Late for a very important date: financial reporting and audit implications of late 10-K filings

Cao, Jian; Chen, Feng; Higgs, Julia L.

doi:10.1007/s11142-016-9351-5

Cited by 50 publications

(27 citation statements)

References 68 publications

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“…Healy and Palepu (2001) provide an extensive overview of the determinants and economic consequences of corporate financial reporting and disclosure. Cao, Chen and Higgs (2016) find late filing corporations to be associated with lower financial reporting quality compared with timely filing firms. Bartov, DeFond and Konchitchki (2013) find the market reacts negatively to late filing announcements by corporations, −2.93% for untimely quarterly filings and −1.96% for untimely annual filings.…”

Section: Municipal Bond and Financial Disclosure Literaturementioning

confidence: 85%

“…Mazumdar and Sengupta (, p. 83) note lower costs of public equity and debt for companies who “consistently make detailed, timely, and informative disclosures.” Francis, Khurana and Pereira (), Goldstein, Hotchkiss and Sirri (), and Cheng, Collins and Huang (, p. 175), find firms with greater financial transparency enjoy “significantly lower costs of equity capital.” Healy and Palepu () provide an extensive overview of the determinants and economic consequences of corporate financial reporting and disclosure. Cao, Chen and Higgs () find late filing corporations to be associated with lower financial reporting quality compared with timely filing firms. Bartov, DeFond and Konchitchki () find the market reacts negatively to late filing announcements by corporations, −2.93% for untimely quarterly filings and −1.96% for untimely annual filings.…”

Section: Municipal Bond and Financial Disclosure Literaturementioning

confidence: 99%

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Municipal Disclosure Timeliness and the Cost of Debt

Sherrill

Yerkes

2018

The Financial Review

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A longstanding concern for municipal bond investors is the lack of timely financial statement disclosures. Municipalities are held to lower disclosure standards than corporations. Using continuing disclosure dates for audited financial statements, we find bond issuers with slower disclosure have higher secondary market yields and spreads, less frequent secondary market trading, and are less likely to issue new bonds. We observe that future disclosure is largely predictable based on past disclosure and that disclosure often improves prior to new bond issuances. When municipalities do not capitalize on the benefits of timely disclosure, economic consequences are imposed on bondholders and taxpayers.

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Section: Municipal Bond and Financial Disclosure Literaturementioning

confidence: 85%

Section: Municipal Bond and Financial Disclosure Literaturementioning

confidence: 99%

Municipal Disclosure Timeliness and the Cost of Debt

Sherrill

Yerkes

2018

The Financial Review

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“…Terkait likuiditas (liquidity), rasio diarti kan sebagai kapasitas suatu perusahaan un tuk membayar kewajiban lancarnya (Azami & Salehi, 2017;Habbash & Alghamdi, 2017;Kandemir, 2013;Merawati & Haryani, 2015;Muhsin, 2018). Likuiditas dianggap bisa mengukur kemampuan aset likuid untuk memenuhi liabilitas lancarnya (Cao, Chen, & Higgs, 2016;Fung, Zhou, & Zhu, 2016;Kleinman & Lin, 2017). Verawaty, Jaya, & Megawati (2016) berargumen bahwa likuiditas menunjukkan kapasitas dan kapabilitas perusahaan untuk melunasi short term lia bility.…”

Section: Metodeunclassified

Implikasi Likuiditas Perusahaan Bagi Opinion Shopping

Verawaty

Jaya

Pratiwi

2018

jamal

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Implikasi Likuiditas Perusahaan bagi Opinion Shopping. Penelitian ini menguji pengaruh opinion shopping terhadap biaya audit abnormal, likuiditas, profitabilitas, dan lamanya perikatan audit. Pene litian ini menggunakan metode regresi logistik terhadap 40 perusahaan terbuka sektor manufaktur di Indonesia. Hasil analisis mununjukkan bahwa perusahaan mengalami kendala jika kurang likuid karena tidak dapat memenuhi kompensasi bagi stakeholder kreditur. Hal ini diyakini memperkuat probabilitas manajemen untuk melakukan opinion shopping demi mendapat opini wajar tanpa pengecualian. Oleh karena itu, akun tan profesional harus memegang teguh kode etik profesi untuk menjaga integritas dengan mengeluarkan opini sesuai kondisi yang sebenarnya.

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“…The study is a useful extension of Cao et al. (), who investigate late 10K filers’ financial reporting and audit quality, Wang et al. (), who examine auditors’ subsequent fee adjustments to late 10K filing incidents, and Zhang (), who documents managers’ trade‐offs between two earnings management methods based on their relative costs.…”

Section: Introductionmentioning

confidence: 99%

“…Firms’ failure to submit their annual financial reports on time leads to investor skepticism, significant adverse market reaction, and declined share prices (e.g., Bartov & Konchitchki, ; Impink, Lubberink, van Praag, & Veenman, ). Cao, Chen, and Higgs () document that late 10K filers have poor financial reporting quality as measured by discretionary accruals, and higher probability of financial restatements in subsequent periods, but the adverse consequence of late filing is largely mitigated by Big 4 auditors. In this respect, Wang, Raghunandan, and McEwen () find that late 10K filing has negative implications for audit fees, resulting in higher audit fees for the late filers.…”

Section: Introductionmentioning

confidence: 99%

Does late 10K filing impact companies’ financial reporting strategy? Evidence from discretionary accruals and real transaction management

Mitra

Al-Hayale

Hossain

2019

Business Fin & Account

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The study investigates how late 10K filers adapt their financial reporting strategy in the post-late filing period in their response to bad publicity, negative market sentiment, and higher stakeholders' scrutiny resulting from reporting delays. Both the level and change regressions show that late 10K filers significantly reduce the use of discretionary accruals from pre-to post-late filing year. However, they simultaneously increase real transaction management over the same time period. The trade-offs between the two earnings management techniques are more prominent when the late filers have a strong incentive to meet or beat earnings benchmarks. Our primary results are robust when late filings are caused by accounting, auditing, and internal control issues, and when the late filers cited no meaningful reason for late 10K filings. It is further evident that late filers with material internal control weaknesses and late filers that subsequently restate their financial statements make relatively higher trade-offs than the matched non-late filers. Finally, the tradeoffs between reduced accruals and increased real transaction management are stronger for the accelerated filers, and for the late filers audited by Big 4 auditors.

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Late for a very important date: financial reporting and audit implications of late 10-K filings

Cited by 50 publications

References 68 publications

Municipal Disclosure Timeliness and the Cost of Debt

Municipal Disclosure Timeliness and the Cost of Debt

Implikasi Likuiditas Perusahaan Bagi Opinion Shopping

Does late 10K filing impact companies’ financial reporting strategy? Evidence from discretionary accruals and real transaction management

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