This thesis contains an overview and examination of Danish listed companies’ establishment of Audit Committees. After the passing of the Danish Act on Registered and State-Authorised Public Accountants as a direct consequence of EU´s 8th Directive, it is now mandatory for listed companies to establish an Audit Committee, although via two derogations it is possible that the board of directors can take responsibility for the tasks of the Audit Committee. The objective of this examination is to highlight for which type of company an Audit Committee is relevant and objectively useful in a Danish context. Via information from 88 listed companies’ annual reports for Large- and Midcap companies the thesis seeks to define the need for Audit Committees compared to that of the Anglo-Saxon countries. Contributions to the Corporate Governance debate have mainly been influenced by the Anglo- Saxon countries especially where Audit Committees are concerned. It is in this connection found relevant, based on descriptive statistics, to be able to place Denmark in an International Corporate Governance perspective. The descriptive part of the thesis encapsulates an explanation/examination of the structure of Danish conditions: Management, company, board of directors and share markets, and how these differ from those of the Anglo-Saxon countries. The descriptive section contains in addition a general description of the Audit Committees function and arguments for and against Audit Committees. In the thesis’ empirical study an overview can be seen of the factors which tend to define what type of companies that establish Audit Committees. A research result of the thesis is that the special Danish relation to Corporate Governance differs to that of the Anglo-Saxon countries, not least in the average size of the listed companies and their boards of directors and also ownership structure. The differences due to size in the empirical study were enforced and confirmed, as it is for the most part companies listed on Largecap that have established Audit Committees in addition to companies with large boards. On the other hand it could not be confirmed that ownership structure inclusive companies with split share classes, had any definite impact on the establishment of Audit Committees. In conclusion we can summarise that the major influence for a company’s decision to establish an Audit Committee is mostly based on company size. In this respect it is therefore seen as a sensible disposition that the rules of exception to the requirements relating to the establishment of Audit Committees, in the Danish Act on Registered and State-Authorised Public Accountants, are a flexible set of rules allowing for those companies who believe that Audit Committees can add no value to the company.
|Educations||MSc in Auditing, (Graduate Programme) Final Thesis|
|Number of pages||118|