상호저축은행의 감사품질이 재량적대손충당금에 미치는 영향

Recently it is raising litigation for accounting firm and it is more strictly require due diligence for outside auditor. In contrast, average audit hour and audit fee are decreasing for during 3 year. It means audit quality can be decline. So, this study investigates audit quality affect earnings management in this situation. More specifically, we examines mutual saving banks which have high audit quality is less earnings management than low audit quality. We uses auditor size(Big4) and auditor change for audit quality the proxy variable of audit quality. The results of this study indicate that the association between the discretionary allowances of bad debts and the audit size(Big 4) and audit change to Big 4 is negative and statistically significant. This implies that high quality auditor can decrease in the discretionary allowances of bad debts. It is consistent with prior research that Big 4 auditor have greater expertise, resources, and more importantly, market-based incentives(e.g., mitigating the risk of litigation and protecting their reputation capital)to constrain the tendency of their audit clients to engage in aggressive reporting or fraud. In addition to this, this result that auditor change to big4 of mutual saving bank decrease earning management supports mandatory auditor rotation and auditor designation system.