The analysis of factors affecting audit report lag: A literature review

Abstract

Financial statements are critical for evaluating a company's condition, influencing stakeholder decisions. Timely financial reporting enhances information effectiveness for investors. Audit report lag, the delay in the audit process, poses a significant challenge to timely reporting. This study explores the impact of audit committee characteristics, CEO traits, and financial distress on audit report lag through a literature review. Audit committees, particularly when independent and possessing accounting expertise, can expedite audits, ensuring effective oversight. CEO characteristics, including accounting expertise and gender, play a role in timely audit completion. A financial distress situation further complicates the audit process, extending the lag in reporting. Understanding these dynamics is crucial for improving financial transparency, efficiency, and reliability, benefiting decision-makers and stakeholder trust. The research contributes to a deeper comprehension of factors influencing audit delays, reinforcing literature on this subject.