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http://dx.doi.org/10.15207/JKCS.2020.11.12.243

The Impact of Governance Structure on the Relationship between Report Types of Weakness in Internal Accounting Control System and Executive Compensation  

Jung, Woo-Sung (School of Business Administration, Busan University of Foreign Studies)
Publication Information
Journal of the Korea Convergence Society / v.11, no.12, 2020 , pp. 243-251 More about this Journal
Abstract
The purpose of the study is to explore the relationship between the type of reporting weaknesses in the Internal Accounting Control System and executive compensation, and then analyze whether such relevance varies depending on the characteristics of governance structure. The analysis data used 6,343 KOSPI&KOSDAQ companies excluding the financial industry from 2011 to 2016. As a results of the study, First, executive compensation decreased in companies reporting the weaknesses of CL. Second, this relevance was further strengthened according to the governance structure. This study confirms that information on the operation results of system is an important factor in determining manager compensation. It implies that it is necessary to study reasonable compensation policies and governance structures suitable for companies. If an internal control system that affects executive compensation is added, the basis for stronger support of the research results can be prepared.
Keywords
Internal Accounting Control System; Company Level Weakness; Executive compensation; Penalty; Governance structure;
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Times Cited By KSCI : 4  (Citation Analysis)
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