1. Introduction An important dimension of audit committee (AC) effectiveness that has gained the attention of regulators and academics is the financial expertise of AC members ( General Accounting Office 1991 ; Public Oversight Board 1993 ; Kalbers and Fogarty 1993 ; DeZoort 1997, 1998 ; Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees 1999 ; DeZoort, Hermanson, Archambeault, and Reed 2002 ; Sarbanes‐Oxley Act of 2002 [SOX] 2002 ; Cohen, Krishnamoorthy, and Wright 2004 ). Section 407 of SOX requires the Securities and Exchange Commission (SEC) to adopt rules mandating that the AC of public firms include at least one member who is a financial expert or disclose reasons for not adopting this requirement. While SOX proposes a narrow definition of financial expertise, to include individuals with experience in accounting or auditing, the SEC controversially adopted a broader definition of financial expertise that includes accounting and certain types of nonaccounting (finance and supervisory) financial expertise. The controversy surrounding the definition of what constitutes a financial expert has given rise to an avenue of academic research on the effects of accounting and nonaccounting financial expertise in ACs on financial reporting quality (e.g., Carcello, Hollingsworth, Klein,
Contemporary Accounting Research – Wiley
Published: Sep 1, 2010
It’s your single place to instantly
discover and read the research
that matters to you.
Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.
All for just $49/month
Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly
Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.
Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.
Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.
All the latest content is available, no embargo periods.
“Hi guys, I cannot tell you how much I love this resource. Incredible. I really believe you've hit the nail on the head with this site in regards to solving the research-purchase issue.”Daniel C.
“Whoa! It’s like Spotify but for academic articles.”@Phil_Robichaud
“I must say, @deepdyve is a fabulous solution to the independent researcher's problem of #access to #information.”@deepthiw
“My last article couldn't be possible without the platform @deepdyve that makes journal papers cheaper.”@JoseServera