Determinants of Audit Report Lag and Corporate Governance in Malaysia

Abstract

Inevitably, an accurate and timely financial statement contributes enormously to the success of many organizations. Therefore, accuracy and availability about financial information is vital for investors and shareholders in order to ease their decision making process. This paper aims to analyze the relation between the characteristics of corporate governance; board independence, ownership concentration, audit committee independence, expertise, meeting, size, internal audit investment and audit report lag among companies listed under Bursa Malaysia. The samples covered are among 180 companies listed at Bursa Malaysia for 2009 and 2010. The samples were chosen randomly from 843 companies, the population. Descriptive statistics have been used to provide better perception of the length of time needed by an auditor, to complete an audit. The results show that in average, the companies took about 100 days to complete their audit report with maximum and minimum days of 148 days and 26 days respectively. In addition, regression analysis was used to provide empirical evidence on which variables had strong bonding with audit report lag. The outcomes elicit that audit committee size, ownership concentration; organization size and profitability are significantly associated with audit report lag. However the other six variables (audit committee independence, meetings, expertise and types of auditors) were found to have insignificant relationship with audit report lag. [ABSTRACT FROM AUTHOR] Copyright of International Journal of Business & Management is the property of Canadian Center of Science & Education and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)