Corporate governance and financial authority sanctions
by Nadia Smaili; Bernard Sinclair-Desgagné
International Journal of Managerial and Financial Accounting (IJMFA), Vol. 6, No. 1, 2014

Abstract: The objective of this paper is to examine the joint effect of the board of directors and the auditor on the severity of sanctions imposed by the financial authority. Based on a theoretical model and using a unique dataset, we find that the board of directors and its audit committee play a crucial role when a firm faces financial authority sanctions: the board has a negative effect on the severity financial authority sanctions, while an auditor's effort has no significant impact. In particular, results show that the presence of independent and financial experts on both the board of directors and the audit committee can deter the severity of financial authority sanctions. However, our results suggest that firms that recently hired a Big 4 auditor see no significant impact.

Online publication date: Wed, 02-Jul-2014

The full text of this article is only available to individual subscribers or to users at subscribing institutions.

 
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.

Pay per view:
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.

Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Managerial and Financial Accounting (IJMFA):
Login with your Inderscience username and password:

Username:        Password:          Forgotten your password?

Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.

If you still need assistance, please email subs@inderscience.com