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Article
Publication date: 25 January 2021

Hela Gontara and Hichem Khlif

The purpose of this paper is to examine the association between audit report lag (ARL) and tax avoidance and test whether external auditor type affects this relationship.

Abstract

Purpose

The purpose of this paper is to examine the association between audit report lag (ARL) and tax avoidance and test whether external auditor type affects this relationship.

Design/methodology/approach

ARL is measured as the number of days from fiscal year-end to the date of the auditor’s report, while tax avoidance is measured using effective tax rate.

Findings

Using a sample of 45 South African companies over the period of 2010–2013, the authors document that ARL is positively associated with tax avoidance and this relationship remains positive when the company is audited by a Big-4 audit firm and not significant when the company is audited by a non-Big-4.

Originality/value

The authors’ findings have important implications for auditors aiming to reduce audit risk as they may consider the impact of tax avoidance and pay more attention to companies with a high degree of tax avoidance.

Details

Journal of Financial Crime, vol. 28 no. 3
Type: Research Article
ISSN: 1359-0790

Keywords

Article
Publication date: 11 February 2022

Hela Gontara, Imen Khelil and Hichem Khlif

The purpose of the paper is to examine the association between internal control quality (ICQ) and audit report lag (ARL) and to test whether family directors affect the…

Abstract

Purpose

The purpose of the paper is to examine the association between internal control quality (ICQ) and audit report lag (ARL) and to test whether family directors affect the relationship.

Design/methodology/approach

ICQ is measured by using the framework developed by Michelon et al. (2015), while ARL is measured as the number of days from fiscal year-end to the date of the auditor's report.

Findings

Using a sample of 190 French companies over the period of 2016–2019, the authors document that ICQ is negatively associated with ARL, suggesting that ICQ represents a key determinant of audit delay. When testing for the moderating effect of family directors on this relationship, findings show that under high percentage of family directors on the board, this relationship becomes insignificant.

Originality/value

This paper extends previous research on audit delays by investigating the moderating effect of family directors on the relation between ICQ and ARL in the French setting. The empirical evidence highlights the adverse effect of the concentration of family directors on the board on timely disclosure as proxied by ARL.

Details

Journal of Family Business Management, vol. 13 no. 2
Type: Research Article
ISSN: 2043-6238

Keywords

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