연결재무제표 복잡성이 감사의견 구매행태에 미치는 효과

The scope and the complexity of the firms to be consolidated have increased after K-IFRS adoption compared to K-GAAP period since parent entities should consolidate any investees not by sole ownership but by de facto control assessment. This paper investigates whether the audit opinion shopping behavior of the parent entities can differ by the degree of the complexity of consolidated financial statements. Thus, this paper is to suggest the possibility that the internal control system within the consolidated organization (that is, subsidiaries and parent company) has been improved (or weakened) after the K-IFRS adoption which makes firms to include more subsidiaries in their consolidated financial statements, in general. Particularly, we use the ratio of total assets between separate and consolidated financial statement as a measure of complexity of the consolidated financial statements. Applying the three-step approach by Barron and Kenny(1986), our regression results are as follows: First, we find that the firms’ positive abnormal audit fees show statistically positive association with earnings management. Second, the absolute value of discretionary accruals tends to decrease as the complexity of consolidated financial statement increases. Finally, in the subsample of positive abnormal audit fees, we find the positive association between the two (abnormal audit fees and earnings management) is mitigated in the firms with higher level of complexity in consolidated financial statements. Our findings suggest that the mandatory IFRS adoption strengthen the internal governance control system of the firms with higher level of complexity, minimizing the magnitude of economic bonding between the firms and the auditors through the audit fees.