Prior research has indicated that
the effectiveness of these audit committees has an important effect on the corporate
governance process within an organization. In a Canadian study, Goh (2009) found
the effectiveness of a firm’s independent audit committee to be associated with that
firm’s timeliness in remediating material weaknesses in internal control, thereby
helping to improve financial reporting quality and, ultimately, enhancing corporate
governance.
. In view of the demonstrated significance of the audit
committee effectiveness variable, the following hypothesis is proposed: