Financial reporting lag during COVID-19: evidence from flash reporting in Japan

Abstract

Considering the waiver of the 'within 45 days' rule in Japan following the coronavirus disease 2019 pandemic, we conduct empirical investigations to examine the determinants of the timeliness of flash reporting and the market reactions to flash announcements during the pandemic, distinguishing between early and late filers and between the 'waiver' year (2020) and 'non-waiver' year (2021). We find that the complexity of operations and earnings news explain the observed reporting delay. We also find significant support for market reactions to flash reporting, suggesting that the waiver policy has no significant impact on the information value of flash announcements.

Corporate governance dynamics: How audit committees and board characteristics influence firm value through audit report lag?

“…When financial reports are not published promptly, they can negatively impact corporate value (Blankley et al, 2014) and damage the firm's reputation (Asante-Appiah, 2020). Moreover, such delays can trigger unfavorable market reactions (Lawal & Shinozawa, 2024), investor response, and legal compliance pressure (Kamil et al, 2023).…”

“…Specifically, the main objective is to investigate the mediating effect of ARL on the relationship between corporate governance attributes, such as the board of directors and audit committee, and firm value in property and real estate companies in Indonesia. According to signaling theory, enhancing the transparency of audit reports can improve firm performance and market reactions (Blankley et al, 2014;Lawal & Shinozawa, 2024). ARL is a suitable mediating variable because the timeliness of financial report delivery serves as a signal that influences investors, even when the company implements good corporate governance.…”

“…ARL is a suitable mediating variable because the timeliness of financial report delivery serves as a signal that influences investors, even when the company implements good corporate governance. This is supported by the audit dimension, which reflects that internal company policies significantly impact ARL, affecting performance and investor reactions (Blankley et al, 2014;Kamil et al, 2023;Lawal & Shinozawa, 2024). Considering these phenomena, theories, and prior research, this study aims to determine whether corporate governance attributes, particularly the board of directors and audit committee, contribute to increasing the value of property and real estate companies in Indonesia while testing ARL's mediating effect on this relationship.…”