More evidence that board make-up matters. In this peice, Qin finds that, having an
"..accounting-literate professional as SEC initially proposed serving on the audit committee are more likely to have high quality of reported earnings than others without such an expert.Interestingly the final definition of financial expert that was adopted by the SEC yielded a MUCH weaker finding so it appears that not only board make-up matters, but also definitions!
Qin, Bo, "The Influence of Audit Committee Financial Expertise on Earnings Quality: US Evidence" (March 2006). Available at SSRN: http://ssrn.com/abstract=799645