The effect of audit committee characteristics on financial reporting transparency: A research on the corporate governance index

As a result of accounting scandals caused by inadequate corporate governance practices and low-quality financial reports, confidence in the financial information presented by companies in the capital markets has decreased. It has become a necessity to prepare financial reports with a high level of transparency in order to secure the rights of stakeholders and regain public trust. In this context, it is argued that the audit committee plays a key role in fulfilling its responsibilities within the corporate governance approach and improving the financial reporting process. Starting from this point; The purpose of this study is to examine the relationship between audit committee characteristics and the level of transparency of financial reports submitted by the company. For this purpose, 402 firm/year data obtained from non-financial institutions traded in Borsa Istanbul Corporate Governance Index between 2007-2021 are analyzed with the least squares method and fixed effects model. The findings of the study indicate that there is a statistically significant positive relationship between the presence of female members in the audit committee and the frequency of meetings held by the audit committee throughout the year and the transparency level of the financial reports presented. It also reveals that there is a statistically significant negative relationship between the number of members of the audit committee and the transparency level of the financial reports presented. On the other hand, the findings of the study show that there is no statistically significant relationship between the experience and expertise of the audit committee and the transparency level of financial reports. The results of the research; provide evidence to policymakers, investors, and professional accountants about how audit committee characteristics relate to that committee's effectiveness in monitoring corporate reporting processes. Keywords: Corporate governance, audit committee, financial reporting transparency.