Audit Delay

In: Business and Management

Submitted By verysony
Words 5090
Pages 21
AUDIT DELAY AND THE TIMELINESS OF
CORPORATE REPORTING: MALAYSIAN EVIDENCE
Raja Adzrin Raja Ahmad
Khairul Anuar Bin Kamarudin

Second Draft: August 2003
Please do not quotes - comments welcome

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 bigfive, (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.

Correspondence Address:
Raja Adzrin Raja Ahmad
Faculty of Accountancy
MARA University of Technology
Locked Bag 527,
85009 Segamat, JOHOR, MALAYSIA e-mail: azrina10275@yahoo.com

1

Introduction
Timeliness is an important qualitative attribute of financial statement, which requires the information to be made available to the users as rapidly as possible.
The increase in the reporting lag reduces the information content and relevancy of the documents. The…...

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