증권관련집단소송의 확대시행과 재무보고의 적시성

The full enforcement of Korean Securities Class Action in 2007 may well increase the legal exposure of the incumbent corporate managers and external auditors. The incremental legal risk could give them a motive to control up the accounting and auditing quality, which can widen the audit and reporting lag and thus have the negative effect on the timeliness of financial reporting. The purposes of this study is to study the possible adverse relationships between the increased regal risk due to the 2007 full enforcement of the securities class action privileges and the financial reporting lag of Korean companies. 1,322 company-year samples are consisted of 2005 and 2006 accounting years of 661 Korean listed companies. Two main hypotheses are derived to capture the differences of audit and report lag of the incumbent enforced companies between the year 2004 and 2005(the year effect) and the differences between the KSE and KOSDAQ listed companies(the market effect). Two types of multi-variate regression model(Simple and Extended Model) are formulated to test the hypotheses. The timeliness proxies, Audit and Report lag, can be explained by two research variables(Accounting Year, Stock Market), and by the interaction term of these two, under the control of many extraneous variables. The analysis of Simple Model of auditing lag, of which the explanatory variables are Accounting Year, Stock Market, and the interaction term, showed low adjusted R2 and thus weak explanatory power of model. But the adjusted R2 of Extended Model of audit lag, which extend Simple Model to include many control variables, increased up to .30. But the report lag model showed very low R2 Adjusted throughout the models. The Accounting Year showed the significant (+) effect as expected on the audit lag in both Simple and Extended Model. It implies the full enforcement of Securities Class Action in 2007 and the incremental legal risk thereof possibly widened the audit report lag and lowered the timeliness of financial reporting. But, in the report lag model, the Accounting Year showed no consistent results. The Stock Market also showed the significant and expected (-) effect on both the audit lag and report lag regardless of Simple or Extended model, which means the KOSDAQ listed companies are more sensitive to the legal risk related to the accounting malpractices and thus showed greater audit and report lag, that is lower timeliness of financial reporting, than the KSE listed companies. The Accounting Year and Stock Market in the Simple Model showed the (+), and significant in the report lag analysis, interaction effect on both the audit and report lag, which is contrary to expectation though and implies that the KSE listed companies were more sensitive to the heightened legal exposure by the Securities Class Action and take more accounting and auditing time than the KOSDAQ companies.