detected Language | English |
| Type | Thesis/Dissertation, Text |
| Format | 108 pages |
| Rights | IN COPYRIGHT- This Rights Statement can be used for an Item that is in copyright. Using this statement implies that the organization making this Item available has determined that the Item is in copyright and either is the rights-holder, has obtained permission from the rights-holder(s) to make their Work(s) available, or makes the Item available under an exception or limitation to copyright (including Fair Use) that entitles it to make the Item available., http://rightsstatements.org/vocab/InC/1.0/ |
| Relation | http://dx.doi.org/10.34944/dspace/7960, Theses and Dissertations |
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