Board Independence, Audit Quality and Earnings Management: Evidence from Egypt

Aydin Ozkan, Mohamed Khalil

Research output: Contribution to journalArticlepeer-review

52 Citations (Scopus)


Using a unique dataset for Egyptian firms, we investigate the relationship between board independence, audit quality and earnings management. We test whether firm-level corporate governance provisions matter in an emerging market setting characterised by weak legal enforcement and inadequate external discipline by the market for corporate control. Our results cast doubt on the notion that a higher ratio of non-executive members is associated with lower earnings management. We find that the effect of board independence on earnings management practices is contingent on the levels of ownership held by executive directors and large shareholders, as well as the composition of audit committee. In addition, the results are consistent with the view that high-quality auditors are effective in reducing earnings management. JEL Classification: M41, M48

Original languageEnglish
Pages (from-to)84-118
Number of pages35
JournalJournal of Emerging Market Finance
Issue number1
Early online date7 Feb 2016
Publication statusPublished - 1 Apr 2016
Externally publishedYes


Dive into the research topics of 'Board Independence, Audit Quality and Earnings Management: Evidence from Egypt'. Together they form a unique fingerprint.

Cite this