Journal article
The Effect of Governance Reforms on Financial Reporting Fraud
Journal of law, finance and accounting, Vol.1(2), pp.235-274
2016
DOI: 10.1561/108.00000005
Abstract
In response to financial reporting scandals, Congress and the
securities exchanges mandated increases in board and audit
committee independence and banned most non-audit services.
We exploit these exogenous shocks to examine whether
these governance reforms reduced financial reporting fraud.
Comparing firms forced to comply with the reforms to firms
already in compliance, we find that mandated increases in
overall board independence significantly reduced the rate of
fraud, while mandating a fully independent audit committee
had a weaker effect. Further, banning non-audit services
did not reduce the incidence of fraud.
Details
- Title: Subtitle
- The Effect of Governance Reforms on Financial Reporting Fraud
- Creators
- Dain C. Donelson - The University of Texas at AustinJohn McInnis - The University of Texas at AustinRichard D. Mergenthaler - University of Iowa
- Resource Type
- Journal article
- Publication Details
- Journal of law, finance and accounting, Vol.1(2), pp.235-274
- Publisher
- Now Publishers
- DOI
- 10.1561/108.00000005
- ISSN
- 2380-5005
- eISSN
- 2380-5013
- Number of pages
- 40
- Language
- English
- Date published
- 2016
- Academic Unit
- Accounting; Law Faculty
- Record Identifier
- 9984380543702771
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