Title: Audit committee characteristics and earnings conservatism in banking sector: empirical study from GCC

Authors: Allam Mohammed Mousa Hamdan

Addresses: Accounting and Economics Department, Ahlia University, Bahrain

Abstract: We examine four audit committee characteristics, including the audit committee independence, size of audit committee, audit committee diligence and financial experience of the audit committee members to identify if any of these characteristics differentially impact the earnings conservatism. The sample included 59 banks from Gulf Cooperation Council (GCC) countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates during the period of 2012–2016. To achieve this goal, the study measures earnings conservatism using market-to-book approach. By using panel fixed-effect regression, our analysis reveals that bigger audit committees with more independence and members with financial experience are more likely to be associated with earnings conservatism in GCC banks. We also find that the audit committee diligence has no impact on earnings conservatism.

Keywords: earnings/accounting conservatism; audit committee characteristics; GCC banks.

DOI: 10.1504/AAJFA.2020.104401

Afro-Asian Journal of Finance and Accounting, 2020 Vol.10 No.1, pp.1 - 23

Received: 21 Oct 2017
Accepted: 22 Mar 2018
Published online: 10 Jan 2020 *

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