ECON 1 Lecture Notes - Ceo Succession, Social Loafing, Agency Cost
Document Summary
The audit committee: management watchdog or personal friend of the ceo? (p. 113-118 and 141-142) Auditors are less likely to issue going-concern opinions or to report internal control weaknesses. Social ties through advice networks do not seem to hamper the quality of audit committee oversight (neither professional or educational ties) advice networks. Specialists or experts consulted for their expertise and competence in work- related matters network of interpersonal links with members of other companies or members who share similar views or expertise based on their education. After the different scandals, many legislators have increased responsibilities and tasks of the audit committee is also required that each member is independent (but often have external connections) Key issues raised during the audit committee meetings are the accuracy of financial reporting and the quality of the audits. Critical to oversight quality is whether audit committees can sufficiently mitigate management pressure on auditors when disputes arise about an auditor"s reporting intentions.
