Accounting Background of Directors and Supervisors and Internal Control Weakness

• Main Authors: Ya-Chu Hsu, 許雅筑
• Other Authors: Hung-Shu Fan
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/12834098342581449048

碩士 === 輔仁大學 === 會計學系碩士班 === 102 === Since 2002, Taiwan has gradually introduced the independent director and supervisors related systems and regulates that the independent directors/ supervisors of IPO firms must have more than 5 years of work experiences for commercial affairs, law, finance, accounting or business. Moreover, one of them shall have accounting or financel profession. In recent years, Taiwan requires IPO firms to set up the Audit Committee. Moreover, members of the Audit Committee shall be independent directors, and the number of members shall be more than three, plus one of them must have accounting or finance profession. Therefore, this study aims to examine the effect of directors’ / supervisors’ accounting profession on internal control weakness (hereafter, ICW). The sample firms include firms listed on the Taiwan Security Exchange Corporation and GreTai Securities Market in Taiwan during 2006-2012. The empirical result of this study shows that the relationship between directors’ / supervisors’ accounting profession and ICW is significantly negative. This study conducts several sensitivity tests, including replacing ICW dummy variable with the fines and the frequency of the penalty due to weak internal control test, and replacing other directors’ / supervisors’ background vaiables. The empirical results of these several sensitivity tests show that the previous findings do not alter.