Directors’ Independence, Internal Audit Function, Ownership Concentration and Earnings Quality in Malaysia
Bibliographic record
Abstract
Concentration of ownership in Malaysian public listed companies contributes to agency conflict betweenmajority and minority shareholders. An effective monitoring mechanism is critical to mitigate this conflict. Thestudy aims to examine the influence of board and audit committee independence, internal audit function andownership concentration on earnings quality proxied by discretionary accruals. The sample of the study 508companies listed on the Bursa Malaysia Main Market from 2009 to 2012. Two measures of discretionaryaccruals are used: Modified Jones model (Dechow et al., 1995); and extended Modified Jones Model (Yoon etal., 2006). Using OLS regression, results of the study suggest that audit committee independence and moreinvestment in internal audit function are related to higher earnings quality. However, board of directors’independence and ownership concentration are associated with lower earnings quality. The finding indicates theimportance of audit committee independence in producing quality financial reporting. Consistent findings arefound for most variables in both models. The findings of the study have implication on the use of measurementof discretionary accruals in earnings quality studies and corporate governance practices in Malaysia.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.003 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.001 | 0.001 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.001 | 0.001 |
| Open science | 0.000 | 0.001 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.002 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".