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PRESENTATION TO DELOITTE AND TOUCHE_ LLP

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PRESENTATION TO DELOITTE AND TOUCHE_ LLP Powered By Docstoc
					   FEDERATION OF SCHOOLS OF
ACCOUNTANCY/DELOITTE & TOUCHE
     FACULTY CONSORTIUM


 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
          RESEARCH AND TEACHING


          Ganesh Krishnamoorthy
            Associate Professor
          Northeastern University

               May 17, 2003
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
         RESEARCH AND TEACHING



We now have a significant body of knowledge from prior research tells
  us, among other things, about:
 How corporate governance impacts (or is associated with) financial
  reporting quality

 How corporate governance affects the assurance provided by the
  external audit function

 What makes boards and audit committees effective in fulfilling their
  financial oversight responsibilities
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
              RESEARCH AND TEACHING


 Where and how are issues related to corporate
  governance addressed in the accounting curriculum?
   No systematic evidence (that I could find).
   An informal survey of accounting faculty at Northeastern
    University reveals that the coverage of corporate governance
    issues in most courses is ad-hoc and uses few “structured”
    pedagogical approaches such as readings, cases, etc.
   Is there adequate coverage in textbooks?
   Few instructional cases in Issues in Accounting Education.
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
         RESEARCH AND TEACHING



Current Research (with Arnie Wright & Jeff Cohen at Boston College):

Does the type (“agency” and “resource dependence”) and strength of
  the corporate board impact auditors’:
  1. Program planning (audit scope) judgments;
  2. Inventory obsolescence and valuation judgments; and
  3. Assessments about the audit committee’s role in helping resolve
  potential disagreements with the management?
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
         RESEARCH AND TEACHING



Case used in the research:
 Realistic case drawn from the SEC filings of a real firm where
  there’s an inventory obsolescence/salability issue.
 Pilot and post-experimental tests were conducted to check the
  realism of the case.

Instructional Case:
 Dynamic Data: Corporate Governance and the Quality of Financial
   Reporting
 Designed for use in a financial reporting, auditing, or a
   management control systems course.
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
         RESEARCH AND TEACHING



Major learning objectives are to provide students with an
  understanding of:
     The “actors” involved in corporate governance and how they affect the
      particular financial reporting issue (inventory valuation) at hand.
     Factors impacting the effectiveness of the board of directors and the
      audit committee in fulfilling their financial oversight responsibilities.
     The “agency” and “resource dependence” roles of the board.
     The current regulatory and legal environment affecting governance.
     The ethical dilemmas that management may face and the role of the
      governance agents.
     Governance considerations when dealing with a multinational
      corporation/client.
 CORPORATE GOVERNANCE: SYNERGIES BETWEEN
         RESEARCH AND TEACHING



Additional areas where cases and other instructional resources can be
      particularly useful:
1.   Assessing the effectiveness of governance mechanisms in an
     organization.
2.   Governance mechanisms and their role in detecting or preventing fraud
     and deterring earnings management.
3.   Interaction among “actors” in the corporate governance “mosaic” and
     the resulting impact on financial reporting quality.
4.   Audit committees and their role in enhancing auditor independence.
5.   The role of governance mechanisms, especially audit committees, in
     helping resolve disagreements between the auditor and the
     management.
6.   Evaluation of governance in audit client acceptance/continuation
     decisions.
7.   The impact of governance factors in the audit process.

				
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posted:5/26/2012
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