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- Title
Audit Report Lag and Submission Approval Lag: The Case of Insurance Companies.
- Authors
Ames, Daniel
- Abstract
I use a firm's risk-based capital (RBC) ratio as a proxy for insolvency risk, and measure time spent by auditors preparing regulatory submissions (audit report lag), and time spent by regulators reviewing audit submissions of these insurance companies (submission approval lag). Results indicate that the file size submitted by insurers varies negatively with RBC and that higher RBCs are associated with faster approval of regulatory submissions. Among riskier firms, higher RBCs are associated with longer processing time, perhaps suggesting that regulators spend the most time examining the filing submissions of firms that are risky, but not firms for whom insolvency is inevitable. Contrary to expectations, audit report lag is not significantly related to RBC.
- Subjects
INSURANCE companies; FINANCIAL risk management; BANKRUPTCY; ECONOMIC policy; AUDITORS' reports
- Publication
Journal of Applied Financial Research, 2013, Vol 2, p10
- ISSN
2381-3105
- Publication type
Article