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Audit Qualification Paragraphs and Audit Report Lag: Evidence from Iran.

Faraji, O., MohammadRezaei, F., Yazdifar, H., Ahmed, K. and Najafi Gadikelaei, Y., 2023. Audit Qualification Paragraphs and Audit Report Lag: Evidence from Iran. Spanish Journal of Finance and Accounting, 52 (3), 348-383.

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AQPs and ARL - Final Submission and Accepted - with authors details.pdf - Accepted Version
Available under License Creative Commons Attribution Non-commercial.


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DOI: 10.1080/02102412.2022.2086731


We investigate whether the number and type (the nature and repetitiveness) of audit qualification paragraphs (AQPs) play a role in audit report lag (ARL). We use a unique dataset of listed firms in Iran where the multitude and diversity of AQPs are very high. The results show that ARL is longer for firms with a greater number of AQPs, that there is a significant positive relationship between all AQP types and ARL except for misclassification of accounting numbers in financial statements, and that ARL increases with the number of non-repetitive AQPs. We employed several sensitivity tests, and the results did not change materially. Drawing on prior studies, we have developed two arguments, “additional audit procedures” and “auditor-client negotiations”, to explain the role of the number and type of AQPs on ARL. The findings of this study have significant implications for investors, auditors and authority bodies in terms of paying close attention to the number and type of AQPs in their decisions.

Item Type:Article
Uncontrolled Keywords:Audit qualification paragraphs (AQPs); number and reasons for AQPs; AQPs’ repetitiveness; audit report lag (ARL)
Group:Bournemouth University Business School
ID Code:37014
Deposited By: Symplectic RT2
Deposited On:06 Jun 2022 10:36
Last Modified:20 May 2024 12:53


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