Indirect effects of regulatory change: Evidence from the acceleration of the 10-K filing deadline

IF 1.2 Q3 BUSINESS, FINANCE
Bei Dong , Jonathan Nash , Le Xu (Emily)
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引用次数: 1

Abstract

This study examines the indirect effects of regulatory change by studying the audit office effects of changes in client time pressure caused by the first acceleration of the 10-K filing deadline. The extant literature provides evidence that increased client time pressure adversely affects the timing and quality of individual engagements. We argue that because audit offices possess finite resources and production capacity in the short run, client-level pressure can have office-level effects. We document within-office differences related to changes in audit timeliness. In the same audit office, clients with no pressure (with pressure) experience an increase (a decrease) in audit report lag post-acceleration. This evidence suggests that auditors alter the timing of concurrent engagements in response to client pressure, and clients of the same office are affected differently by changes in time pressure. We also document across-office differences in audit/filing timeliness and audit quality. Clients of audit offices with more time pressure across the entire client portfolio experience a greater negative impact on audit timeliness, are more likely to file late, and experience lower audit quality. Taken as a whole, our results are consistent with client time pressure producing office effects as a result of the auditors' response to increased resource constraints. Further, we show that the time pressure documented during the first acceleration is transitory in nature. These results should be informative to regulators and practitioners because they suggest there are indirect costs associated with regulatory compliance, and such costs are not limited to directly affected clients.

监管变化的间接影响:来自10-K申报截止日期加速的证据
本研究考察了监管变化的间接影响,通过研究审计办公室对客户时间压力变化的影响,这是由10-K提交截止日期的第一次加速引起的。现有文献提供的证据表明,客户时间压力的增加对个别业务的时间和质量产生不利影响。我们认为,由于审计机构在短期内拥有有限的资源和生产能力,客户层面的压力可以产生办公室层面的影响。我们记录了与审计及时性变化相关的办公室内部差异。在同一审计办公室,无压力(有压力)的客户在加速后审计报告滞后增加(减少)。这一证据表明,审计师会根据客户的压力改变并行业务的时间,同一事务所的客户受到时间压力变化的不同影响。我们还记录了跨部门在审计/归档及时性和审计质量方面的差异。在整个客户组合中,时间压力更大的审计办公室的客户对审计及时性的负面影响更大,更有可能延迟提交,并且审计质量更低。整体而言,我们的结果与客户时间压力产生的办公室效应是一致的,这是审计人员对资源限制增加的反应。此外,我们表明,在第一次加速期间记录的时间压力本质上是短暂的。这些结果应该对监管机构和从业人员提供信息,因为它们表明与监管合规相关的间接成本,而且这些成本不仅限于直接受影响的客户。
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
Advances in Accounting
Advances in Accounting BUSINESS, FINANCE-
CiteScore
2.50
自引率
6.20%
发文量
29
期刊介绍: Advances in Accounting, incorporating Advances in International Accounting continues to provide an important international forum for discourse among and between academic and practicing accountants on the issues of significance. Emphasis continues to be placed on original commentary, critical analysis and creative research.
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