Internship Report On Earnings Management and Corporate Governance in Bangladesh (The Role of the Board and the Audit Committee)
Prepared for: Mr. Shubhankar Shil. Assistant Professor, School of Business University of Liberal Arts Bangladesh (ULAB)
Prepared by: Rashed Hossain ID: 092011001 Concentration: Finance School of Business University of Liberal Arts Bangladesh (ULAB)
April 27, 2013
Mr. Shubhankar Shil. Assistant Professor, School of Business University of Liberal Arts Bangladesh (ULAB)
Subject: Internship report on “Earnings Management and Corporate Governance in Bangladesh (The Role of the Board and the Audit Committee)”
Dear Sir: With due respect and honor that I have the great pleasure and opportunity to submit an internship report. I joined in the First Security Islami Bank Limited for the internship and worked on “Earning Management and Corporate Governance in Bangladesh (The Role of Board and Audit Committee)”. This report has attempted to focus on the earning management the role of corporate governance in reducing earning management. I have prepared this report with the best possible ways and have tried to make it as flawless as possible. I have thoroughly enjoyed preparing this report as a requirement of the internship program of Bachelor of Business Administration (BBA). Now, I would like to take this opportunity to ask you to kindly go through the report and judge it for yourself how far have I been successful in the attempts. Please be considerate to any unintentional errors.
Yours Sincerely, ...………………. Rashed Hossain ID: 092011001
I am thankful to my Almighty for providing me all the skill and support to be able to comprehend and accomplish this task.
The success of this report depends on the contribution of number of people specially those who have shared their considerate supervision and suggestions to complete this report.
First and foremost I offer my sincerest gratitude to my supervisor Mr. Shubhankar Shil. , who has supported me throughout my paper with her patience and knowledge even as allowing me the space to work in my own way. With his guidance encouraged me to think that everything is possible and thereby enabled me to cope with challenges in the research process. As a under graduate student, I feel fortunate to have had the guidance from sir and his vast knowledge and experience. I would like to give special thanks to Chief Controller First Security Islami Bank Limited; Mr. Mohammed Ruhul Quddus has been very accommodating in making it easier for me to carry out my tasks during the internship. I would also like to thanks to the Human Resource Management Department of First Security Islami Bank Limited for their kind cooperation for the internship. To get my practical knowledge and to prepare my Internship report, my working place played a very important role. I am lucky and feel proud to get the Internship in FSIBL, Mohammadpur (Ring Road) Branch. During my Internship period I got chance to work with the Senior Officers and Branch Manager. They inspired me work hard to know and gather adequate knowledge about the overall banking system.
Table of Contents
Contents 1. Introduction 2. Problem Statement 3. Purpose of the Study 4. Data Sources 5. Literature Review 5.1 Earning Management 5.2 Causes of Earning Management 5.3 Impact of Earning Management 5.4 The Role of Board 5.4.1 Board Composition 5.4.2 CEO Duality and Earnings Management 5.4.3 Board Structure 5.4.4 Board Size and Board Meeting
1 2 3 4 4 - 11 4 5 6 7 7 8 9 11
6. Statistical Methodology 7. Data
7.1 Sample Selection 7.2 Data 7.3 CEO Duality 7.4 Number of Board Meetings 7.5 Board Composition 7.6 Audit Committee 7.7 Executive Committee
13 - 14 13 13 13 14 14 14 14
8.1 Overall Board Results
8.2 Audit Committee Results
8.3 Executive Committee Results
15 - 16 15 15 16
9. Hypothesis Analysis 10. Conclusions 11. References 12....
References: Alonso, P., Palenzuela, V.,and Iturriaga, F. 2000. “Managers‟ Discretionary Behavior,
Earnings Management and Corporate Governance: An Empirical International Analysis”, Working Paper, Universidad de Valladolid
Yermack, D. (1996). Higher market valuation of companies with a small board of directors. Journal of Financial Economics 40: 185-211. Yu, F. 2008. “Corporate Governance and Earnings Management” Journal of Financial
Table 1 Descriptive Statistics on a Sample of 50 firma from 2009, 2010, and 2011
Table 2 Descriptive Statistics on a Sample of 50 firma from 2009, 2010, and 2011. The accrual information came from financial statement. Discretionary and Non-discretionary are computed following Theo, Welch, and Wong (1998a).
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