The consideration of financial accounting and internal control issues by boards of trustees of voluntary short-term general hospitals : an empirical investigation

Author

Thomas Alan Gavin

Date of Award

3-1982

Degree Type

Dissertation

Major

Business Administration

Major Professor

Jan R. Williams

Committee Members

Keith Stanga, Alan Lasater, Jim Scheiner

Abstract

This doctoral dissertation is a research effort directed at determining the manner and extent that boards of trustees of voluntary short-term general hospitals address financial accounting and internal control (FA/IC) issues. Organizationally, FA/IC issues can be pursued by either the full board or some type of committee structure. Committee structures include a single committee, joint committee, or multiple committees. Besides comparing hospital board structures to primarily determine where differences exist as to what FA/IC purposes are identified and what FA/IC functions are pursued, this research also compared all hospital board FA/IC committees with data gathered on corporate audit committees by Robert K. Mautz and Frederick L. Neumann and presented in their study entitled Corporate Audit Committees; Policies and Practices.

The literature review provides a foundation on which the research is built. Some of the more important findings within the literature are:

1. In the past, governing boards have been portrayed as not living up to their responsibilities.

2. Management retains power because they control the flow and shape of information given to the board, as well as the kinds of matters they will discuss.

3. A committee structure of the board permits an intensive treatment of a subject that the full board would only briefly have time to consider because of its many time constraints.

The results of the analysis reveal that substantial differences exist between corporations and hospitals concerning the way boards address FA/IC issues. In the corporate setting, respondents viewed as important the committee's personal contact with the external auditor; the committees most frequently pursue and view as most important those functions related to the independent auditor. Respondents from hospitals, on the other hand, view contact with the hospital financial officer as important; hospital FA/IC committee functions are dispersed across a wide range of functions that appear to be indicative of the industry's environment.

Hospital FA/IC committees identified more FA/IC purposes and functions, particularly related to the independent auditor, than did full boards. All hospital board structures viewed among the most important and effectively pursued functions reviewing budgets and discussing the meaning and significance of the audited financial statements.

Recommended Citation

Gavin, Thomas Alan, "The consideration of financial accounting and internal control issues by boards of trustees of voluntary short-term general hospitals : an empirical investigation. " PhD diss., University of Tennessee, 1982.
https://trace.tennessee.edu/utk_graddiss/13239