Managers’ Annual Report Submission Delays as Predictors of Corporate Default

This study examines whether annual report submission delays (ARSDs) in managers’ earlier entrepreneurial careers can predict corporate default. Using a population of (non-)defaulted Estonian firms, four types of ARSDs are coded according to the severity of noncompliance with legal deadlines. Logistic regression results indicate that the predictive power of ARSDs increases with the severity of the delay, with failure to submit annual reports emerging as the strongest predictor of corporate default. Models based solely on ARSD measures outperform traditional models based on financial ratios in predicting corporate default.