Are country-level political uncertainty and power distance important to the CSR-audit report lag nexus? Evidence from the GCC region

Mujeeb Saif Al-Absi, Redhwan Al-Dhamari, Hamid Abdulkhaleq Hasan Al-Wesabi*, Khaldoon Albitar

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

This study examines the effect of corporate social responsibility (CSR) performance on audit report lag and whether political uncertainty and power distance levels impact such association. We find that audit report lag is significantly lower for firms with a high CSR performance. We further find that the impact is evident only for large firms and those whose financial reports are audited by highquality auditors. However, our analysis suggests that political uncertainty and power distance intensity do not moderate the association between CSR performance and audit report lag. Our results remain robust after excluding some control variables, addressing the endogeneity issues, and using alternative audit report lag measures. This study contributes to audit delay literature by recognising CSR practices as a determinant of audit report lag in the GCC setting. The findings of this study carry valuable practical implications for regulatory bodies, policymakers, investors, and managers in the GCC region.

Original languageEnglish
JournalJournal of Sustainable Finance and Investment
Early online date19 Jan 2024
DOIs
Publication statusEarly online - 19 Jan 2024

Keywords

  • audit report lag
  • CSR performance
  • political uncertainty
  • power distance
  • the GCC region

Cite this