• Journal of Digital Convergence
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• v.15 no.11
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• pp.167-174
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• 2017

These days, people distrust the accounting transparency of firms in Korea. It can .increase the capital costs and reduce profitability of firms. Auditors say that one of causes on the low grades of the accounting transparency is free contracts between auditors and firms. Firms want auditors take low audit fees. In principle, if auditors take low audit fees, they cannot input auditor resources to proper audit. However, there are not any empirical evidence about the relation between the audit fees dumping and the audit quality. This study defines dumping auditors if their audit fees are lower than the average of industries, and examines whether these auditors showed low audit qualities or not. As a result, firms which are audited by dumping auditors presented low abnormal accruals. We can interpret this result as that dumping auditors have low audit qualities. This result helps to make policies to improve the accounting transparency of firms.

• Management & Information Systems Review
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• v.35 no.3
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• pp.231-247
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• 2016

This study, according to the amendment of the Act on External Audit, on the basis of the number of input auditors, the content of auditing, and audit times as additional informations, calculates the average of the samples listed companies with assets of one hundred billion KRW. However, since the actual number of the subject corporations of which asset is 100 billion KRW is small, it is difficult to extract data with reference to this asset size. Therefore, the samples were extended to 50 corporations of which asset is 10% less than 100 billion KRW and other 50 more corporations of which asset is 10% more than 100 billion KRW. As a result, a total of 100 corporations were included as samples. To calculate the average of the audit times, a t-test was performed between the two groups. The result of the t-test showed that there is not a significant difference between the two groups. According to the analytical results of the t-test, the average of the number of input auditors and the average of audit times were calculated with respect to all the 100 samples. A further analysis showed that the average of audit content in the present study was compared with the estimated values in the study of Mun (2016). Although the results of this study may not be the optimal number, they may be used as a fundamental index which may be compared with the audit times and the audit fees in the current audit market where there is not an available reference. In addition, the amendment of the Act on External Audit may enhance the independence of auditors and the transparency of accounting system when compared with the previous system where only the total audit times were disclosed.

• Journal of the Korea Convergence Society
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• v.13 no.4
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• pp.321-329
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• 2022

This study analyzes how companies of prospector type with inherent risks from new products and R&D costs affect audit hours, and further analyzes how they affect rank-specific audit hours. Samples were empirically analyzed using samples from 2018 to 2019 for KOSPI-listed and KOSDAQ-listed companies. As a result of the analysis, first, it was found that auditors were aware of the inherent risks of companies of prospector type and were striving to improve audit quality. Second, it was found that the corresponding degree of risk differs depending on the position and role in the audit team, so higher efforts were made in core positions with high risk levels. The results of this study are meaningful in verifying how the type of Business Strategies affects the audit efforts and resource input of auditors who are external parties, not internal factors such as financial reporting quality or tax avoidance. It also has important implications that a company's Business Strategies can be an significant factor to consider in preparing policies and systems for improving audit quality.