Office-Level Characteristics of the Big 4 and Audit Report Timeliness

Posted: 21 May 2013 Last revised: 28 Jul 2023

See all articles by James Whitworth

James Whitworth

University of South Florida

Tamara A. Lambert

Lehigh University

Date Written: February 21, 2013


Timeliness of annual financial reporting information has long been a concern of investors, regulators, financial reporters, and auditors. Recent changes in the audit and financial reporting environment have resulted in longer audit report lags and have increased the importance of identifying factors associated with a timely audit. In this study, we examine the audit timeliness implications of office-specific attributes of the audit firm. Specifically, we examine whether office-specific industry expertise, office size, and the importance of the client to the local office are associated with audit delay (i.e., the time between fiscal year end and the audit report date). In additional analyses we further explore the sensitivity of audit delay to office-specific industry expertise and examine whether the aforementioned audit firm attributes are associated with a propensity to issue an early earnings announcement (which we define as an announcement ten days or more before the audit report date). We find that office-specific industry expertise is negatively associated with audit delay while office size and client importance are both positively associated with audit delay. Office-specific expertise is also positively associated with the propensity to announce earnings substantially early. Finally, we find that office-specific industry expertise garnered via a product specialist strategy (i.e., a small number of large clients within a particular industry) is positively associated with audit delay relative to a low cost specialist strategy (i.e., a large number of smaller clients within the industry). Our study provides further support for the importance of office-specific characteristics on audit and financial reporting outcomes and, more specifically, provides evidence of the benefit of office-specific industry expertise. This research should be of interest to financial reporters, audit firms, and regulators interested in increasing the timeliness/relevance of financial reporting information.

Keywords: audit report lag, office-level auditor attributes, audit report timeliness

Suggested Citation

Whitworth, James and Lambert, Tamara A., Office-Level Characteristics of the Big 4 and Audit Report Timeliness (February 21, 2013). Auditing: A Journal of Practice & Theory, Forthcoming, Available at SSRN: or

James Whitworth (Contact Author)

University of South Florida ( email )

Tampa, FL 33620
United States

Tamara A. Lambert

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

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