Impact of compositions and characteristics of board of directors and earnings management on fraud

This paper examines the effects of board of directors characteristics and compositions, earnings management on fraud for Taiwan listed SES and OTC companies. The effects of Institutional director holding, the duality of board chair and CEO have not influence on fraud before the act of the independent directors and auditor, but Institutional director holding, the duality of board chair and CEO has negative influence on fraud afterward. The discretionary working capital accrual has not influence on fraud and the interaction of institutional director holding and the discretionary working capital accrual has negative influence on fraud before the act of the independent directors and auditor, but the discretionary working capital accrual has negative influence on fraud afterward. The interaction of independent director holdings and the discretionary accrual has positive influence on fraud after the act of the independent directors and auditor. It is ironical to promotion of the corporate government system in Taiwan that increasing independence director holdings would increase the influence of discretionary accrual on fraud.