회계제도개선과 감사품질이 재량적 발생의 크기와 정보성에 미치는 영향 = The Effect of Reform of Accounting Systems and Audit Quality on the Level and Informativeness of Discretionary Accruals

다국어 초록 (Multilingual Abstract)

Korean government has initiated a series of reform of accounting systems to improve corporate transparency and reliability of accounting information aftermath the economic crisis. This paper investigates into the effect of such reform of systems and audit quality on the level and informativeness of discretionary accruals. For this study, I formulated several research hypotheses concerning the association between the reform of accounting systems and audit quality and discretionary accruals, and then tested them through both univariate and multivariate analyses. In order to test the hypotheses concerning the association between the reform of accounting systems and audit quality and the level of discretionary accruals, regression models have been established. The dependent variable of the models has been defined as two ways: current and total discretionary accruals amount annually and cross-sectionally computed using the modified Jones models. The independent variables include audit quality, the reform of accounting systems and their interaction effects as experiment variables and other control variables. Audit quality has been proxied by auditor size and reputation(Big5 vs. Non-Big5 auditors), and the reform of accounting systems has been classified by the period(1995-1997 vs. 2000-2002). In order to test the hypotheses concerning the association between the reform of accounting systems and audit quality and the informativeness of discretionary accruals, regression models have been established utilizing Subramanyam(1996) model. The dependent variable of the models has been defined as two ways: stock returns and future profitability. Stock returns are cumulated annual returns and future profitability is proxied by both future accounting income and cash flows. The independent models include the components of accounting income, cash flows from operation, discretionary accrual, non-discretionary accruals and interaction effects between them and the reform of accounting systems and audit quality. This study reports the following empirical evidence. First, the level of discretionary accruals reported by the sample firms has remarkably decreased after the economic crisis. However, there is no difference in the amount between discretionary accruals reported by the clients of Big5 auditors and that reported by the clients of Non-Big5 auditors, and this no differentiation of audit quality between Big5 and Non-Big5 auditors has not been influenced by the reform of accounting systems. This evidence implies that even though earning quality has increased, audit quality still has not been differentiated between the Big5 and Non-Big5 auditors even after the reform of accounting systems. Secondly, the association between discretionary accruals and stock returns and future profitability has decreased after the reform of accounting systems. This results are contradictory to the prediction that the enhancement of informativeness of accounting income would be brought by conservative accounting reported after the reform of accounting systems. Thirdly, it has been found that audit quality does not affect the association between discretionary accruals and stock returns and future profitability and hence audit quality has not influenced the informativeness of discretionary accruals. This results might imply that in Korean audit market, unlike foreign countries there is no difference in audit service quality between the Big5 and Non-Big5 audit firms yet and several audit policies implemented to promote audit quality of external auditors have not been effective.