Incentives For The Audit Committee To Signal Their Monitoring Activities Using Voluntary Disclosure In The Audit Committee Report

Download or read book Incentives for the Audit Committee to Signal Their Monitoring Activities Using Voluntary Disclosure in the Audit Committee Report written by Matthew Ray Reidenbach and published by . This book was released on 2013 with total page 206 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation considers whether the audit committee report is used as a signal for the audit committee's monitoring effort. Prior audit committee report research suggests that a shift toward greater voluntary disclosure occurred after the passage of the Sarbanes-Oxley Act (Pandit et al. 2006). Using agency theory and signaling theory, this dissertation considers several incentives for voluntary disclosure for audit committees to signal their monitoring activity to shareholders: their financial expertise, their reputation, and their compensation structure. Studying a high litigation industry, this dissertation tests whether these incentives are associated with greater voluntary disclosure, providing evidence that both financial expertise and compensation structure are significantly associated with voluntary disclosure. Building upon a small stream of audit committee report literature, this dissertation contributes to the literature by studying voluntary disclosure in a non-traditional setting and providing evidence that audit committees may use their report to signal their unobservable monitoring effort.