• The Journal of Asian Finance, Economics and Business
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• v.8 no.2
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• pp.675-684
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• 2021

This paper aims to analyze factors influencing earnings of workers in Vietnam using provincial-level data from 2016 to 2018. We show the important determinants of earnings of workers of more than 15 years old including working hour, labor force, life expectancy, education, regulation measured by Provincial Competitiveness Index (PCI) and especially Industry 4.0, our major depart from literature proxies by government expenditure on science and technology, number of phone lines, and number of internet users. Working hours are a typical measurement of quantity of labor supplied. Labor force represents market size from the supply side. Life expectancy measures the health of laborers, a physical quality measure of workers. PCI stands for institutional status of the locality. Two most important factors of our interest are education, representing qualification of workers, and Industry 4.0, reflecting the new working environment of workers. By estimating a robust standard error fixed-effect model, we have evidence that all factors are significant in explaining earnings of Vietnamese workers. Education and IR4.0 play an important role in earnings of workers of Vietnam. Results also provide an estimation of Vietnam's labor supply in the context of Industry 4.0. In addition, findings contribute to explain the income discrepancy among Vietnamese provinces.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.2
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• pp.143-150
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• 2021

This study investigates and analyzes the difference in Indonesian banks' earnings quality in the pre-audit and post-audit period. This study also investigates the difference in audit quality done by public accounting firms. This study employs time series data taken from the unaudited and audited financial statements of banks listed on the Indonesia Stock Exchange in 2012-2016. Sample selection is made by using a purposive sampling method. The population of this study is 43 banks, and after checking the data for validity and reliability, the final sample size was 26 banks. Audit quality is operationalized with the size of the auditor. Earnings quality is proxied by accruals calculated using the Beaver and Engel (1996) model. The data analysis method used in this study is the paired-sample t-test and chow test. This study shows that there is no difference in earnings quality in the pre-audit and post-audit period. This study also reveals no difference in audit quality between the big four and non-big four auditors. These findings mean that independent auditors do not play a useful role in increasing the reliability of accounting information presented by management to stakeholders. Besides, this study's results do not verify the agency theory regarding auditors' role to minimize opportunistic management behavior in preparing financial statements.

• Asia-Pacific Journal of Business
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• v.12 no.3
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• pp.343-359
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• 2021

Purpose - The purpose of this paper is to investigate the relationship between earnings management and the disclosure effect of share repurchase. In addition, we analyze whether the relationship between earnings management and share repurchase is affected by executive stock options. Design/methodology/approach - We calculate the discretionary accrual amount for the year immediately preceding the share repurchase and the cumulative excess return around the announcement of the share repurchase, and examine the relationship between the two by regression analysis. Findings - We confirmed a negative relationship between discretionary accrual in the year immediately preceding the share repurchase and the market response to the share repurchase disclosure. In particular, it was found that the negative relationship between discretionary accrual and stock price return on share repurchase announcement was found to decrease in companies to which executive stock options were granted. Research implications or Originality - When uncertainties exist in the motives for share repurchase, we find that earnings management and executive stock options can be useful tools for reducing the adverse selection risk inherent in share repurchase announcements.

• Journal of Distribution Science
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• v.21 no.6
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• pp.99-106
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• 2023

Purpose: This study aims to analyze the distribution of the role of adversity quotient in the estimation bias of future earnings. Adversity quotient is a cognitive ability that can be distributed as a reducer of bias effects that occur in profit forecasting or investment decision making. Research design, data and methodology: The study designs a full factorial within-subject 2×3 as a laboratory experiment. The study subjects are 30 accounting students who are proxied as investors. Results: The results show that the estimated earnings made by investors experience anchoring-adjustment heuristic bias which means the initial value becomes a basic belief that influences the decisions taken by investors. However, this study also provides evidence that heuristic bias can be reduced by the presence of adversity quotient. Investors who have high adversity ability are abler to reduce the estimation bias when compared to investors who have medium and low adversity ability so the higher the difficulty ability possessed by investors, the less likely the occurrence of bias in decision making. Conclusion: Thus, the adversity quotient is proven to be distributed as a reducing opportunity from the bias that will occur in estimating future earnings or making investment decisions.

• Journal of Distribution Science
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• v.20 no.4
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• pp.95-100
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• 2022

Purpose: This study aimed to investigate whether distribution and service companies maintained their accounting information quality and provided reliable information despite the economic changes occurring after the outbreak of the COVID-19 pandemic in Korea. The distribution industry has enjoyed increased demand as many companies expanded their untact distribution channels, including to online sales. However, as the pandemic drags on, their future prospects remain uncertain. Research design, data, and methodology: In this study, we define 2018-2019 as the "pre COVID-19 period" and 2020 as the "post COVID-19 period." An empirical analysis was performed using a regression model that includes POST, the independent variable, indicating the post COVID-19 period, and discretionary accruals(DA), a proxy for earnings management, as a dependent variable. Results: The analysis shows that the coefficient of POST is significantly positive (+) for the dependent variable DA. This finding suggests that distribution and service companies engaged in more earnings management during the post COVID-19 period than during the pre COVID-19 period, indicating their awareness of the uncertainty of future business performance as the pandemic persists. An additional analysis confirmed that smaller companies with fewer stakeholders and higher information asymmetry tend to engage more in earnings management than larger companies.

• Journal of Korean Institute of Industrial Engineers
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• v.4 no.1
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• pp.57-63
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• 1978

Hourly earnings of the employed U. S. women are regressed upon a set of independent variables, separately for white and nonwhite women. In support of the human capitalist's point of view higher hourly earnings are positively associated with number of years of education completed, attainment of vocational training either at the company or/and non company training. In addition to education one's obtainments of certain occupational certificate and one's assignment of occupation in the order of the Duncan prestige index and years of work experience since leaving school are also significantly related to hourly earnings. Women workers employed at the government sector or employed in an industry where proportion of female is smaller than average earn more than those at private sector or at industries of high female composition.

• Korean Journal of Social Welfare
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• v.64 no.2
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• pp.55-83
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• 2012

Self-employment rate is high in Korean labor market, while the income gap within self-employed is also high. Although, there are very few studies that addressed on the income inequality of self-employed. Thus, this study has measured the earnings inequality of self-employed by generalized entropy indices and decomposed inequality factor and trend. The empirical study is based on Korea Welfare Panel Study wave 1~4. The main result from this analysis is summarized in three points. Firstly, earnings inequality of self-employed is severely high and the earnings polarization within self-employed has become more serious in Korea. Secondly, this study provides the evidence that the main factor of earnings inequality of self-employed is the status of self-employment, education level, age group, workplace scale and industry. Thirdly, the contribution of relative changes in the incomes of the status of self-employment is the largest to the inequality trend. In terms of education level, age group and industry, the increase of inequality within group(pure effect) mainly attributes to the rise of earnings inequality of self-employed and the change effect of group composition contributes to deterioration of inequality.

• Journal of the Korean Operations Research and Management Science Society
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• v.28 no.3
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• pp.81-101
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• 2003

The financial statements purpose to provide useful information to decision-making process of business managers. The value-relevant information, however, embedded in the financial statement has been often overlooked in Korea. In fact, the financial statements in Korea have been utilized for nothing but account reports to Security Supervision Boards (SSB). The objective of this study is to develop earnings forecasting models through financial statement analysis using artificial intelligence (AI). AI methods are employed in forecasting earnings: artificial neural networks (ANN) for manufacturing industry and case~based reasoning (CBR) for banking industry. The experimental results using such AI methods are as follows. Using ANN for manufacturing industry records 63.2% of hit ratio for out-of-sample, which outperforms the logistic regression by around 4%. The experiment through CBR for banking industry shows 65.0% of hit ratio that beats the statistical method by 13.2% in holdout sample. Finally, the prediction results for manufacturing industry are validated through monitoring the shift in cumulative returns of portfolios based on the earning prediction. The portfolio with the firms whose earnings are predicted to increase is designated as best portfolio and the portfolio with the earnings-decreasing firms as worst portfolio. The difference between two portfolios is about 3% of cumulative abnormal return on average. Consequently, this result showed that the financial statements in Korea contain the value-relevant information that is not reflected in stock prices.

• The Journal of Industrial Distribution & Business
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• v.11 no.4
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• pp.39-46
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• 2020

Purpose: This study looks at the relevance between discretionary revenue and book-tax differences (hereafter BTDs). While the study of earnings management, which focused on discretionary accruals and real earnings management, has largely made, it has not yet been actively researched on discretionary revenues. Therefore, it was believed that discretionary revenue would expand the preceding study by looking at its relevance to BTD, known as financial reporting quality and measures of tax avoidance. In general, prior research suggested that earnings management make BTDs larger. Thus, the relationship between discretionary revenue and the amount of BTD is predicted positive. Research design, data and methodology: To this end, the method of discretionary revenues was used and BTDs measured in four ways. First, Earnings before income tax - estimated taxable income divided by total asset (BTD). Second is fractional rank variable of BTDs (FBTD). Third is Indicator variable equals 1 if the firm-year has a positive BTD, 0 otherwise (PBTD). Fourth is that Indicator variable equals 1 if the firm-year has a BTDs in top(bottom) quartile, 0 otherwise (LPBTD, LNBTD). 4,251 samples were analyzed in the Korean Security market (KOSPI) from 2003 to 2014. Results Empirical analysis shows that BTDs increases as discretionary revenue increases. These results were equally observed when BTDs was measured as a ranking variable or as a indicating variable. These results indicate that earnings management through the revenue of managers exacerbate the quality of financial reporting. Conclusions: In sum, discretionary revenues can be used as an indicator of making BTDs larger and meaningful as the first study of the Korean capital market where discretionary revenues affect accounting information quality. Investors need to increase interest in discretionary revenues because intervention in financial reporting through revenue accounts by managers can increase information asymmetry and agency costs. This means that studies on discretionary revenues that have been relatively small should be expanded. The results also provide important implications for the relevant authorities and investors. Despite these benefits, however, measurement error problems with estimates still appear as limited points, and prudent interpretations are required, and additional follow-up studies are needed in that variables that are not yet considered in this study may affect our findings.

• Journal of the Korea Convergence Society
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• v.10 no.12
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• pp.299-305
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• 2019

This study analyzed the relationship between the debt ratios of Korean and Japanese manufacturing firms with accruals and actual earnings managements after the global financial crisis. This study was conducted on Korean and Japanese firms from 2008 to 2015. As a result, the Korean firms, the higher (lower) debt ratio is, more up(down)side earnings management using discretionary accruals and operating cash flow. In contrast, the Japanese firms found that the higher(lower) the debt ratio is, more up(down)side through its actual activities (operating cash flows, manufacturing costs, discretionary costs) rather than accruals. This study establishes the academic basis for the decision-making of Korean-Japanese firmss by using the sample of each country to check what kind of decision-makers are making earnings managements at the present time when the relationship between Korea and Japan has suffered due to export restrictions. It is meaningful in that it was.