Introduction
The financial system in regard of whole world was affected during the crisis time of
financial condition at global level. The crisis developed a large number of problems at
international level. The most effected financial markets were of the United States of
America and Europe. It developed a need to study and conduction of researches in
order to identify the reason behind the financial crisis. The explanations of the
responsible factors were examined at a common view. The nature of crisis at global
level was observed as an effort at consistent international governing reactions by G20
and encouraging developments in the working structure and roles of global companies
in order to gain their targets. It is the fact that there are different types of responses
which are considered by companies and individuals, building the mission of evaluating
the probable penalties and qualities of people actions which are very difficult. Here, the
question arises is whether different opinions provided by different people can bring
changes in the financial sector of market. According to Ashton (1987), Audit delay
shows a number of days from the end of fiscal year of company to the date on which the
auditor submits the report. The past studies were focusing on the characteristics of
customers and auditors along with their effects on the audit delay. The most important
elements in this regard were the size of customers along with the tendency and size of
auditors. Some articles have presented particular procedures implemented by the
auditor for auditing purposes and those procedures may link with the delay of audit. One
of the most important factors in the research is the personnel availability. According to
the report of Knechel and Payne (2001), audit delay can occur by giving the task to
those auditors that have very little practical experience. In same way according to Behn
et al. (2006) unavailability of the resources in regard of personnel both in respect of
customers and auditor could also be the reason of delay in audit.
The most important factor which will give more focus in this research is the sufficiency
of personnel. According to the report of McGee (2005) and Gullapalli (2005) pressure of
time is identified as an important factor in efficient audit with the suggestion that the
auditors always have a fear of liability in their mind which delays the audit in some
circumstances.They in similar way believe that a deficiency of experts occurred in the
inspecting sector during their time of sample selection. Absence of work force might
constitute critical hurdles to adding more outside staff to a review. Besides, ought to the
outside reviewer adds staff to a specific engagement, such staff are unrealistic to have
as much client specific and/or industry-particular experience, in this manner upsetting
activities to assist the audit (Lambert et al. 2010).
before the issuance of auditor report on the base of his finding. The report given by the
auditor is then presented to the shareholders of company.it is the fact that completion of
time for audit is depend on the decision and procedures taken by the auditor for the
completion of audit(Almosa & Alabbas 2008, Wermert et al. 2000, and Bamber (1993).
According to the report of the Newton and Ashton (1989) there is a need of deep
analysis for productive assessment in order to identify the reasons for delaying the
audit. The delay in audit can be different for different organizations. Bamber et al. (1993)
suggested that there are basically two types of organizations, one is known as financial
organizations and other is non-financial organizations.
They struggled that financial segment signifies a fewer compound auditee and so
should practice smaller audit delay. It is also well known that financial companies are
subject to dissimilar rule and actions and are observed carefully by the officials. Audit
delay looks to be negatively affected by the growth of accounting reporting rules such
as the introduction of SOX (Lambert et al. 2010; Ettredge et al. 2006), therefore, it is
essential to advance an sympathetic of the issues that affect audit delay (Abbott et al.
2012).
Kinney and McDaniel (1993) note that audit delay may be produced by accounting
errors, the presence of which would require a growth of the external audit opportunity to
achieve assurance and would increase the time spent on auditor-client negotiations
regarding these errors. Audit delays seem to also be affected by the operating capacity
of the audit firm. As an audit firm operates at or above full capacity, audit delays seem
to ensue (Masli et al. 2010; Lambert et al. 2010; Gullapalli 2005).
Internal audit functions in firms have a significant role to play in a companys controls
system. Internal auditors help in the design and strengthening of firms systems of
internal controls over financial reporting (ICFR). Strong ICFR systems help external
auditors by providing a good degree of confidence that reduces exhaustive time
consuming substantive testing (Pizzini et al., 2015). Thus the work required for an
external audit is significantly affected by internal controls (Givoly and Palmon, 1982;
Ashton, Graul and Newton, 1989; Newton and Ashton, 1989; Bamber et al., 1993).
Internal auditors could also help external auditors in the external audit procedures
(AICPA, 1991 -322.24-27; PCAOB 2004, 2007a); this provides external auditors with a
larger audit team, a step that enhances the efficiency and effectiveness of external
audits (Schneider, 2009; PCAOB 2005, 2007b), and this would, in its turn, allow for
shorter audits (IIA, 2004, 2011; Pizzini et al., 2015).
significantly shorter audit delays for firms with strong ICFR than for firms that report
material weaknesses.
end goal to both take care of the issue and maintain a strategic distance from such
occasions later.
Hypothesis development
It is the fact that if interim audit is performs more effetely then the audit on financial
statements by taking help from report of interim audit can reduce the level of audit
delay.