• Journal of Distribution Science
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• v.13 no.9
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• pp.95-101
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• 2015

Purpose - This study provides evidence of the impact of the mandatory adoption of Korean equivalents to International Financial Reporting Standards (K-IFRS) on accounting quality. K-IFRS uses fair value as a basis of measurement and is characterized by principle-based standards. These characteristics can lead to a decrease in conservatism. Therefore, this study aims to examine whether or not there is a change in the level of conservatism before and after the enforcement of K-IFRS (2007~2014). By comparing 2007 through 2008 and 2013 through 2014 (excluding 2009 to 2012), we test "the temporary adjustment phenomenon" and document an overall decline in the degree of conservatism after the adoption of K-IFRS. Research design, data, and methodology - Our sample is comprised of data of all listed Korea Composite Stock Price Index (KOSPI) manufacturing distribution companies in Korea from 2007 to 2014, which yields the pooled sample of 4,412 (panel A) and 1,915 (panel B) firm-year observations for hypotheses 1 and 2. In line with recent literature, we adopt the Givoly and Hayn (2000) model, which recomputes the non-operating accruals, excluding two components that are most likely to capture the effect of restructuring activities: special items and gains or losses from discontinued operations. In addition, we also use these variables: SIZE, LEV, INV_CYCLE, ROA, OWN, and FOR. Results - Our sample period spans 2007 to 2014. This offers evidence on the effect of the mandatory adoption of IFRS on conservatism. Our findings can be summarized as follows. First, in panel A, for mandatory K-IFRS adoption (2011), we do not find any significant evidence of conservatism. We can guess that the "temporary adjustment phenomenon" is the reason that we do not find significant evidence of conservatism. Second, we investigate panel B from 2009 to 2012. We document an overall decline in the degree of conservatism after the adoption of K-IFRS. We can assume that these results are due to "the temporary adjustment phenomenon." Conclusions - This study finds that conservatism significantly decreased after IFRS adoption. In particular, this study makes the initial effort to elucidate "the temporary adjustment phenomenon" to analyze the effect of K-IFRS on conservative accounting. We argue that K-IFRS are conceptually conservative but that inappropriate application of the conservatism principles is likely to prevent financial reporting from reaching the level of conservatism targeted by the IASB. Overall, this paper contributes to the literature on IFRS and can be useful to capital market supervisors who are monitoring the trends of the firms implementing K-IFRS. Additionally, our results inform stakeholders of the potentially negative effect of the greater flexibility permitted by IFRS and/or lack of appropriate enforcement on key dimensions of accounting quality. This has important implications for Korean regulators and standard setters as they review the cost and benefits of IFRS. Our study also sheds light on the importance of the institutional environment in achieving the targeted objectives for improving financial reporting quality.

• Korea journal of population studies
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• v.28 no.2
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• pp.63-95
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• 2005

In the era of globalization, a significant number of young students go abroad to learn English. By reviewing the trends and characteristics of this phenomenon, this study will focus on the adjustment of young Korean students in Australia. During June and July 2002, two questionnaire surveys were conducted for year 7 to year 12 Korean students at the Saturday Schools in Sydney Australia and for the youth group at the Sydney Catholic Church. More data was collected from interviews with 31 Korean teachers at the Saturday Schools and Linfield Korean school, as well as observations of the students in the Sydney area. The study divided the students into four groups: 1) Korean immigrant students, whose parents immigrated to Australia; 2) Individual Korean students who went alone to Australia to study; 3) Students whom live in Australia with one parent (usually their mother), whilst the other parent (usually their father) who provides financial support by working in Korea; and 4) students who accompanied their parents whom were dispatched for temporary employment or study in Australia. Moreover the study focused on the following; their academic performance, school activities, motivation, social relations, and their overall satisfaction with their studies and their stay in Australia. The findings indicated that the temporary overseas Korean students, especially those that are not with their parents do not adjust as well as the Korean immigrant students. The students who were not accompanied by their parents to Australia had the most difficulties adjusting as they were more vulnerable and fell behind with their studies. Therefore, the results support the concerns of Korean teachers in Australia about parents sending young students alone abroad.