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| Author: | Groff, M.Z. Valentincic, A. |
| Title: | Determinants of voluntary audit committee formation in a two-tier board system of a post-transitional economy - the case of Slovenia |
| Journal: | Accounting in Europe
2011 : VOL 8:1-2, p. 235-256 |
| Index terms: | accounting auditing audit committees board of directors case studies Slovenia |
| Freeterms: | post-transition economies |
| Language: | eng |
| Abstract: | This paper deals with the determinants of voluntary audit committee (AC) formation in a setting characterized by: i. a 2-tier board system, ii. a post-transitional economy. The system of incentives influencing the decision to form an AC is possibly affected by both factors i. and ii. Only 17 percent of companies in this study's sample had voluntarily established ACs by the time ACs had got mandatory by law. It is found that larger firms, firms with larger supervisory boards and firms with less debt are more likely to have voluntarily established an AC. Although the inverse relationship btw. debt and AC formation contradicts the debt holder-manager conflict, it can be explained in the context of a post-transitional economy. |
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