Global Demand for Timely Financial Reporting: How Prepared are Nigerian Companies?

Abstract

The objective of the study is to determine the trends in delays in corporate financial reporting in Nigeria. Three types of delay in financial reporting were identified: audit, management and total delays. Data were obtained from the annual reports and accounts of Seventy Five (75) companies quoted on the Nigerian Stock Exchange from 2000 to 2010. The trends in delay in corporate financial reporting were analysed using three-year moving average method and simple ordinary least square regression. The results showed that on the average the audit delay was about 163 days while management delay and total delay were 92 days and 255 days respectively. These appeared comparatively higher than in most countries of the world. The trend analysis by three-year moving average and simple regression showed that delays in corporate financial reporting had been on the decline over time but audit delay declined faster than the management and total delays during the period under study just as it was in Egypt (Akle, 2011) and Malaysia (Hashim & Abdul-Rahman, 2011). To ensure early corporate financial reporting, it was recommended that the supervisory authorities should make the mandatory financial reporting time to be 90 days after the balance sheet dates for all public companies. Stiffer penalties (in terms of monetary fines) should be imposed against non-compliance.

Keywords: Audit delay, management delay, total delay, corporate financial reporting