Audit fees, board ethnicity and board independence: evidence from South Africa

IF 2.8 3区 管理学 Q2 BUSINESS, FINANCE Managerial Auditing Journal Pub Date : 2022-02-23 DOI:10.1108/maj-06-2020-2697
Balachandran Muniandy
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引用次数: 3

Abstract

Purpose The purpose of this paper is to examine the relationship between ethnic diversity on corporate boards and audit fees in the context of South Africa. Additionally, this paper investigates how the interaction between board ethnicity and board independence affects audit fees. Design/methodology/approach This study uses a quantitative research method with a panel data analysis to test proposed hypotheses. This study’s sample consist of listed firms on the Johannesburg Stock Exchange (JSE) from 2003 to 2018. Findings This study finds that firms with more Black directors on corporate board have higher audit fees. It also shows that the positive relation between board independence and audit fees is more pronounced for firms with greater ethnic diversity on corporate boards. Further, this study finds that the presence of Black directors on corporate board can increase board effectiveness. Lastly, firms with more Black directors on corporate board tend to be audited by Big N auditors. The findings of this study illustrate the implication of an equity narrative to board diversity for organisational outcome. Research limitations/implications The results reported in this paper have both practical and policy implications regarding the presence of ethnic diversity on corporate boards. The findings also suggest that there is a need to establish an appropriate balance of ethnic diversity on corporate boards as part of regulatory reform. Regulators should be aware of the positive impacts of the requirement for board diversity on corporate boards. Originality/value To the best of the authors’ knowledge, this is the first study to examine whether the presence of Black directors on corporate boards affects audit fees. It also investigates the interaction effects between the presence of Black directors on the board and board independence.
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审计费用、董事会种族和董事会独立性:来自南非的证据
本文的目的是研究南非背景下公司董事会种族多样性与审计费用之间的关系。此外,本文还探讨了董事会种族和董事会独立性之间的相互作用如何影响审计费用。设计/方法/方法本研究采用定量研究方法和面板数据分析来检验提出的假设。本研究的样本包括2003年至2018年在约翰内斯堡证券交易所(JSE)上市的公司。研究发现:黑人董事越多的公司,其审计费用越高。研究还表明,在董事会种族多元化程度较高的公司,董事会独立性与审计费用之间的正相关关系更为明显。此外,本研究发现,黑人董事在公司董事会的存在可以提高董事会的有效性。最后,董事会中黑人董事较多的公司往往会接受大N审计师的审计。本研究的结果说明了股权叙事对董事会多样性对组织结果的影响。研究局限/启示本文报告的结果对公司董事会中种族多样性的存在具有实际和政策意义。研究结果还表明,作为监管改革的一部分,有必要在公司董事会中建立种族多样性的适当平衡。监管机构应该意识到董事会多元化要求对公司董事会的积极影响。原创性/价值据作者所知,这是第一个检验公司董事会中黑人董事的存在是否会影响审计费用的研究。它还研究了黑人董事在董事会中的存在与董事会独立性之间的相互作用。
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来源期刊
CiteScore
5.40
自引率
13.80%
发文量
45
期刊介绍: The key areas addressed are: ■Audit and Assurance (financial and non-financial) ■Financial and Managerial Reporting ■Governance, controls, risks and ethics ■Organizational issues including firm cultures, performance and development In addition, the evaluation of changes occurring in the auditing profession, as well as the broader fields of accounting and assurance, are also explored. Debates concerning organizational performance and professional competence are also covered.
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