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A research note: The informational benefits of CEO attendance-by-invitation at audit committee meetings

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  • Johnston, Joseph
  • Nowland, John

Abstract

This study contributes to the policy debate about independent audit committees by examining the occurrence and consequences of CEO attendance-by-invitation at audit committee meetings. We investigate whether this is a way for powerful CEOs to exert their influence over audit committee matters or an informal channel for information sharing between management and audit committees. We find that CEO attendance-by-invitation at audit committee meetings is positively related to firm complexity and firm governance practices, and is associated with lower earnings opacity. These results are consistent with CEO attendance-by-invitation at audit committee meetings enhancing information sharing between firm management and audit committees. Thus, this study identifies significant benefits from allowing CEOs to act as informal advisors at audit committee meetings.

Suggested Citation

  • Johnston, Joseph & Nowland, John, 2017. "A research note: The informational benefits of CEO attendance-by-invitation at audit committee meetings," Journal of Contemporary Accounting and Economics, Elsevier, vol. 13(2), pages 108-118.
    • Handle: RePEc:eee:jocaae:v:13:y:2017:i:2:p:108-118
    DOI: 10.1016/j.jcae.2017.05.006
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    Cited by:

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    2. Abdul Ghafoor & Rozaimah Zainudin & Nurul Shahnaz Mahdzan, 2019. "Factors Eliciting Corporate Fraud in Emerging Markets: Case of Firms Subject to Enforcement Actions in Malaysia," Journal of Business Ethics, Springer, vol. 160(2), pages 587-608, December.

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    More about this item

    Keywords

    Accounting quality; Attendance-by-invitation; Audit committee; CEO; Information sharing;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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