Corporate Governance and Audit Profession

by



Acknowledgement

I would take this opportunity to thank my research supervisor, family and friends for their support and guidance without which this research would not have been possible.

DECLARATION

I, [type your full first names and surname here], declare that the contents of this dissertation/thesis represent my own unaided work, and that the dissertation/thesis has not previously been submitted for academic examination towards any qualification. Furthermore, it represents my own opinions and not necessarily those of the University.

Signed __________________ Date _________________

Table of Contents

ABSTRACT5

CHAPTER 16

Introduction6

Background7

Problem Statement12

Purpose of the study19

Hypotheses20

Significance of Study23

Delimitations25

Outline of Study26

CHAPTER 227

Literature Review27

Features of Financially Distressed and Bankruptcy Firms28

Bankruptcy Prediction Models31

Univariate Analyses31

Multivariate Models32

Corporate Identity and Change37

CHAPTER 339

Methodology39

Research Design41

Sample and Data42

Variable Selection45

Evaluation of Research47

Reliability48

Validity48

CHAPTER 450

Findings50

Risk Management and Corporate Scandals Local and International55

Transparency, Accountability and Risk Management58

Professional Accounting Bodies and guidance in regards to Risk Management63

Recommendations79

Suggestions for further research80

REFERENCES82

Corporate Governance and Audit Profession

Abstract

This work contributes to the literature of corporate governance, the analysis of the impact of management characteristics of companies in the conclusions of the UK registered companies financing. In particular, they examined the effect of board size, thickness and property management companies in the Debt / Equity described. We use a form of multiple regression to analyze how the variables affect government operations in the period to which UK companies use investment responsibility of their activities. After controlling for the profitability and development potential, we find that both board size and thickening of the property positively associated with debt-equity ratio.

Corporate Governance and Audit Profession

Chapter 1

Introduction

This chapter provides a background about the keywords of this research paper; financial ratios, financial distress and bankruptcy. It also presents the statement problem, the purpose of the study, the hypotheses, significance and the delimitation of study. The introductory chapter finally presents a brief outline on how the entire report is organized.

Background

Financial ratios are the most commonly used in understanding and interpreting corporate financial statements and in evaluating company's performance over time. These ratios identify irregularities, abnormalities and surprises that require further investigation to ascertain the current and future financial standing of a company (Barry and Jamie, 2002:638). In order to add meaning to the ratios, a benchmark is required when traditional ratio analysis technique is used in analyzing financial statements. Trend analysis and cross sectional analysis are the most commonly used ratio analysis techniques. In trend analysis, the company's performance is compared over time therefore the benchmark could be its previous years' financial ratios, budgeted financial ratios for the same period or the financial ratios for other profit centres or costs centres (Barry and Jamie, 2002:638).

With cross sectional analysis, the benchmark is the financial ratios of another company either in the same industry or in a different industry. However, comparing companies based on their financial ratios may be hindered due to a number of factors1 (Soffer, 2003; Anne & Ann, 2007). For example, cross sectional analysis will be hampered if the financial statements of companies are prepared using different accounting practices and ...