Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB) An Online International Monthly Journal (ISSN: 2306-367X) 2014 Vol: 3 Issue 1 976 www.globalbizresearch.com Equity Ownership, Audit Quality and Firm Performance in Malaysia using Generalized Least Square Estimations Technique Mohd Abdullah Jusoh, Fakulti Pengurusan dan Ekonomi, Universiti Pendidikan Sultan Idris, Tanjong Malim, Perak, Malaysia. Email: mohd.abdullah@fpe.upsi.edu.my Ayoib Che Ahmad, College of Business, Universiti Utara Malaysia, Kedah, Malaysia. Email: ayoib@uum.edu.my ___________________________________________________________________________ Abstract The separation of ownership and management functions in modern corporations and the presence of ‘information asymmetry’ result in principal-agent conflict. This study investigates the relationship between ownership structure and company performance of publicly listed companies in Malaysia. The ownership is divided into two categories; managerial ownership and institutional ownership. Further, this study investigates the effect of audit quality on company performance. Panel data of 730 Malaysian public listed companies were examined. Normality check of the data was also carried out and some of the measures were transformed into logarithmic data to control the skewed nature of data. As multivariate regression is used to analyze the data in this study, assumptions of multicollinearity, hemoscedasticity and linearity are also tested. Furthermore, this study applied the F-test, Chow test and Hausman test to determine the best statistical method. The analysis utilizing GLS fix effects estimations technique is applied. The results showed that managerial ownership had negative and significant relationship with ROA and Tobin’s Q. In contrast, institutional ownership showed positive and significant relationship with ROA and Tobin’s Q. Further, audit quality affects positively to both of performance indicators. The involvement of institutional investors in monitoring and controlling activities and high quality auditing have the potential to reduce agency cost and as a result, the company performance increased. ___________________________________________________________________________ Keywords: Corporate ownership, Audit quality, Performance, Malaysia