The Impact of Board Composition and Ethnicity on Audit Quality: Evidence from Malaysian Companies
This paper examines the effect of board composition and ethnicity on audit quality using a sample of 100 companies under the Industrial Product sector listed on the Bursa Malaysia Main Board in 2002. The study uses audit fees as a proxy for audit quality and seeks to examine whether the proportion of the independent directors. CEO duality and ethnicity factor are associated with audit fees. We find that the proportion of independent director is significantly related audit fees. However, we do not find evidence that CEO duality and ethnicity factors are associated with audit fees. Overall, our result suggest that independent directors encourage the appointment of higher quality auditors to give greater assurance to investors that company financial statement are fairly presented.

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