Advanced search
Publication Cover
Cogent Business & Management Volume 10, 2023 - Issue 1
Submit an article Journal homepage
3,888
Views
0
CrossRef citations to date
0
Altmetric
ACCOUNTING, CORPORATE GOVERNANCE & BUSINESS ETHICS

The effect of tax risk on audit report delay: Empirical evidence from Indonesia

Eko Suwardi1 Department of Accounting, Faculty of Economics and Business, Universitas Gadjah Mada, Yogyakarta, IndonesiaCorrespondence[email protected]
ORCID Iconhttps://orcid.org/0000-0002-6083-0095View further author information
ORCID Icon &
Arfah Habib Saragih1 Department of Accounting, Faculty of Economics and Business, Universitas Gadjah Mada, Yogyakarta, Indonesia;2 Department of Fiscal Administration, Faculty of Administrative Sciences, Universitas IndonesiaORCID Iconhttps://orcid.org/0000-0003-4190-3196View further author information
ORCID Icon
Article: 2192315 | Received 17 Feb 2023, Accepted 14 Mar 2023, Published online: 28 Mar 2023

References

  • Abernathy, J. L., Barnes, M., Stefaniak, C., & Weisbarth, A. (2017). An International Perspective on Audit Report Lag: A Synthesis of the Literature and Opportunities for Future Research. International Journal of Auditing, 21(1), 100–19. https://doi.org/10.1111/ijau.12083
  • Abernathy, J. L., Finley, A. R., Rapley, E. T., & Stekelberg, J. (2019). External Auditor Responses to Tax Risk. Journal of Accounting, Auditing & Finance, 36(3), 489–516. https://doi.org/10.1177/0148558X19867821
  • Afify, H. A. E. (2009). Determinants of audit report lag: Does implementing corporate governance have any impact? Empirical evidence from Egypt. Journal of Applied Accounting Research, 10(1), 56–86. https://doi.org/10.1108/09675420910963397
  • Al-Ebel, A., Baatwah, S., Al-Musali, M., & Ntim, C. G. (2020). Religiosity, accounting expertise, and audit report lag: Empirical evidence from the individual level. Cogent Business & Management, 7(1), 1823587. https://doi.org/10.1080/23311975.2020.1823587
  • Almustafa, H., Kijkasiwat, P., Jreisat, A., Al-Mohamad, S., & Khaki, A. R. (2023). Corporate risk-taking and national governance quality: Empirical evidence from MENA emerging markets. Cogent Business & Management, 10(1). https://doi.org/10.1080/23311975.2022.2156141
  • Alsadoun, N., Naiker, V., Navissi, F., & Sharma, D. S. (2018). Auditor-provided tax nonaudit services and the implied cost of equity capital. AUDITING: A Journal of Practice & Theory, 37(3), 1–24. https://doi.org/10.2308/ajpt-51866
  • Al-Shammari, H. A., & Akram, U. (2021). CEO compensation and firm performance: The mediating effects of CEO risk taking behaviour. Cogent Business & Management, 8(1). https://doi.org/10.1080/23311975.2021.1894893
  • Alsmady, A. A. (2022). Accounting information quality and tax avoidance effect on investment opportunities evidence from Gulf Cooperation Council GCC. Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2143020
  • Arlinghaus, B. P. (1998). Goal setting and performance measures. Tax Executive, 50(6), 434–441. Retrieved from. https://www.proquest.com/trade-journals/goal-setting-performance-measures/docview/212263485/se-2?accountid=17242
  • Asiriuwa, O., Adeyemi, S. B., Uwuigbe, O. R., Uwuugbe, U., & Ozordi, E. (2021). Tax Aggressiveness and Timeliness of Financial Reporting in Nigeria Financial Sector. Academy of Accounting and Financial Studies Journal, 25(6), 1–11.
  • Bajary, A. R., Shafie, R., & Ali, A. (2023). COVID-19 Pandemic, Internal Audit Function and Audit Report Lag: Evidence from Emerging economy COVID-19 Pandemic, Internal Audit Function and Audit Report Lag: Evidence from Emerging economy. Cogent Business & Management, 10(1). https://doi.org/10.1080/23311975.2023.2178360
  • Bame-Aldred, C. W., Cullen, J. B., Martin, K. D., & Parboteeah, K. P. (2013). National culture and firm-level tax evasion. Journal of Business Research, 66(3), 390–396. https://doi.org/10.1016/j.jbusres.2011.08.020
  • Beasley, M. S., Goldman, N. C., Lewellen, C. M., & McAllister, M. (2021). Board risk oversight and corporate tax-planning practices. Journal of Management Accounting Research, 33(1), 7–32. https://doi.org/10.2308/JMAR-19-056
  • Belina, H. (2022). “Surprise” material weakness disclosures: Effects on audit fees and audit report lags. Journal of Accounting and Public Policy, 404(6), 106979. https://doi.org/10.1016/j.jaccpubpol.2022.106979
  • Block, J. H., Fisch, C., Kanwal, N., Lorenzen, S., & Schulze, A. (2022). Replication studies in top management journals: An empirical investigation of prevalence, types, outcomes, and impact. Management Review Quarterly. https://doi.org/10.1007/s11301-022-00269-6
  • Block, J., & Kuckertz, A. (2018). Seven principles of effective replication studies: Strengthening the evidence base of management research. Management Review Quarterly, 68(4), 355–359. https://doi.org/10.1007/s11301-018-0149-3
  • Boateng, K., Omane-Antwi, K. B., & Ndori Queku, Y. (2022). Tax risk assessment, financial constraints and tax compliance: A bibliometric analysis. Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2150117
  • Bryan, D. B., & Mason, T. W. (2020). Earnings volatility and audit report lag. Advances in Accounting, 51(xxxx), 100496. https://doi.org/10.1016/j.adiac.2020.100496
  • Campbell, J. L., Cecchini, M., Cianci, A. M., Ehinger, A. C., & Werner, E. M. (2019). Tax-related mandatory risk factor disclosures, future profitability, and stock returns. Review of Accounting Studies, 24(1), 264–308. https://doi.org/10.1007/s11142-018-9474-y
  • Chen, W. (2020). Tax risks control and sustainable development: Evidence from China. Meditari Accountancy Research, 29(6), 1381–1400. https://doi.org/10.1108/MEDAR-05-2020-0884
  • Chen, W. (2021). Too far east is west: Tax risk, tax reform and investment timing. International Journal of Managerial Finance, 17(2), 303–326. https://doi.org/10.1108/IJMF-03-2020-0132
  • Chen, X., Cheng, Q., Chow, T., & Liu, Y. (2021). Corporate in-house tax departments. Contemporary Accounting Research, 38(1), 443–482. https://doi.org/10.1111/1911-3846.12637
  • Chen, H., Yang, D., Zhang, X., & Zhou, N. (2020). The moderating role of internal control in tax avoidance: Evidence from a COSO-Based internal control index in China. Journal of the American Taxation Association, 42(1), 23–55. https://doi.org/10.2308/atax-52408
  • Cho, M., & Krishnan, G. V. (2021). Principles-based accounting standards and audit outcomes: Empirical evidence. Review of Accounting Studies. https://doi.org/10.2139/ssrn.3821688
  • Cobham, A., Bernardo, J. G., Palansky, M., & Mansour, M. B. (2020). The State of Tax Justice 2020: Tax Justice in the time of COVID-19. Tax Justice Network, (November), 1–83. Retrieved from https://www.taxjustice.net/reports/the-state-of-tax-justice-2020/
  • Crabtree, A. D., & Kubick, T. R. (2014). Corporate tax avoidance and the timeliness of annual earnings announcements. Review of Quantitative Finance and Accounting, 42(1), 51–67. https://doi.org/10.1007/s11156-012-0333-9
  • Deloitte. (2017). Tax and the CTO or CIO (pp. 1–2). pp. 1–2. Retrieved from https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/dttl-tax-and-the-cto-or-cio.pdf
  • Donohoe, M. P., & Knechel, W. R. (2014). Does corporate tax aggressiveness influence audit pricing? Contemporary Accounting Research, 31(1), 284–308. https://doi.org/10.1111/1911-3846.12027
  • Drake, K. D., Lusch, S. J., & Stekelberg, J. (2019). Does Tax Risk Affect Investor Valuation of Tax Avoidance? Journal of Accounting, Auditing & Finance, 34(1), 151–176. https://doi.org/10.1177/0148558X17692674
  • Drake, K. D., Lusch, S. J., & Stekelberg, J. (2019). Does Tax Risk Affect Investor Valuation of Tax Avoidance?. Journal of Accounting, Auditing & Finance, 34(1), 151–176. https://doi.org/10.1177/0148558x17692674
  • Durand, G. (2019). The determinants of audit report lag: A meta-analysis. Managerial Auditing Journal, 34(1), 44–75. https://doi.org/10.1108/MAJ-06-2017-1572
  • Dyreng, S. D., Hanlon, M., & Maydew, E. L. (2019). When does tax avoidance result in tax uncertainty? The Accounting Review, 94(2), 179–203. https://doi.org/10.2308/accr-52198
  • Fakhfakh Sakka, I., Jarboui, A., & Bisogno, M. (2016). Audit reports timeliness: Empirical evidence from Tunisia. Cogent Business & Management, 3(1), 1195680. https://doi.org/10.1080/23311975.2016.1195680
  • Gallemore, J., & Labro, E. (2015). The importance of the internal information environment for tax avoidance. Journal of Accounting and Economics, 60(1), 149–167. https://doi.org/10.1016/j.jacceco.2014.09.005
  • Gontara, H., Khelil, I., & Khlif, H. (2022). The association between internal control quality and audit report lag in the French setting: The moderating effect of family directors. Journal of Family Business Management. https://doi.org/10.1108/JFBM-11-2021-0139
  • Gontara, H., & Khlif, H. (2020). Tax avoidance and audit report lag in South Africa: The moderating effect of auditor type. Journal of Financial Crime, 28(3), 732–740. https://doi.org/10.1108/JFC-09-2020-0197
  • Guenther, D. A., Matsunaga, S. R., & Williams, B. M. (2017). Is tax avoidance related to firm risk? The Accounting Review, 92(1), 115–136. https://doi.org/10.2308/accr-51408
  • Gujarati, D. N., & Porter, D. C. (2009). Basic Econometrics (fifth ed.). McGraw-Hill.
  • Habib, A. (2015). The new Chinese accounting standards and audit report lag. International Journal of Auditing, 19(1), 1–14. https://doi.org/10.1111/ijau.12030
  • Habib, A., Bhuiyan, M. B. U., Huang, H. J., & Miah, M. S. (2019). Determinants of audit report lag: A meta-analysis. International Journal of Auditing, 23(1), 20–44. https://doi.org/10.1111/ijau.12136
  • Hamilton, R., & Stekelberg, J. (2017). The effect of high-quality information technology on corporate tax avoidance and tax risk. Journal of Information Systems, 31(2), 83–106. https://doi.org/10.2308/isys-51482
  • Hasan, I., Kim, I., Teng, H., & Wu, Q. (2022). The effect of foreign institutional ownership on corporate tax avoidance: International evidence. Journal of International Accounting, Auditing and Taxation, 46, 100440. https://doi.org/10.1016/j.intaccaudtax.2021.100440
  • Hossain, M., & Mitra, S. (2022, August). Do auditors account for firm-level political risk? International Journal of Auditing, 26(4), 534–552. https://doi.org/10.1111/ijau.12294
  • Hsu, H. T., & Khan, S. (2019). Chief accounting officers and audit efficiency. Asian Review of Accounting, 27(4), 614–638. https://doi.org/10.1108/ARA-09-2018-0171
  • Jacob, M., & Schütt, H. H. (2020). Firm Valuation and the Uncertainty of Future Tax Avoidance. European Accounting Review, 29(3), 409–435. https://doi.org/10.1080/09638180.2019.1642775
  • Jankensgård, H. (2019). A theory of enterprise risk management. Corporate Governance (Bingley), 19(3), 565–579. https://doi.org/10.1108/CG-02-2018-0092
  • Kabuye, F., Bugambiro, N., Akugizibwe, I., Nuwasiima, S., Naigaga, S., & Ntim, C. G. (2019). The influence of tone at the top management level and internal audit quality on the effectiveness of risk management practices in the financial services sector. Cogent Business & Management, 6(1). https://doi.org/10.1080/23311975.2019.1704609
  • Kafidipe, A., Uwalomwa, U., Dahunsi, O., Okeme, F. O., & Ntim, C. G. (2021). Corporate governance, risk management and financial performance of listed deposit money bank in Nigeria. Cogent Business & Management, 8(1). https://doi.org/10.1080/23311975.2021.1888679
  • Kanagaretnam, K., Lee, J., Lim, C. Y., & Lobo, G. J. (2016). Relation between auditor quality and tax aggressiveness: Implications of cross-country institutional differences. AUDITING: A Journal of Practice & Theory, 35(4), 105–135. https://doi.org/10.2308/ajpt-51417
  • Kanagaretnam, K., Lee, J., Lim, C. Y., & Lobo, G. J. (2018). Cross-Country Evidence on the Role of Independent Media in Constraining Corporate Tax Aggressiveness. Journal of Business Ethics, 150(3), 879–902. https://doi.org/10.1007/s10551-016-3168-9
  • Kassem, R. (2022). Elucidating corporate governance’s impact and role in countering fraud. Corporate Governance (Bingley), 22(7), 1523–1546. https://doi.org/10.1108/CG-08-2021-0279
  • Khlif, H., & Achek, I. (2016). IFRS adoption and auditing: A review. Asian Review of Accounting, 24(3), 338–361. https://doi.org/10.1108/ARA-12-2014-0126
  • Khuong, N. V., Liem, N. T., Thu, P. A., Khanh, T. H. T., & Ntim, C. G. (2020). Does corporate tax avoidance explain firm performance? Evidence from an emerging economy. Cogent Business & Management, 7(1), 1780101. https://doi.org/10.1080/23311975.2020.1780101
  • Kiptoo, I. K., Kariuki, S. N., Ocharo, K. N., & McMillan, D. (2021). Risk management and financial performance of insurance firms in Kenya. Cogent Business & Management, 8(1). https://doi.org/10.1080/23311975.2021.1997246
  • Knechel, W. R., & Payne, J. L. (2001). Additional evidence on audit report lag. AUDITING: A Journal of Practice & Theory, 20(1), 137–146. https://doi.org/10.2308/aud.2001.20.1.137
  • Koester, A., Shevlin, T., & Wangerin, D. (2016). The role of managerial ability in corporate tax avoidance. Management Science, 63(10), 1–27. https://doi.org/10.1287/mnsc.2016.2510
  • Kovermann, J. H. (2018). Tax avoidance, tax risk and the cost of debt in a bank-dominated economy. Managerial Auditing Journal, 33(8–9), 683–699. https://doi.org/10.1108/MAJ-12-2017-1734
  • Lajmi, A., & Yab, M. (2021). The impact of internal corporate governance mechanisms on audit report lag: Evidence from Tunisian listed companies. EuroMed Journal of Business, 17(4), 619–633. https://doi.org/10.1108/EMJB-05-2021-0070
  • Li, Q., Maydew, E. L., Willis, R. H., & Xu, L. (2022). Taxes and director independence: Evidence from board reforms worldwide. Review of Accounting Studies. https://doi.org/10.1007/s11142-021-09660-2
  • Lin, X., Liu, M., So, S., & Yuen, D. (2019). Corporate social responsibility, firm performance and tax risk. Managerial Auditing Journal, 34(9), 1101–1130. https://doi.org/10.1108/MAJ-04-2018-1868
  • Liu, H., Cullinan, C., & Zhang, J. (2021). Litigation against clients and audit report lag: An examination of the role of state ownership and regional legal development in China. Managerial Auditing Journal, 36(5), 744–769. https://doi.org/10.1108/MAJ-02-2020-2557
  • Mathew, S., Ibrahim, S., & Archbold, S. (2018). Corporate governance and firm risk. Corporate Governance (Bingley), 18(1), 52–67. https://doi.org/10.1108/CG-02-2017-0024
  • Mills, L. F., & Sansing, R. C. (2000). Strategic Tax and Financial Reporting Decisions: Theory and Evidence. Contemporary Accounting Research, 17(1), 85–106. https://doi.org/10.1111/j.1911-3846.2000.tb00912.x
  • Moore, R. D. (2021). The concave association between tax reserves and equity value. Journal of the American Taxation Association, 43(1), 107–124. https://doi.org/10.2308/JATA-17-109
  • Munsif, V., Raghunandan, K., & Rama, D. V. (2012). Internal control reporting and audit report lags: Further evidence. AUDITING: A Journal of Practice & Theory, 31(3), 203–218. https://doi.org/10.2308/ajpt-50190
  • Musimenta, D., & Ntim, C. G. (2020). Knowledge requirements, tax complexity, compliance costs and tax compliance in Uganda. Cogent Business & Management, 7(1), 1812220. https://doi.org/10.1080/23311975.2020.1812220
  • Neuman, S. S., Omer, T. C., & Schmidt, A. P. (2020). Assessing Tax Risk: Practitioner Perspectives. Contemporary Accounting Research, 37(3), 1788–1827. https://doi.org/10.1111/1911-3846.12556
  • Nguyen, J. H. (2020). Tax Avoidance and financial statement readability. European Accounting Review, 30(5), 1043–1066. https://doi.org/10.1080/09638180.2020.1811745
  • Oussii, A. A., & Boulila Taktak, N. (2018). Audit committee effectiveness and financial reporting timeliness: The case of Tunisian listed companies. African Journal of Economic and Management Studies, 9(1), 34–55. https://doi.org/10.1108/AJEMS-11-2016-0163
  • Raimo, N., NIcolò, G., Tartaglia Polcini, P., & Vitolla, F. (2022). Corporate governance and risk disclosure: Evidence from integrated reporting adopters. Corporate Governance (Bingley), 22(7), 1462–1490. https://doi.org/10.1108/CG-07-2021-0260
  • Rasheed, P. C., Hawaldar, A., T, I., T, M., & Ntim, C. G. (2021). Related party transactions and audit risk. Cogent Business & Management, 8(1). https://doi.org/10.1080/23311975.2021.1888669
  • Raweh, N. A. M., Abdullah, A. A. H., Kamardin, H., Malek, M., & Ntim, C. G. (2021). Industry expertise on audit committee and audit report timeliness. Cogent Business & Management, 8(1). https://doi.org/10.1080/23311975.2021.1920113
  • Saggar, R., & Singh, B. (2017). Corporate governance and risk reporting: Indian evidence. Managerial Auditing Journal, 32(4–5), 378–405. https://doi.org/10.1108/MAJ-03-2016-1341
  • Saragih, A. H., & Ali, S. (2021). Corporate tax risk: A literature review and future research directions. Management Review Quarterly. https://doi.org/10.1007/s11301-021-00251-8
  • Saragih, A. H., & Ali, S. (2022a). The effect of XBRL adoption on corporate tax avoidance: Empirical evidence from an emerging country. Journal of Financial Reporting and Accounting, Ahead-Of-P(ahead-Of-Print). https://doi.org/10.1108/jfra-09-2021-0281
  • Saragih, A. H., & Ali, S. (2022b). The role of XBRL adoption on the association between managerial ability and corporate tax outcomes: Empirical evidence from Indonesia. Journal of Applied Accounting Research, 24(2), 217–234. https://doi.org/10.1108/JAAR-10-2021-0267
  • Saragih, A. H., & Ali, S. (2023). The impact of managerial ability on corporate tax risk and long-run tax avoidance: Empirical evidence from a developing country. Corporate Governance the International Journal of Business in Society. https://doi.org/10.1108/CG-08-2022-0346
  • Singh, H., Sultana, N., Islam, A., & Singh, A. (2022). Busy auditors, financial reporting timeliness and quality. The British Accounting Review, 54(3), 101080. https://doi.org/10.1016/j.bar.2022.101080
  • Sultana, N., Singh, H., & Van der Zahn, J. L. W. M. (2015). Audit Committee Characteristics and Audit Report Lag. International Journal of Auditing, 19(2), 72–87. https://doi.org/10.1111/ijau.12033
  • Światowiec-Szczepańska, J., & Stępień, B. (2022). Impact of corporate network position on strategic risk and company’s performance – evidence from Poland. Corporate Governance (Bingley), 22(5), 947–978. https://doi.org/10.1108/CG-02-2021-0061
  • Thi Pham, P. M., & Thi Dao, B. T. (2022). A meta-analysis of risk taking and corporate performance. Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2064263
  • Towery, E. M. (2017). Unintended consequences of linking tax return disclosures to financial reporting for income taxes: Evidence from schedule UTP. The Accounting Review, 92(5), 201–226. https://doi.org/10.2308/accr-51660
  • Waris, M., & Haji Din, B. (2023). Impact of corporate governance and ownership concentrations on timelines of financial reporting in Pakistan. Cogent Business & Management, 10(1). https://doi.org/10.1080/23311975.2023.2164995
  • Watrin, C., Burggraef, S., & Weiss, F. (2019). Auditor-provided tax services and accounting for tax uncertainty. The International Journal of Accounting, 54(3), 1950011. https://doi.org/10.1142/S1094406019500112
  • Yeboah, E. N., Addai, B., & Appiah, K. O. (2023). Audit pricing puzzle: Do audit firm industry specialization and audit report lag matter? Cogent Business & Management, 10(1). https://doi.org/10.1080/23311975.2023.2172013
  • Zeng, T. (2019). Country-level governance, accounting standards, and tax avoidance: A cross-country study. Asian Review of Accounting, 27(3), 401–424. https://doi.org/10.1108/ARA-09-2018-0179
  • Zhou, Y., Liu, J., & Lei, D. (2022). The effect of financial reporting regimes on audit report lags and audit fees: Evidence from firms cross-listed in the USA. Journal of Financial Reporting and Accounting. https://doi.org/10.1108/JFRA-09-2021-0261

Related research

People also read lists articles that other readers of this article have read.

Recommended articles lists articles that we recommend and is powered by our AI driven recommendation engine.

Cited by lists all citing articles based on Crossref citations.
Articles with the Crossref icon will open in a new tab.