지방공기업의 경영평가와 경영자 보상이 이익조정에 미치는 영향 - 지방공사를 중심으로

This study examines the relationship between management evaluation and compensation and earnings management using a sample of 371 local public enterprises from 2012 to 2018. Management evaluation of local public enterprises can influence on CEO’s reappointment, dismissal, incentive compensation, and even administrative measures for institutional closure. Thus, CEOs of local public enterprises may be conscious of the management evaluation, and have an incentive to increase incentive compensation through earnings management according to expected management evaluation grade. We find that each management evaluation and CEO’s compensation has a positive relationship with earnings management of local public enterprises, which implies that CEOs of local public enterprises have incentives to manage earnings to increase the management evaluation grade and compensation. Also, this positive relationship decreases according to increase in the management evaluation grade, which indicates that the earnings management incentive of CEOs can be different according to the management evaluation grade. This study is important in that expanding the research of local public enterprises to empirical research using financial information, and showing that CEOs’ earnings management incentives can be different depending on management evaluation grade.