The effect of earnings volatility and earnings autocorrelation on audit report lag in firms listed in Tehran stock exchange

Audit report lag (ARL) is important issue that identifies the factors affecting it play an important role in the timely decision of investors. Among these, earnings autocorrelation and earnings volatility are important features of earnings that affect audit risk and increase the delay in the audit report. In the present study, earnings volatility and earnings autocorrelation were considered as effective factors on audit report and the adjusting role of the Auditor industry Specialization on these relationships was investigated. For this purpose, the information of 100 companies listed on the Tehran Stock Exchange (TSE) in the period 2014 to 2020 was extracted and analyzed using Eviews12 software. The results of testing the research hypotheses show that there is a positive and significant relationship between earnings volatility and audit report lag. There is also a negative and significant relationship between earnings autocorrelation and the audit report lag. In other words, the higher the volatility (autocorrelation) of earnings, the more (less) the audit report lag. Also, the auditor industery specialization, contrary to expectations, does not have a significant adjustment effect on the relationship between earnings volatility and earnings autocorrelation with the audit report lag.