Publication Date

5-3-2019

Document Type

Dissertation/Thesis

First Advisor

Riley, Mark

Degree Name

B.S. (Bachelor of Science)

Legacy Department

Department of Accountancy

Abstract

This study aimed to test the relationship between the companies’ financial performances and their effectiveness of internal control (IC) or the compliance to Sarbanes-Oxley Act (SOX) Section 404 in the manufacturing industry in the United States (US) capital market. This study uses secondary data obtained from Wharton Research Data Services (WRDS) of University of Pennsylvania and EDGAR Securities and Exchange Commission database. The secondary data used from the sources are from 2013 to 2017. The data from those years were used to see the relationship between the companies’ effectiveness IC during that period and their financial performances. The result of this study show that based on the means, companies with IC weakness tend to have lower Return on Assets (ROA) and Return on Equity (ROE) compared to companies with effective IC. Based on the statistical test, there is a positive correlation between ROA and ROE of manufacturing company from 2013 to 2017. However, the p-value from the tests indicated that it is statistically insignificant, implying that the industry is a more important determinant to companies’ financial performance (ROA and ROE) than their internal control.

Extent

56 pages

Language

eng

Publisher

Northern Illinois University

Rights Statement

In Copyright

Rights Statement 2

NIU theses are protected by copyright. They may be viewed from Huskie Commons for any purpose, but reproduction or distribution in any format is prohibited without the written permission of the authors.

Media Type

Text

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