Summary of Accounting, Auditing, & Government Articles

Summary of Accounting, Auditing, & Government Articles

Introduction

Audit committees are becoming main attractions in the financial arena. Bankruptcies, financial meltdowns, and crashes all have indicated the need of these institutions. In the United States of America, the stock market and financial indicators have stated that the nation is struggling with increasing debt. Even the current debate over the presidential campaign between President Obama and candidate Romney highlights the financial crisis occurring in the region.

The following is a summary on a trio of researches conducted on audit committees and their importance in the financial world. The first study concerns how informal process and behavioral reactions affect the audit committee. The second study indicates the main purpose and how important corporate governance is on audit committees. The third study elaborates on audit committee effectiveness through each individual involve in the organization and how their emotions reflect their performance.

Audit Committee Effectiveness: Informal Processes and Behavioral Effects

The research examined from this article instigates the critical requirements and methods influencing activities and possible success of audit committees (AC). The key variables highlighted include conversations with the AC, employees in the financial accounting, in-house audit operations, and outside auditors. The case study was utilized in collecting the observations required with employees being involved in AC functions. The personnel included the head of AC, company auditors, outsourced auditors, and senior management.

The findings discovered suggest that there is an existence of an informal network among AC staff that directly affects their involvement in the AC. Furthermore, the most impact of AC on authority decisions on the organization infrastructure and practices are made externally. The committee displays behavioral impressions inside the company, which can be utilized as a risk, a support, or as an intermediary in solving problems to disputes. The case ...