시장경보지정 기업의 특성에 관한 연구

The market oversight commission of KRX(Korea Exchange) enacted prior warning regulation to monitor unfair trading in 2007. Using a comprehensive sample of Korean listed firms from 2008 through 2012, we investigate characteristics of detected firms by prior warning regulation: characteristics include financial, corporate governance, and accounting quality aspects. The empirical results show that detected firms tend to have high debts ratio, low ROE, high market to book ratio, and large firm beta, suggesting that a firm with higher probability of financial distress, lower profitability, larger difference between market value and book value, and higher risk is likely to be detected by prior warning regulation. In addition, we find that detected firms may have non-Big4 auditor and large discretionary accruals, providing evidence that a firm with higher audit quality and accounting quality is less likely to be detected by the regulation. This study may be the first attempt to investigate characteristics of detected firms by prior warning regulation. The results are likely to be of interest to regulators and investors as evidence is provided on the importance of monitoring firms with characteristics suggested in this study.