Audit report lag during the COVID-19 pandemic: A multi-country analysis

Adeeb Alhebri (), Radwan Alkebsee (), Ebrahim Mohammd Al-Matari (), Jamel Azibi () and Adam Mohamed Omer ()

Humanities and Social Sciences Letters, 2024, vol. 12, issue 3, 443-460

Abstract: This research investigates the impact of the COVID-19 pandemic on the promptness of audit reports. The COVID-19 epidemic has had a significant impact on several sectors, including accounting and auditing. The present study employed a dataset of 6652 multinational firms sourced from the Refinitiv Eikon and Datastream databases. We chose the year 2018 as the first reference point because there was no worldwide pandemic during that period. The global outbreak, which emerged in Wuhan, China, in December 2019, rapidly disseminated to many nations by March 2020. The regression analysis of a sample of 6652 worldwide enterprises indicates a positive correlation between the COVID-19 epidemic and the delay in issuing audit reports. This observation implies that the occurrence of such crises exacerbates the promptness of audit reports. Our study’s findings indicate that governments’ implementation of travel restrictions has a negative impact on the promptness of audit reports. Therefore, our results demonstrate resilience to endogeneity. Our findings add to the body of knowledge; this is the first study to look at how the COVID-19 epidemic has affected audit report latency globally. Second, while the promptness of audit reports is crucial for regulators and investors in a stable environment, it becomes even more crucial under unforeseen circumstances like the COVID-19 epidemic. Finally, the results of this study hold significant relevance for regulatory bodies and investors alike.

Keywords: Audit quality; Audit report lag; COVID-19; Lockdown; Timeliness. (search for similar items in EconPapers)
Date: 2024
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