Astudy investigated the relationship between audit delay (Delay), thelength of

A
study investigated the relationship between audit delay (Delay), the
length of time from a company’s fiscal year-end to the date of the
auditor’s report, and variables that describe the client and the
auditor. The independent variables are as follows.
Industry
A dummy variable coded 1 if the firm was an industrial company
or 0 if the firm was a bank, savings and loan, or insurance company.
Public
A dummy variable coded 1 if the company was traded on an organized exchange or over the counter; otherwise coded 0.
Quality
A measure of overall quality of internal controls, as judged by
the auditor, on a five-point scale ranging from “virtually none” (1) to
“excellent” (5).
Finished
A measure ranging from 1 to 4, as judged by the auditor, where 1
indicates “all work performed subsequent to year-end” and 4 indicates
“most work performed prior to year-end.”
A sample of 40 companies provided the following data.
Delay
Industry
Public
Quality
Finished
62
0
0
3
1
45
0
1
3
3
54
0
0
2
2
71
0
1
1
2
91
0
0
1
1
62
0
0
4
4
61
0
0
3
2
69
0
1
5
2
80
0
0
1
1
52
0
0
5
3
47
0
0
3
2
65
0
1
2
3
60
0
0
1
3
81
1
0
1
2
73
1
0
2
2
89
1
0
2
1
71
1
0
5
4
76
1
0
2
2
68
1
0
1
2
68
1
0
5
2
86
1
0
2
2
76
1
1
3
1
67
1
0
2
3
57
1
0
4
2
55
1
1
3
2
54
1
0
5
2
69
1
0
3
3
82
1
0
5
1
94
1
0
1
1
74
1
1
5
2
75
1
1
4
3
69
1
0
2
2
71
1
0
4
4
79
1
0
5
2
80
1
0
1
4
91
1
0
4
1
92
1
0
1
4
46
1
1
4
3
72
1
0
5
2
85
1
0
5
1
Enter negative values as negative, if necessary.Develop an estimated regression equation that can be used to predict
Delay by using Industry and Quality (to 2 decimals, if necessary).
Delay =
+
Industry +
Quality
A plot of the residuals as a function of the order in which the data are presented is shown below.
Does this suggest any autocorrelation present in the data?
At the .05 level of significance, test for any positive autocorrelation in the data. dL = dU = The test
inconclusive.

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