Audit Committee Characteristics and Financial Restatements

This study examines the audit committee characteristic's effect on financial restatements. These characteristics include independence, size and expertise of its members. For investigations of this topic, a sample of 136 companies (544 observations) listed in the Tehran stock exchange during the years 1391 to 1394 and their data were analyzed. To test the hypothesis logit model (logistic regression) was used. The results showed that, there is a significant negative relationship between independence and expertise of the audit committee members with financial restatements, while the relationship between audit committee size and financial restatements is not significant. In summary, the evidence showed that Audit Committee characteristic's affect restatements and audit Committee can strengthen the company's internal control structure, board monitoring responsibility and effectiveness of independent auditors will increase by reducing the likelihood of misstatement.