Timeliness of Annual Audit Report: Some Empirical Evidence from Malaysia

SSRN Electronic Journal 12/2011; DOI: 10.2139/ssrn.1967284

ABSTRACT The aim of this study is to examine the factors that influence annual audit report in Malaysia. The sample includes 300 largest companies listed in the KLSE for the year ended 2009. Findings show that audit report lag is significantly influenced by auditor type, audit opinion and firm performance. However, no evidence was found to support the effect of board independence, audit committee size, audit committee meetings and audit committee qualifications on audit report lag. Apart from contributing to the literature on determinants of audit timeliness, this study also falls under the strand of literature that examines the consequences of the regulatory changes introduced around the world to strengthen corporate governance and financial reporting transparency, hence provide evidences of recent audit delays.

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    ABSTRACT: This paper reviews the literature on audit committees in order to evaluate the extent to which committees are effective in terms of strengthening financial reporting. The paper aims to achieve two goals: first. to provide updated information about the effectiveness of the audit committee, and second to identify research opportunities. Compared with other reviews on the matter, we cover a broader spectrum of theoretical perspectives from various fields, methods, and countries. In particular, our review investigates from a meta-perspective the results reported in studies which examine the relationship between certain audit committee characteristics and measures of audit committee effectiveness. It is hoped that this work will sensitize accounting researchers about the appropriateness of extending the boundaries of research on audit committees, from methodological, theoretical, and geographical points of view.
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    ABSTRACT: This paper investigates the determinants of audit delay in Malaysia. The sample comprises 100 companies listed in Kuala Lumpur Stock Exchange during the period 1996-2000. Descriptive statistics indicates the audit delay is more 100 days for the five years under study with a minimum standard deviation of 36 days. Eight hypotheses, relating audit delay to company size, industry classification, sign of income, extraordinary item, audit opinion, auditor, year-end and risk are tested in this study. Result from t-test of differences, chi-square test of independent and ordinary leas square regression (OLS) largely support the alternate hypotheses put forward except for extraordinary items and company size. The primary findings are that audit delay is significantly longer for company that (1) non-financial industry, (2) receive other that unqualified audit opinions, (3) have other than 31 December as financial year end, (4) audited by non big- five, (5) incurred negative earnings and (6) have higher risk. It is hoped that this study, which is conducted in an economically and culturally different context from all existing studies, can contribute toward the current literature on audit delay.
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    ABSTRACT: Purpose – There are three main purposes of this study which are: first, to review the literature on audit report lag (ARL) and its determinants; second, to measure the extent of ARL in a developing country, Egypt; and third, to empirically examine the impact of corporate governance (CG) characteristics on ARL in Egypt. Design/methodology/approach – The literature on determinants of ARL motivated the author to investigate about the impact of CG characteristics and audit-related characteristics on ARL especially in emerging capital markets, such as the Cairo and Alexandria Stock Exchange (CASE) for a sample (85 companies) of Egyptian listed companies. Further, the study includes explanatory variables relating to CG characteristics, which have not previously been considered (i.e. board independence, duality of chief executive officer (CEO), and existence of an audit committee), that may shed more light on the structure and dynamics of the ARL. Findings – The ARL for each of the 85 listed sample companies ranged from a minimum interval of 19 days to a maximum interval of 115, and Egyptian listed companies take approximately two months on average. A regression analysis indicates that board independence, duality of CEO, and existence of an audit committee significantly affect ARL. But on the other hand, ownership concentration has insignificant affect on ARL. Also, three control variables (company size, industry and profitability) significantly affected ARL. The adjusted R2 indicate that 57.10 per cent of the variation in the dependent variable in the regression model is explained by variations in the independent variables. Originality/value – This study of Egyptian companies listed on the CASE represents the initial comprehensive examination of ARL, and it is consider the first study to provide a thorough examination of the association between CG characteristics and ARL.
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