Japanese companies have reduced the number of days between the date of closing accounting period and the date of releasing annual financial statements. Information technology largely contributes to the reduction of the number of days to prepare and release financial statements. Advocates of prompt preparation of financial statements insist that managers could enjoy significant benefits from it: the timeliness of providing financial outcomes for a certain period enables managers to take a quicker action for the next period in a rotation of the Plan-Do-Check-Act cycle. Acceleration of processing accounting information with information technologies, however, may incur additional costs associated with hardware, software, and staff. Using the data of Japanese firms, this paper examines whether providing financial statements in a timely manner results in better financial performance. The findings of this paper indicate that providing financial statements in a timely manner improves firms’ financial performance.

Keywords: providing financial statements, lead time, financial performance, empirical research,
number of days