The audit status of preliminary profit announcements

Abstract

The regulations concerning preliminary profit announcements are contained in the Listing Rules of the Stock Exchange. The disclosure provisions are modest and there is no requirement for the document to be audited. There have been criticisms concerning the ambiguity of the auditors’ involvement and the timing of the release of information for a number of years. Amendments introduced in 1993 have done little to resolve the matter. As an empirical study of 148 randomly selected listed companies, seeks answers to the following three questions: Does the audit status have any relationship with the size or type of company? Is the audit status associated with the timing of the release of information? Is the audit status associated with the voluntary provision of additional financial statements? Concludes that there is considerable variety in company practice and that the Stock Exchange should take action to dispel the ambiguities concerning auditors’ involvement with preliminary profit announcements.

Citation

Beasley, T., Hapeshi, K. and Hussey, R. (1997), "The audit status of preliminary profit announcements", Managerial Auditing Journal, Vol. 12 No. 3, pp. 135-141. https://doi.org/10.1108/02686909710161004