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Board risk committees and audit report lag

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  • Lemma, Tesfaye T.
  • Kanapathippillai, Sutharson
  • Mihret, Dessalegn G.
  • Puwanenthiren, Premkanth

Abstract

We examine whether and how the presence of a standalone risk management committee (RMC) on a client firm's board of directors is associated with audit report lag (ARL). Analyzing data from firms listed on the Australian Securities Exchange, over the period 2004–2020, we find that firms with a standalone RMC are associated with shorter ARL. This association remains robust after addressing potential firm and year fixed effects and selection bias. Using a sub-sample of firms with a standalone RMC, we examine how RMC characteristics affect ARL. We find that RMC size and overall committee independence are positively associated with ARL, while RMC diligence and RMC Chair independence are inversely associated with it. Overall, the findings underscore that the presence, structure, and functioning of RMCs play a critical role in shaping auditors' assessments and, ultimately, the timeliness of financial reporting.

Suggested Citation

  • Lemma, Tesfaye T. & Kanapathippillai, Sutharson & Mihret, Dessalegn G. & Puwanenthiren, Premkanth, 2026. "Board risk committees and audit report lag," Advances in accounting, Elsevier, vol. 70(C).
    • Handle: RePEc:eee:advacc:v:70:y:2026:i:c:s0882611026000027
    DOI: 10.1016/j.adiac.2026.100867
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