An Empirical Analysis of Audit Delays and Timeliness of Corporate Financial Reporting in Kuwait
Tóm tắt
This paper analyzes the factors that affect delays in the signing of audit reports. Audit delays are measured by the number of days that elapse from the end of the financial year until the date when the auditor report is signed. Previous studies of audit delays in various countries are reviewed, along with some of the results of the variables that were tested. This study focuses on 149 and 177 companies listed on the Kuwait stock market in 2006 and 2007, respectively. Six explanatory variables are tested to investigate delays in issuing audit reports. The results show that company size is the only variable that negatively correlates with audit delay in the period tested. The variables industry classification, leverage, percentage change in earning per share, type of auditors, and liquidity show no significant correlation with audit delays for listed companies in Kuwait. Liquidity, leverage, and type of auditors are negatively correlated with audit delay in 2006 for the first two variables and in 2007 for the type of auditors. Future research would consider other variables such as other interpretation of company size, ownership concentration, quality of internal control, direction of income or loss, and the mix of audit work
Tài liệu tham khảo
Ahmad, R. and Kamarudin, K., 2003. Audit delay and the timeliness of corporate reporting: Malaysian evidence. In: Communication Hawaii International Conference on Business, Hawaii, USA 18–21 June 2003.
Al-Ajmi, J., 2008. Audit and reporting delays: Evidence from an emerging market. Advances in Accounting, 24(2), pp.217–226.
A-Hajeri, K., 1992. Standardization of accounting practices in the developing countries: the case of Kuwait. Ph.D. City University.
Al-Harshani, M.O., 2008. The pricing of Audit services: Evidence from Kuwait. Managerial Auditing Journal, 23(7), pp.685–696.
Al-Shammari, B., Al-Yaqout, A., and Al-Hussaini, A. (in press) Determinants of audit fees in Kuwait. Journal of the Academy of Business and Economics. (Accepted for publication January 2008).
Al-Shammari, B. Brown, P. and Tarca, A., 2007. Development of enforcement mechanism following adoption of International Accounting Standards in the Gulf Cooperation Council member states. [online] Available at: <http://ssrn.com/auther=106179> [Accessed 20 June 2010].
Ashton, R.H. Willingham, J.J. and Elliott, R.K., 1987. An empirical analysis of audit delay. Journal of Accounting Research, 25(2), pp.275–292.
Ashton, R.H. Graul, P.R. and Newton, J.D., 1989. Audit delay and the timeliness of corporate reporting. Contemporary Accounting Research, 5(2), pp.657–673.
Bonson-Ponte, E., Escobar-Rodriguez, T., and Borrero-Dominguez, C., 2008. Empirical analysis of delays in the signing of audit reports in Spain. International Journal of Auditing, 12(2), pp.129–140.
Boonlert-U-Thai, K. Patz, D.H. and Saudagaran, S.M., 2002. An examination of timeliness of corporate financial reporting: Empirical evidence from the Stock Exchange of Thailand. In: American Accounting Association, Annual Meeting. San Antonio, USA 14–17 August 2002.
Carcello, J. Hermanson, R. and McGrath, N., 1992. Audit quality attributes: the perceptions of audit partners, preparers, and financial statements users. Auditing: A Journal of Practice and Theory, 11(1), pp.1–23.
Carslaw, A.P.N. and Kaplan, S.E., 1991. An examination of audit delay: Further evidence from New Zealand. Accounting and Business Research, 22(85), pp.21–32.
Chambers, A.E. and Penman, S.H., 1984. Timeliness of reporting and the stock price reaction to earnings announcements. Journal of Accounting Research, 22(1), pp.21–47.
Conover, C.M. Miller, R.E. and Szakmary, A., 2008. The timeliness of accounting disclosures in international security markets. International Review of Financial Analysis, 17(5), pp.849–869.
Courtis, J.K., 1976. Relationships between timeliness in corporate reporting and corporate attributes. Accounting and Business Research, 6(25), pp.45–56.
Davis, B. and Whittred, G.P., 1980. The association between selected corporate attributes and timeliness in corporate reporting: Further analysis. Abacus, 16(1), pp.48–60.
DeAngelo, L., 1981. Auditor size and audit quality. Journal of Accounting and Economics, 3(3), pp.183–199.
Garsombke, H. P., 1981. The timeliness of corporate financial disclosure. in J.K. Courtis, ed., Communication via Annual Reports, AFM Exploratory Series No.11 Armidale, N.S.W: University of New England, pp.204–218.
Gilling, D.M., 1977. The timeliness in corporate reporting: some further comment. Accounting and Business Research, Winter, pp.34–36.
Givoly, D. and Palmon, D., 1982. Timeliness of annual earnings announcements: Some Empirical evidence. Accounting Review, 57(3), pp.486–508.
Hossain, M.A. and Taylor, P.J., 1998. An examination of audit delay: Evidence from Pakistan. [online] Available at: <http://www.mahossain.com/pdf/audpf.pdf> [Accessed 11 September 2010].
Imam, S. Ahmed, Z.U. and Khan, S.H., 2001. Association of audit delay and audit firms’ international links: Evidence from Bangladesh. Managerial Auditing Journal, 16(3), pp.129–134.
Jaggi, B. and Tsui, J., 1999. Determinants of audit lag: Further evidence from Hong Kong. Accounting and Business Research, 30(1), pp.17–28.
Knechel, R. and Payne, J., 2001. Additional evidence on audit report lag. Auditing: A Journal of Practice and Theory, 20(1), pp.137–46.
Kross, W. and Schroeder, D.A., 1984. An empirical investigation of the effect of quarterly earnings announcement timing on stock returns. Journal of Accounting Research, 22(1), pp.153–176.
Lambert, T.A. Jones, K.L. and Brazel, J.F., 2010. Unintended consequences of accelerated filings: Are mandatory reductions in audit delay associated with reductions in earnings quality. [online] Available at: <http://papers.ssrn.com/sol3/papers.cfm?abstract_id=963402> [Accessed 11 September 2010].
Leventis, S. Weetman, P. and Caramanis, C., 2005. Determinants of audit report lag: Some evidence from the Athens Stock Exchange. International Journal of Auditing, 9(1), pp.45–58.
Malallah, B., 1984. The developing of accounting and financial reporting practices in developing country: Kuwait. Ph. D. Cardiff University.
Naser, K. and Nuseibeh, R., 2007. Determinants of audit fees: empirical evidence from an emerging economy. International Journal of Commerce and Management, 17(3), pp.239–254.
Ng, P.P.H. and Tai, B.Y.K., 1994. An empirical examination of the determinants of audit delay in Hong Kong. British Accounting Review, 26(1), pp.43–59.
Owusu-Ansah, S., 2000. Timeliness of corporate financial reporting in emerging capital markets: Empirical evidence from the Zimbabwe Stock Exchange. Accounting and Business Research, 30(3), pp.241–254.
Simnett, R. Aitken, M. and Choo, F., 1995. The determinants of audit delay. Advances in Accounting, 13, pp.1–20.
Wang, J. and Song, L., 2006. Timeliness of annual reports of Chinese listed companies. Journal of Chinese Economic and Business Studies, 4(3), pp.241–257.