the third-party perceptions of auditor independence. Wild
(1996), however, found evidence that establishment of an
AC enhances earnings quality, and Goodwin-Stewart and
Kent (2006) found that an AC is associated with ‘higherquality’
audits.Similarly,DeFond’s (1991, 2005) study
revealed that “over-statements of earnings are less likely
among firms that have an AC,” while Dechow’s (1996) study
found that “corporations manipulating earnings are more
likely to have boards of directors dominated by managers
and less likely to have an AC.”Williams and Tower (2004)
conducted a comprehensive simultaneous analysis of the
association between five AC composition and operational
characteristics features and earnings management based on
a sample of 485 Singapore publicly traded organizations.