직급별 감사시간이 영업권 손상 관련 재량적 의사결정에 미치는 영향

The amendment to the Act on External Audit of Stock Companies(referred to herein as the “Act”), which requires an auditor to attach to an audit report, documents starting details of the external audit conducted, such as the number of persons who have participated in the external audit, the details of the audit, and the required time, had become effective in May, 2014. It is required to disclose the audit hours for five different rank: director, registered accountant, associate accountant, expert in other areas such as tax, IT audit, and asset valuation, and audit quality reviewer. Audit efforts, proxied by audit hours, may be different depending on the auditors experience, expertise, rank, etc. of the auditors participated in the external audit. Under the impairment-only approach, the recognition and measurement of goodwill impairment can be based on a high degree of subjectivity and greater managerial discretion. Therefore, the role of external auditor is important to increase the reliability of goodwill impairment tests and limit the opportunistic earnings management with respect to timing and magnitude of goodwill impairments. This study investigates the effect of rank-specific audit hours on goodwill impairment. The empirical results show that an increase in audit hours of director, registered accountant, and audit quality reviewer is positively associated with goodwill impairment. However, an increase in audit hours of all ranks is not significantly associated with the magnitude of goodwill impairment. The findings of this study shed light on how audit efforts by each rank work differently when assessing the timeliness and magnitude of goodwill impairment.