• The Journal of the Korea Contents Association
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• v.14 no.6
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• pp.367-384
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• 2014

This study addresses an empirical issue which has been received little attention in the contemporary finance literature: To identify any financial determinants of the profitability indices for the firms belonging to the Korean chaebol. Three hypotheses of concern were postulated and tested for the sample firms covering the periods of the pre-and post-financial global crises. Regarding the results on the 1st hypothesis test of characterizing any financial profiles for the firms (belonging to the chaebols) by estimating a legitimate panel data model: the present study found the statistically significant relationships of the explanatory variables (BVLEVl, MVLEVl, MV/BV, RISK, FCFF and FOS) with the book-value based profitability ratio: while the market-valued profitability index was explained only by BVLEV2. Regarding the 2nd hypothesis test for the profitability of the sample firms at the industry level: the chaebol firms in the chemical and the food industries overall positioned themselves into the top ranks in order, which was tested by the ANCOVA and the Tukey multiple comparison procedure. Finally: on the 3rd hypothesis test for the 'adjusted' Dupont system, only two such as the 'operating margin' and the 'asset turnover' showed their significant effects between the chaebol firms and their counterparts in both the (parametric) independent samples t-test and the (nonparametric) Wilcoxon-Mann-Whitney statistics.

• Management & Information Systems Review
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• v.34 no.2
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• pp.113-130
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• 2015

This study considers the relation between firms' earnings management and credit rating. Unlike preceding papers only focusing earnings management by accrual(thereafter, AM), this paper examines the effect of accrual earnings management(AMs) and real earning management(thereafter, RM) on credit rating. RMs have more negative effects on firms' forward cash flow generation abilities and long term operating performances than AMs. So, RMs are more negative signals for credit analysts than AMs. But credit analysts have much difficulty in seeing through RM, because if credit analysts want to find out RMs, they have to understand firms' internal operating activities, cost structures, receivables collection practices, and review whether profit distortions are due to abnormal change of them. Sample of this study consists of 2,150firm-year data listed companies from 2002 to 2010. Empirical evidence shows that AMs and RMs are negatively related to credit rating. This result implies that credit analysts see through AMs and RMs in interpreting financial informations, that is to say, they discount credit rating in considering level of earnings management that consist of real activity and accrual earning management. This paper also finds that RMs are more negatively related to credit ratings than AMs. This result suggests that credit analysts don't take RMs into account in credit rating process as much as AMs.

• Journal of Digital Convergence
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• v.15 no.2
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• pp.121-133
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• 2017

The propose of study is to examine the characteristics of companies with high possibility to form an internal control weakness using forecasting model. This study use the actual listed/unlisted companies' data from K_financial institution. The first conclusion is that discriminant model is more valid than logit model to predict internal control weak companies. A discriminant model for predicting the vulnerability of internal control has high classification accuracy and has low the Type II error that is incorrectly classifying vulnerable companies to normal companies. The second conclusion is that the characteristic of weak internal control companies have a low credit rating, low asset soundness assessment, high delinquency rates, lower operating cash flow, high debt ratios, and minus operating profit to the net sales ratio. As not only a case of listed companies but unlisted companies which did not occur in previous studies are extended in this study, research results including the forecasting model can be used as a predictive tool of financial institutions predicting companies with high potential internal control weakness to prevent asset losses.

• Journal of the Korea Society of Computer and Information
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• v.25 no.2
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• pp.221-229
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• 2020

As the cosmetics beauty industry grows into a key next-generation industry, the establishment of an industrialization center is needed, but failure to verify the adequacy and feasibility of the investment could lead to financial burdens. In this study, the project costs and facilities of an industrial center are reviewed to analyze its economic feasibility based on the cost estimates, revenue estimates, estimated profit or loss calculations, and estimated operating cash flows. The profit estimation criteria were analyzed by applying 90 per cent of expected orders for research projects (24 billion won) and 12 per cent of rental rates for testing equipment (4.5 billion won for construction), and the benefit/cost ratio is higher than 1.02 per cent and the net present value is higher than '0' won, and the internal rate of return is also more than 5.06 per cent for all three analytical methods. Therefore, in order for the construction of a cosmetics beauty industrialization center to be economically feasible, it is necessary to maintain research project orders of more than 90 percent and return on equipment rent of more than 12 percent, and a strategic approach is needed to diversify business profits.

• The Journal of the Korea Contents Association
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• v.13 no.11
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• pp.829-844
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• 2013

This study performed comprehensive tests on the four hypotheses on the capital structures for the firms listed in the KOSPI during the period from 2006 to 2011. It may be of concern to find any financial profiles on firms' leverage across the book- and market-value bases since there was relatively little attention drawn to any financial changing profile of the leverage surrounding the period of the pre-and the post-global financial crises. The findings of this study may also be compared with those of the previous related literature, by which it may be expected to enhance the robustness and consistency of the results across the different classifications on capital markets. It was found that three explanatory variables such as PFT, SIZE, and RISK, were found to be the statistically significant attributes on leverage during the tested period. Moreover, the outcome by the Fisher Exact test showed that a firm belonging to each corresponding industry may possess its reversion tendency towards the industry mean and median leverage ratios.

• Korean journal of communication and information
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• v.46
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• pp.387-419
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• 2009

The concept of strategic group is defined as an aggregate of corporations utilizing similar strategies with similar resources. It becomes a kinds of contact point in the middle of corporation and industry between the industrial organization theory and the strategic management theory. This study tried to apply the strategic group model, which has been a main theory in the management studies, to program providing industry in Korea. This study shed lights upon research problems such as number of strategic groups, differences of strategic variables among the groups, finally differential performances according to strategic groups. 40 commercial broadcasting companies were analyzed to find answers. 9 strategic groups were drawn as a result of cluster analysis. Major variables which contribute to making groups were operating efficiency(4.05), pricing(3.83), size(number of system operator, 3.56), reliance on license revenue(2.58), horizontal integration(number of sister networks, 2.16) in order. An analysis of variance between performance variables has shown statistical significance regarding total net revenue per subscriber, however, insignificances statistically in regards to ratio of operating profit to net sales, cash Abstracts 687 flow ratio. Some studies in the past insisted that history variable played an important role to classifying strategic groups. However, this study found that the history didn't exert significant influence on either the group classification itself or performance.

• Management & Information Systems Review
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• v.31 no.4
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• pp.33-56
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• 2012

The purposes of this paper are analysed the relationship between environmental regulation and financial performance in Korea. The financial performance of listed companies and Outside Auditing firms was evaluated by logistic regression. First, R&D investment is proportionally correlated with the ability to comply with environmental regulations. It can be explained increase of investment in R&D causes enhancement of compliance of environmental regulations with development of environmental technology. Second, statistical significance is not observed between financial aspects such as current ratio, debt-to-equity ratio, cash flow, and operating profit margin and the ability to comply with environmental regulations. It indicates high financial performance could not directly lead investment for the ability of that. Third, in terms of structural aspects, firm size and employees have a reliable correlation with compliance with environmental regulations due to high attention of larger firms for PR, and IR, while capital intensity and gravity, and exports do not. Finally, violation of environmental regulations is not affect by the controlling shareholder ownership.

• Journal of Navigation and Port Research
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• v.43 no.4
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• pp.264-272
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• 2019

In this study, the rate of return on investment used as a proxy variable for the entity's value and financial structure (liability ratio) is related to positive balance. This is consistent with the Static Tradeoff Theory (STT) that the entity's value and financial structure are related to a positive balance because the capital expense of a debt (tax-saving effects) that is less than its equity cost before it is in financial difficulty. Also, operating profitability (EBITDA/Sales), investment safety, total asset growth, net working capital and depreciation expenses are related to negative (-) with financial structure (liability ratio). This is the result of an analysis consistent with the Pecking Order Theory (POT). Fuel costs, borrowing, total asset turnover, financial costs, and tangible asset ratios have a significant positive relationship with the debt ratio. This is consistent with the agency theory and confirms that excessive chartering expenses, such as the bankrupt H company, are the main factors that pressure the financial structure of Korean ocean carriers.