• Asia-Pacific Journal of Business
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• v.14 no.3
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• pp.167-186
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• 2023

Purpose - The purpose of this study is to empirically investigate whether the auditor accreditation system for IPO firms improves the efficiency of the KOSDAQ IPO market. To verify the effectiveness of the auditor designation system, we time series compare four measures of IPO firms (earnings management, long-term stock performance, change in operating performance, and possibility of delisting). Design/methodology/approach - We test the hypothesis through event research method and regression analysis. Specifically, the dependent variables of the regression model are discretionary accruals in the year of IPO, 36-month holding period excess return after IPO, change in operating performance for 3 years after IPO, and dummy variable for delisting. And the explanatory variable is a dummy variable that separates the period before and after the implementation of the auditor designation system. Findings - We find that earnings management and delisting risks decreased more in the period after the implementation of the auditor accreditation system than in the previous period. In addition, we find that long-term stock performance and operating performance after IPO increase further after the implementation of the auditor accreditation system. Research implications or Originality - Overall, the results of this study suggest that the implementation of the auditor accreditation system for IPO firms contributes to improving market efficiency in the KOSDAQ market, where information asymmetry is high. Our study differs from previous studies in that it demonstrates the effectiveness of the auditor designation system using various measures.

• Journal of Industrial Convergence
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• v.21 no.4
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• pp.65-72
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• 2023

This study's purpose is to verify how the periodically designated auditor in the recently implemented periodic auditor designation system affects audit quality. In this study, hypotheses were established by reviewing previous studies, and 980 samples of 2019 and 2020 were selected for KOSPI-listed companies. Dechow & Dichev (2002)'s accrual quality was used as the dependent variable, and the effect of whether or not a company was periodically designated as an auditor and whether or not a Big 4 auditor was selected was empirically analyzed. As a result of the analysis and correlation analysis, a statistically significant difference was confirmed in the quality of the dependent variable accrual and the independent variable designated auditor (PA). However, as a result of the regression analysis model 1, it was found that the designated auditor was not significant, but it was confirmed that there was a significant difference in the control variables. Further analysis confirmed the difference in audit quality according to the Big 4 auditors. This study is significant in that it is a study that uses empirical data to study the effect of audit quality and the selection of regularly designated auditor companies after the introduction in 2019 and 2020. Due to the non-disclosure of government-designated companies, there is a limit that there may be a difference from the selection based on the researcher's published selection criteria.

• The Journal of the Convergence on Culture Technology
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• v.7 no.4
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• pp.479-490
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• 2021

As a part of Korean accounting reforms through the improvement of the accounting and audit related systems, the amendment bill of 'Act on External Audit of Stock Compamies's was passed in the Natinal Assembly plenary session in 2017, the amended act has been enforced except some regulations since the business year on November 1, 2018, and all the amended matters will be applied from the business year of 2024. The reasons for auditor designation in 2019 are 'pre-IPO' 331 companies, 220 periodic designation companies, 197 companies that had operating loss for three consecutive years, 112 companies with issues for administration, 108 companies with excessive debt ratio and 66 companies with no auditors. Regarding the reasons for the increase of auditor designation, 475 companies were increased in accordance with the new designation standard by the amended bill of Act on External Audit of Stock Companies, 114 companies were increased due to the abolition of the considered designation system of companies to be listed, and 90 companies were increased based on the increase of listed companies incorporated to issues for administration. In 2020, 462 companies had periodical designation (434 listed, 28 non-listed), adding 242 companies (110%) over a year. In terms of direct designation, 'pre-IPO' accounted for the most (362 companies), followed by '3 consecutive years of operating loss' (245 companies), then by companies with administration issues (133 companies), and CEO & largest sharholder replacement. Regarding the designation of auditors according to accounting firms in 2020, A group that includes(top 4) accounting firms(Samil, Samjeong, Hanyeong, Anjin) had 526 companies(34.6%), which ia an incease of 72 companies from the previous year(454 companies, 37.1%), but the weight decreased by 2.5%.

• Journal of Digital Convergence
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• v.17 no.9
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• pp.507-516
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• 2019

The purpose of this study is to propose a policy for accounting practice education system to improve the national credibility. The biggest reason why the national credibility is the lowest is that the auditor's free appointment system is the next, and the education on accounting is not done properly. This study is a bibliographical study that examines the previous studies on the improvement of accounting audit and accounting education in Korea, various public hearings, press releases, and government policy data, and summarizes. The way to increase accounting transparency is to improve the audit system and to guarantee accounting practice education. Since the subjects of practical education belong to all areas such as private and government, it is intended to propose the establishment of accounting professional education institution, called (tentatively) 'Accounting Training Institute'. Through this, it is expected that the practical and professional training will improve accounting transparency and contribute to the improvement of national credibility.