Does Audit Committee Competence Moderate The Relationship Between Board Of Directors’ Attributes And Financial Sustainability? Evidence From Municipalities In Ghana

Abstract

The study aimed to establish the moderating effect of audit committee competence on the relationship between board of directors’ attributes and financial sustainability of municipalities. The study used a survey approach and census balanced panel data design. The pri[1]mary data using structured questionnaire was distributed to 621 chief audit executives and board of directors and audit committee chairpersons in 207 out of the 260 municipalities. The study sampled observations for a five-year period (from 2016 to 2020) with 1035 observations for 207 municipalities. Data collected were analysed using partial least square-structural equation modelling. The findings indicated that all the variables (board size, board independence, board gender diversity, and audit committee competence) have a direct significant relationship with financial sustainability. The findings also showed that audit committee competence significantly moderates the relationship between board gender diversity and financial sustainability. However, audit committee competence does not have a significant moderating effect on the relationship between board size, board independence and financial sustainability.