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The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia

The purpose of this study is to examine the extent of audit report lag (ARL) and its association with governance mechanisms in the Islamic banking institutions in Malaysia. The extent of ARL lag is defined by the number of days from a company’s financial year-end to the signature date on its audit r...

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Main Authors: Kaaroud, Mohamed Ahmed, Mohd. Ariffin, Noraini, Ahmad, Maslina
Format: Article
Language:English
English
English
Published: Emerald Group Publishing 2020
Subjects:
HF5735 Business records management
HG1501 Banking
HG3368 Islamic Banking and Finance
Online Access:http://irep.iium.edu.my/80466/1/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance.pdf
http://irep.iium.edu.my/80466/2/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_SCOPUS.pdf
http://irep.iium.edu.my/80466/3/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_WOS.pdf
http://irep.iium.edu.my/80466/
https://www.emerald.com/insight/content/doi/10.1108/JIABR-05-2017-0069/full/html
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spelling my.iium.irep.804662020-05-22T02:06:21Z http://irep.iium.edu.my/80466/ The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia Kaaroud, Mohamed Ahmed Mohd. Ariffin, Noraini Ahmad, Maslina HF5735 Business records management HG1501 Banking HG3368 Islamic Banking and Finance The purpose of this study is to examine the extent of audit report lag (ARL) and its association with governance mechanisms in the Islamic banking institutions in Malaysia. The extent of ARL lag is defined by the number of days from a company’s financial year-end to the signature date on its audit report. The sample of the study comprises 112 observations of Islamic banking institutions’ financial reports for the period 2008-2014. A balanced panel data analysis is performed to analyse the association between the extent of ARL and governance mechanisms. The findings show that the extent of ARL for the sample selected ranges from a minimum period of 7 days to a maximum period of 161 days which approximately two months on average. A fixed effects analysis indicates that audit committee expertise and audit committee meeting have significant association with the extent of ARL. On the other hand, board independence, audit committee size and Shari’ah board expertise have insignificant association with the extent of ARL. In addition, one control variable (Islamic bank size) is found to be significantly associated with longer ARL. The findings provide useful feedback for Malaysian policymakers on the past and current practices of financial reports and of governance mechanisms. The findings of the study would help the policymakers in monitoring the Islamic banking institutions’ compliance with financial reports submission requirements. The policymakers perhaps could relook into governance mechanisms that could reduce the extent of ARL in the Islamic banking institutions and implement regulations to strengthen them. Emerald Group Publishing 2020-01-06 Article PeerReviewed application/pdf en http://irep.iium.edu.my/80466/1/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance.pdf application/pdf en http://irep.iium.edu.my/80466/2/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_SCOPUS.pdf application/pdf en http://irep.iium.edu.my/80466/3/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_WOS.pdf Kaaroud, Mohamed Ahmed and Mohd. Ariffin, Noraini and Ahmad, Maslina (2020) The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia. Journal of Islamic Accounting and Business Research, 11 (1). pp. 70-89. ISSN 1759-0817 E-ISSN 1759-0825 https://www.emerald.com/insight/content/doi/10.1108/JIABR-05-2017-0069/full/html 10.1108/JIABR-05-2017-0069
institution Universiti Islam Antarabangsa Malaysia
building IIUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider International Islamic University Malaysia
content_source IIUM Repository (IREP)
url_provider http://irep.iium.edu.my/
language English
English
English
topic HF5735 Business records management
HG1501 Banking
HG3368 Islamic Banking and Finance
spellingShingle HF5735 Business records management
HG1501 Banking
HG3368 Islamic Banking and Finance
Kaaroud, Mohamed Ahmed
Mohd. Ariffin, Noraini
Ahmad, Maslina
The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
description The purpose of this study is to examine the extent of audit report lag (ARL) and its association with governance mechanisms in the Islamic banking institutions in Malaysia. The extent of ARL lag is defined by the number of days from a company’s financial year-end to the signature date on its audit report. The sample of the study comprises 112 observations of Islamic banking institutions’ financial reports for the period 2008-2014. A balanced panel data analysis is performed to analyse the association between the extent of ARL and governance mechanisms. The findings show that the extent of ARL for the sample selected ranges from a minimum period of 7 days to a maximum period of 161 days which approximately two months on average. A fixed effects analysis indicates that audit committee expertise and audit committee meeting have significant association with the extent of ARL. On the other hand, board independence, audit committee size and Shari’ah board expertise have insignificant association with the extent of ARL. In addition, one control variable (Islamic bank size) is found to be significantly associated with longer ARL. The findings provide useful feedback for Malaysian policymakers on the past and current practices of financial reports and of governance mechanisms. The findings of the study would help the policymakers in monitoring the Islamic banking institutions’ compliance with financial reports submission requirements. The policymakers perhaps could relook into governance mechanisms that could reduce the extent of ARL in the Islamic banking institutions and implement regulations to strengthen them.
format Article
author Kaaroud, Mohamed Ahmed
Mohd. Ariffin, Noraini
Ahmad, Maslina
author_facet Kaaroud, Mohamed Ahmed
Mohd. Ariffin, Noraini
Ahmad, Maslina
author_sort Kaaroud, Mohamed Ahmed
title The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
title_short The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
title_full The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
title_fullStr The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
title_full_unstemmed The extent of audit report lag and governance mechanisms: Evidence from Islamic banking institutions in Malaysia
title_sort extent of audit report lag and governance mechanisms: evidence from islamic banking institutions in malaysia
publisher Emerald Group Publishing
publishDate 2020
url http://irep.iium.edu.my/80466/1/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance.pdf
http://irep.iium.edu.my/80466/2/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_SCOPUS.pdf
http://irep.iium.edu.my/80466/3/80466_The%20extent%20of%20audit%20report%20lag%20and%20governance_WOS.pdf
http://irep.iium.edu.my/80466/
https://www.emerald.com/insight/content/doi/10.1108/JIABR-05-2017-0069/full/html
_version_ 1669007564110561280
score 13.211869

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