Audit Committees and Corporate Governance in a Developing Country

29 Pages Posted: 21 Jun 2008 Last revised: 19 Jan 2009

See all articles by Nelson Waweru

Nelson Waweru

York University - School of Administrative Studies

Riro G. Kamau

University of Nairobi

Enrico Uliana

University of Cape Town (UCT) Retired

Date Written: June 18, 2008

Abstract

Market regulators, commissions and accountancy bodies have recommended the establishment of audit committees as an important step in improving corporate governance. In 2002 the Kenya Capital Markets Authority required all listed companies to establish audit committees. This study examined the role of audit committees in corporate governance in Kenyan listed companies. In particular, how audit committees operate in a developing country such as Kenya and how these practices compare with those of western economies and other emerging economies; how audit committees relate to management, internal audit, and external auditor; and the major achievements and challenges facing audit committees in Kenya. A questionnaire survey completed by 29 companies (60%) showed much similarity to studies in major economies. However, skills shortage and dominant shareholder or government may have affected the operations of audit committees. All the audit committees reported cordial relationships with the management, internal audit and the external auditors, and were perceived to have improved the quality of financial reporting.

Keywords: Audit committees, Corporate governance, Kenya, Listed Companies, Internal audit, External audit

JEL Classification: M49, M41, M47, G34, G38, G15, C99

Suggested Citation

Waweru, Nelson Maina and Kamau, Riro G. and Uliana, Enrico, Audit Committees and Corporate Governance in a Developing Country (June 18, 2008). AAA 2009 Management Accounting Section (MAS) Meeting Paper. Available at SSRN: https://ssrn.com/abstract=1147893 or http://dx.doi.org/10.2139/ssrn.1147893

Nelson Maina Waweru (Contact Author)

York University - School of Administrative Studies ( email )

4700 Keele St.
Toronto, Ontario M3J1P3
Canada
+14167362100 (Phone)
+14167365963 (Fax)

Riro G. Kamau

University of Nairobi ( email )

Nairobi
Kenya

Enrico Uliana

University of Cape Town (UCT) Retired ( email )

South Africa

Register to save articles to
your library

Register

Paper statistics

Downloads
1,055
Abstract Views
4,571
rank
19,950
PlumX Metrics