The Study of Factors Affecting the Quality of Audit Committee

The expansion of private ownership scope, through privatization of state owned enterprises and decentralization has increased the attention towards the capital owners' interests to strengthen accountability culture and to promote the information transparency of companies and other economic units in which all or a part of capital is supplied by the public. This aims to require mechanisms to ensure the proper governance in companies and other economic firms. Corporate governance has particular elements. Audit committee is a key element of corporate governance that strengthens the health of financial reporting. In the current study it is attempted to examine factors affecting the quality of the audit committee. The research sample includes all financial managers or board members of listed companies in the Tehran stock exchange in which the final sample consists of financial managers or board members of 185 listed companies. The research results indicate that the enhancement in independency, expertise and activities of non-executive members of board increases independency, expertise and activities of the audit committee and also there is a meaningful relationship between the size of non-executive members of board and the size of the audit committee.