이익조정, 경영전략 그리고 감사위원회의 전문성

This study investigates whether the differential types of audit committee expertise influence the association between the use of prospector strategy and the degree of earnings management. Prior studies which examine the effect of audit committee expertise report that firms with an audit committee with members having accounting expertise restrict firms’ aggressive earnings management. The other line of studies which examine the association between the strategy and the degree of earnings management document that firms using prospector strategy are more likely to manipulate earnings, compared with other firms. By combining these two distinct lines of studies, this paper examines whether the differential types of audit committee expertise - accounting expertise, finance expertise, and supervisory expertise, and their composition - restrict the tendency that the firms using prospector strategy manage earnings. Using data from a sample of listed firms in the Korea Composite Stock Price Index(KOSPI) market which have an audit committee for 2000-2014, we find that firms with finance expertise only (without other expertise) or firms with supervisory expertise only (without other expertise) and adopt prospector strategy manipulate earnings upward. In subsample analysis that restricts the samples that use prospector strategy, we find that the firms having finance expertise only or having both finance and supervisory expertise (but without accounting expertise) manipulate earnings aggressively. These findings provide important policy implications on the effect of audit committee with accounting expertise, and this study contributes in that it considers firms’ strategy when we investigate the influence of audit committee expertise on the earnings management.