Do covenant violations affect audit report timeliness

Q4 Economics, Econometrics and Finance

International Journal of Accounting, Auditing and Performance Evaluation Pub Date : 2018-01-24 DOI:10.1504/IJAAPE.2018.10010453

Zane L. Swanson, Yinghong Zhang

引用次数: 9

Abstract

We investigate the impact of covenant violations on audit report timeliness. We argue that the existence of covenant violations might motivate clients or banks to seek waivers or renegotiations of current lending contracts. Otherwise, auditors might perform more audit tests before issuing audit opinions. Ultimately, auditors will increase the number of days to complete the audit. Our major findings are consistent with our prediction. In addition, we find that the presence of early covenant violations further increases audit delays. Our findings identify another factor affecting the audit report timeliness and one economic consequence of covenant violations.

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违反约定会影响审计报告的及时性吗

我们调查了违反约定对审计报告及时性的影响。我们认为，违反契约的存在可能会促使客户或银行寻求豁免或重新谈判当前的贷款合同。否则，审计师可能会在发表审计意见之前进行更多的审计测试。最终，审计人员将增加完成审计的天数。我们的主要发现与我们的预测一致。此外，我们发现，早期违反契约的行为进一步增加了审计延迟。我们的调查结果确定了影响审计报告及时性的另一个因素和违反契约的一个经济后果。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

International Journal of Accounting, Auditing and Performance Evaluation Economics, Econometrics and Finance-Finance

CiteScore

0.70

自引率

0.00%

发文量

期刊介绍： IJAAPE publishes original scholarly papers across the whole spectrum of: financial accounting, managerial accounting, accounting education, auditing, taxation, public sector accounting, capital market and accounting, accounting information systems, performance evaluation, corporate governance, ethics, and financial management. All methodologies, such as analytical, empirical, behavioural, surveys, and case studies are welcome. IJAAPE encourages contributions especially from emerging markets and economies in transition and studies whose results are applicable across nation states or capable of being adapted to the different accounting and business environments.