금융자산 실사 횟수가 이익조정 억제에 미치는 영향에 관한 실증연구

[Purpose] This study verifies whether the number of due diligence on financial assets among external audits recorded since 2014 has information effect as a detailed proxy for audit quality that restrains earnings management. [Methodology] Our sample consists of non－financial firms listed in KOSPI from 2014 to 2017, a total of 2,473 firm－year observations. This research analyses the effect of due diligence on financial assets on discretionary accruals and verifies the impact of the attendance inspection on the suppression of earnings management using regression analysis. [Findings] Followings are the findings of this study. First, the number of due diligence on financial assets represents a significant negative relationship with discretionary accruals, a proxy for earnings management. Second, the effect of restraining earnings management in the number of the attendance inspection shows that it serves as an audit quality when the number is more than two days compared to less than two days. [Policy Implications] In this study, we find a significant relationship between due diligence on financial assets of the external audit’s performance and audit quality that restrains earnings management. It also suggests whether the number of the attendance inspection is effective as a proxy for audit quality, indicating that such detailed disclosure has an institutional effecting on improving audit quality. This study has policy implications by providing a basis for judgment of decision making and policy making related to the disclosure of external audits.