Timeliness of financial reporting and audit committee effectiveness: evidence from UAE

Abstract

ABSTRACT
 Purpose – This study aims to examine the contemporary timeliness of financial reporting in the United Arab Emirates (UAE), and the impact of audit committee effectiveness on this timeliness.
 Design/Methodology/Approach – Timeliness of financial reporting in this study is measured by audit report lag (ARL), which is the number of days between the date of the financial year end and the date of the audit report. The data from listed companies on the UAE capital markets; Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM), for three years from 2011 to 2013 resulted in 298 observations. The main statistical techniques of the study are means and multiple regressions.
 Findings – The findings show that generally all companies meet the submission deadlines imposed by the two UAE markets. Furthermore, ARL is influenced by audit committee size and profitability, while no evidence is found to support the effect of audit committee expertise, audit committee meetings and firm size on ARL.
 Practical Implications – The results of the study show that only audit committee size has a significant influence in reducing ARL. This may be attributed to having minimal variation in the implementation of the Code of Corporate Governance (CCG), particularly audit committee attributes, in the UAE. The results suggest that the current governance by audit committees is adequate to ensure that the financial reports of companies in the UAE are timely. However, except for audit committee size, the other audit committee attributes are unable to further shorten ARL.
 
 Originality/Value –The capital markets in the UAE and its CCG are relatively new. Hence, regulatory requirements may be less stringently implemented by companies in this country. Consequently, timely audited financial reports are demanded by local and international investors to make decisions and alleviate speculation. Thus, determining audit committee attributes that reduce ARL is beneficial to the UAE markets, the listed companies and investors. 
 
 Keywords Audit report lag (ARL), Financial reporting timeliness, Audit committee, UAE
 Paper Type: Research paper

دراسة واختبار العلاقة بین القدرة الإداریة وفترة تأخیر تقریر مراقب الحسابات- دلیل من الشرکات غیر المالیة المقیدة بالبورصة المصریة

“…‫اجعة‬ ‫الرا‬ ‫ا‬ ‫دا‬ ‫ليى‬ ‫الحباعا‬ ‫اقا‬ ‫ما‬ ‫لةةع‬ ‫خ‬ ‫ار‬ ‫إلى‬ ‫الرالةة‬ (Diana,2018;Viet et al,2018;Abdillah et al,2019;Shofiyah & Suryani,2020;Yuliusman et al,2020 (Al-Ajmi,2008;Afify,2009 ;Abernathy et al,2014;Sultana et al,2015;Ghafran & Yasmin,2018;Oussii & Taktak,2018;Viet et al,2018;Shofiyah & Suryani,2020;Yuliusman et al,2020;Firnanti & Karmudiandri, (Samaha & Khlif,2017;Diana,2018;Raweh et al,2019;Hasballah & IIyas,2019;Aljaaidi et al, Afify,2009;Samaha & Khlif,2017;Ghafran & Yasmin,2018;Viet et al,2018;Yuliusman et al,2020;Pradipta & Zalukhu, (Al-Ajmi,2008;Afify,2009 ;Abernathy et al,2014;Almuzaiqer et al,2018;Oussii & Taktak,2018;Viet,2018;Badawy & Aly,2018;Abdillah et al,2019;Raweh et al,2019;Hasballah & IIyas,2019;Shofiyah & Suryani,2020;Yuliusman et al, (Ika & Ghazali,2012;Abernathy et al,2014;Sultana et al,2015;Diana,2018;Raweh et al,2019;Hasballah & IIyas,2019…”

Effect of Accounting Information Systems, Teamwork, and Internal Control on Financial Reporting Timeliness

“…They work together to achieve company goals following the organization's vision and mission (Cha, 2015;Yoon & Kayes, 2016). Almuzaiqer (2018); Costa et al (2014) explain that teamwork can affect the timeliness of financial statements because its preparation and submission can be completed on time. Therefore, the financial statements still have the moment in time used as a decision-making tool (Solansky et al, 2017).…”

“…In addition, internal control aims to safeguard the property from a variety of fraud and theft attempts and use of assets in the wrong place (Donnell, 2019). Its activities in the cooperative business provide reasonable guarantees and make timely financial reporting (Almuzaiqer, 2018;Johnston & Zhang, 2018), encourage the efficiency and effectiveness of entity's operation and promote adherence to management policies (Al-Sharairi et al, 2018;Lu et al, 2019;Noble, 2019). Poor internal control results in inaccurate and late reporting.…”

“…Poor internal control results in inaccurate and late reporting. Conversely, effective control produces financial reports that are timely and provides opportunities for companies to fully operate (Almuzaiqer, 2018;Ayamga & Bagina, 2019;Donnell, 2019;Noble, 2019;Turtle & Wang, 2017).…”

تأثیـر الخصائص التشغیلیة للشرکة وخصائص مکتـــــب المــــراجعة على علاقـــة فعـــالیة لجنـــــة المراجعة بفترة إصدار تقریر المراجعة :دراسة تطبیقیة على الشرکات المسجلة بالبورصة المصریة

“…‫ةر‬ ‫ة‬ ‫ي‬ ‫تقر‬ ‫ةدار‬ ‫إص‬ ‫ةر‬ ‫ة‬ ‫فت‬ ‫ة‬ ‫ةل‬ ‫ةل‬ ‫دد‬ ‫ةة‬ ‫ة‬ ‫انع‬ ‫الار‬ ‫ةة‬ ‫لنة‬ ‫ةة‬ ‫فعالي‬ ‫ةأثير‬ ‫ة‬ ‫ت‬ ‫ة‬ ‫ةل‬ ‫ةر‬ ‫اتل‬ ‫ةبعض‬ ‫ة‬ ‫ال‬ ‫ةز‬ ‫رد‬ ‫ةا‬ ‫خيةا‬ ‫ةة،‬ ‫انع‬ ‫الار‬ ‫ةة‬ ‫لنة‬ ‫ةة‬ ‫لتعالي‬ ‫ةر‬ ‫ايي‬ ‫إةداد‬ ‫لعل‬ ‫ان‬ ‫انعة‬ ‫الار‬ (Ika and Ghazali ,2012 ;Aljaaidi et al, 2019 ;Hasballah and Ilyas,2019 ;Abdillah et al ,2019 ;Juwita et al ,2020 (Diana,2018;Badawy and Aly,2018;Almuzaiqer et al, 2018;Chukwu and Nwabochi, 2019Aljaaidi et al, 2019Abdillah et al, 2019Shofiyah and Suryani, 2020 ;Yuliusman et al, 2020) ‫ةل‬ ‫بادت‬ ‫ةة‬ ‫تبط‬ ‫الار‬ ‫اا‬ ‫ةر‬ ‫الاتغي‬ ‫ة‬ ‫ةل‬ ‫ةزا‬ ‫رد‬ ‫ةد‬ ‫ا‬ ‫ةرل‬ ‫أل‬ ‫ةاا‬ ‫اس‬ ‫در‬ ‫ةاك‬ ‫لهة‬ ‫انعة‬ ‫الار‬ (Badawy and Aly, 2018;Abdillah et al , 2019 ;Juwita et al, 2020;Pradipta and Zalukhu, 2020 (Diana,2018;Viet et al 2018 Raweh;Chukwu and Nwabochi 2019;Abdillah et al Suryani, 2020 ;Yuliusman et al, 2020) Leventis, 2006;Al-Ajmi,2008 ;Afify,2009 ;Samaha and Khlif ,2017;Ghafran and Yasmin, 2018;Viet et al, 2018;Yuliusman et al , (Al-Ajmi,2008 ;Afify, 2009;Abernathy et al, 2014;Oussii and Taktak ,2018;Viet et al, 2018;Badawy and Aly, 2018;Almuzaiqer et al ,2018;Abdillah et al ,2019Raweh et al , 2019Hasballah and Ilyas, 2019;…”