The Existence of the Constituents of Corporate Governance Related to Auditing Task and Company Management: Empirical Evidence from the Shareholding Corporations in Palestine

This study aims to investigate the existence of organizational constituents of corporate governance for the listed companies in Palestine Exchange [PSE]. Moreover, the listed companies in the PSE include 48 companies until the beginning of the year 2013. This study is implemented by conducting the opinions of three correspondents in these companies who firstly the chairmen and the board of directors. Secondly, departments’ managers, and finally the employees in the accounting departments of public shareholding companies listed in the PSE. Furthermore, regarding the organizational constituents of corporate governance. This study tests the existence of three constituents which are firstly, the constituent related to the process of auditing the financial statements. Secondly, the constituent related to the stockholders committee, and finally, the constituent related to the board of directors. The objectives of this study were matched by using questionnaire utilized to test the hypotheses of the study. Also, 150 questionnaires were distributed to a sample consisted of 26 companies and (108 questionnaires) 72% of these questionnaires were returned. The data was analyzed using [Cronbach's Alpha test, Descriptive Statistics, and One Sample T Test,]. The main findings of this paper are the following (1) The auditing committee is not available in the Palestinian public shareholding companies. Also, there is shortcoming in the process of appointing an external auditor. (2) The following committees are not available in the Palestinian public shareholding companies (audit committee, corporate governance committee, incentives and rewards committee, and corporate strategy committee). (3) There are deficiencies in the availability of shareholders committee constituents that meet the requirements of corporate governance model. (4) There are deficiencies in the availability of board of directors constituents that meet the requirements of corporate governance model. Accordingly, the study recommends the management and the decision makers in Palestine Exchange to formulate regulations compelling the Palestinian public shareholding companies to apply corporate governance model.