Open AccessCEO’S GENDER, POWER, OWNERSHIP: ROLES ON AUDIT REPORT LAG
Author(s) -
Sarini Azizan
Publication year - 2019
Publication title -
management and accounting review/management and accounting review
Language(s) - English
Resource type - Journals
eISSN - 2600-7975
pISSN - 2550-1895
DOI - 10.24191/mar.v18i2.958
Subject(s) - audit , accounting , business , corporate governance , auditor's report , lag , diversity (politics) , quality audit , joint audit , internal audit , finance , political science , computer network , computer science , law
This study examines the role of CEO’s gender, power and ownership on audit report lag. The rapid changes of market regulations and societal norms make CEO’s characteristics emerge as evolving risk factors for corporate governance and audit research. This raises the importance for research to understand their dynamic influences on corporate financial disclosure quality specifically, timeliness. This study hypothesises that different CEO’s characteristics set different tones to the audit discussion in the boardroom. To test the hypothesis, this study uses multiple secondary data from Compustat, Audit Analytics Execucomp and BoardEX. The CEO’s characteristics are divided to three dimensions that measure gender diversity, power and ownership concentration. This study provides evidence that both CEO’s ownership and power, which proxied by (1) industrial experience and (2) social network size are significantly associated with audit report lag. However, only the association with the CEO’s power reduces audit report lag and CEO’s ownership increases it. With regards to the gender diversity, it is only effective in reducing audit report lag if other CEO’s characteristics are also presence. Overall, the results provide support the study proposition in respect of the role of CEO’s characteristics towards promoting financial reporting timeliness.