The Effects of Family CEO's on the Board Independence, Audit Independence and Transparency

2020 ◽  
Vol 23 (2) ◽  
pp. 25-47
Author(s):  
Tae-woo Woo ◽  
Keyword(s):  
Board Independence ◽  
Audit Independence

A HISTORICAL PERSPECTIVE ON THE AUDITOR'S ROLE: THE EARLY EXPERlENCE OF THE AMERICAN RAILROADS

1983 ◽  
Vol 10 (1) ◽  
pp. 69-86 ◽  
Author(s):  
James L. Boockholdt
Keyword(s):  
United States ◽  
Nineteenth Century ◽  
Internal Control ◽  
Historical Perspective ◽  
The United States ◽  
Advisory Services ◽  
Audit Independence ◽  
Inherent Part

The paper explores the origins of the auditing profession in the United States. It is suggested that the development of the audit function in this country can be traced to reporting by internal and shareholder auditors in the American railroads during the middle of the nineteenth century. Evidence is presented that a recognition of the need for audit independence existed, and that the provision of advisory services and reports on internal control by American auditors have been an inherent part of the auditor's role from that time.

Board Independence and Internal Control Weakness: Evidence from SOX 404 Disclosures

2016 ◽  
Vol 36 (2) ◽  
pp. 45-62 ◽  
Author(s):  
Yangyang Chen ◽  
W. Robert Knechel ◽  
Vijaya Bhaskar Marisetty ◽  
Cameron Truong ◽  
Madhu Veeraraghavan
Keyword(s):  
Internal Control ◽  
Internal Controls ◽  
Board Independence ◽  
Negative Relation ◽  
Internal Control Weaknesses ◽  
A Company ◽  
Jel Classifications

SUMMARY In this paper, we investigate whether board independence has an impact on the likelihood that a company reports weaknesses in internal controls. Using a sample of 11,226 firm-year observations spanning the period 2004–2012, we establish several findings. First, we document a negative relation between board independence and the disclosure of internal control weaknesses. We also document that the negative relation is stronger for firms with unitary leadership (combined positions of CEO and chairman) than for firms with dual leadership. Next, we show that board independence is associated with both fewer account-specific and company-level weaknesses. Finally, we show that board independence is associated with timely remediation of internal control weaknesses and that the implementation of Auditing Standard No. 5 in 2007 weakens the effect of board independence on the disclosure of ICW. JEL Classifications: G10; G18.

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