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Monitoring costs of multinational companies: an agency theory perspective


Citation

Mustapha, Mazlina (2014) Monitoring costs of multinational companies: an agency theory perspective. Asian Journal of Business and Accounting, 7 (2). pp. 23-43. ISSN 1985-4064; ESSN: 2180-3137

Abstract

This paper investigates the agency costs of multinational companies (MNCs) in relation to agency theory, in the Malaysian business environment. Using the data of 235 MNCs, this study explores their demand for monitoring costs and these companies' preferences between the monitoring costs components. The result indicates that MNCs incur significantly higher monitoring costs compared to domestic companies. However, the relationship between these companies and their preference between the components of the monitoring mechanisms, that is between directorship and auditing as their monitoring mechanism, is not significant. When the auditing components are further investigated, it reveals that MNCs incur more external audit costs compared to internal audit costs.


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Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
Publisher: Faculty of Business and Accountancy, University of Malaya
Keywords: Agency costs; Directorship; Domestic companies; External audit; Internal audit; Monitoring; Multinational companies
Depositing User: Nurul Ainie Mokhtar
Date Deposited: 16 Dec 2015 03:27
Last Modified: 01 Nov 2016 07:07
URI: http://psasir.upm.edu.my/id/eprint/34595
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