Does audit report readability influence audit report delay? The moderating role of the audit firm

Purpose Drawing on communication theory, this study investigates the impact of audit report readability (ARR) on the audit report delay (ARD) of non-financial companies listed on the Palestine Exchange (PEX). The study also examines whether audit firm (AF) moderates the relationship between the readability of the audit report and the delay in the submission of the audit report. Design/methodology/approach This study is based on pooled data and contains 176 observations from non-financial companies listed on the PEX for the period 2016–2023. The hypotheses are tested using multivariate regression based on random effects. Findings The results show that the readability of the audit reports is positively and significantly correlated with the long delays in the submission of the audit reports. This delay in the audit report may be due to the need for greater detail and clarification as well as the longer treatment of complex concepts and sentences. The results also indicate that AF negatively moderates the link between the ARR and ARD, indicating that the appointment of the big four AFs weakens the link between ARR and ARD. Originality/value To the best of the author’s knowledge, this study is the first to address this issue in Palestine and other emerging markets. This study therefore fills a major gap in the emerging market literature and provides valuable insight into international audit practice by examining how ARR influences the timeliness of the audit report and how AF moderates this relationship.