Chinese Accounting Restatement and the Timeliness of Annual Report

38 Pages Posted: 4 Apr 2013

See all articles by Chen Ma

Chen Ma

Northwest University

Junrui Zhang

Xi'an Jiaotong University (XJTU)

Hui Du

University of Houston, Clear Lake

Date Written: April 3, 2013

Abstract

Chinese accounting restatements are mainly disclosed in companies’ annual reports due to unique Chinese institutional background and regulatory setting. Using manually collected data of 1050 accounting restatements from 2003 to 2011, we study the association between Chinese accounting restatement and the timeliness of annual report. The results from our difference-in-difference research design indicate that with an accounting restatement, a company takes longer to file its annual reports in the post-restatement period than in the pre-restatement period, suggesting a negative association between Chinese accounting restatements and timeliness of annual reports. When further examining the association between various restatement characteristics and timeliness of annual reports, we find an overall negative association between restatement severity and the timeliness of annual reports. We contribute to the existing accounting restatement literature from international perspective with evidence that restatements delay the timeliness of financial reporting.

Keywords: accounting restatement, timeliness of annual report, disclosure

JEL Classification: M4

Suggested Citation

Ma, Chen and Zhang, Junrui and Du, Hui, Chinese Accounting Restatement and the Timeliness of Annual Report (April 3, 2013). Available at SSRN: https://ssrn.com/abstract=2244655 or http://dx.doi.org/10.2139/ssrn.2244655

Chen Ma (Contact Author)

Northwest University

Xian, Shaanxi 029
China

Junrui Zhang

Xi'an Jiaotong University (XJTU) ( email )

26 Xianning W Rd.
Xi'an Jiao Tong University
Xi'an, Shaanxi 710049
China

Hui Du

University of Houston, Clear Lake ( email )

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