Senior Managers' Perceptions on Audit Committee Composition and Effectiveness : Some Evidence from Malaysia

The aim of this study is to investigate the perceptions of corporate management on the relationship of audit committee composition and effectiveness. Issues examined include status of audit committee members, member's financial literacy, status of chairman of audit committee, and good characteristics of an audit committee. It is found that audit committee effectiveness would be enhanced if the committee comprised a majority of non-executive directors. The respondents also believed that audit committee effectiveness would be enhanced if the majority of audit committee members financially literate, non-executive director assume the chairmanship of the committee. It is also found that a good characteristic of an audit committee is member that has good knowledge and understanding of the company's business activities