Abstract: This study examines the impact of ownership concentration, board
features and external audit on related party transactions (RPTs) of listed firms
in four Gulf Cooperation Council (GCC) countries, namely Bahrain, KSA,
Kuwait and UAE. A sample of 460 firm-year observations was investigated
during 2016–2018. Six models of hierarchical multiple regression (HMR) were
performed to regress five independent variables (ownership concentration,
board size, role duality, board independence, audit quality) on RPTs which
include three transactions (key management compensation, due from RP and
due to RP). HMR results indicate that ownership concentration, board size and
board independence are associated with only one type of RPTs, which is key
management compensation by listed firms in GCC countries. However, other
types of RPTs are not explained by most of independent variables. Providing
practical evidence on listed firms in GCC may provide a new dimension on this
part of empirical accounting research and may help in improving governance
practices. This research is the first attempt in the Gulf region to investigate the
impact of CG mechanisms on RPTs. It makes a unique contribution and
enrichment to this area of the accounting research in emerging markets in general and in GCC countries in particular. |
