사업보고서 가독성과 주가붕괴위험

[Purpose]This study investigates the relationship between the readability of annual reports and stock price crash risk, as well as how the managerial entrenchment factors affect this relationship.For companies where managers have both the willingness and the capability to attenuate information asymmetry, the likelihood of a stock price crash is expected to be lower. [Methodology]This study applies the OLS method using the readability of annual reports as a proxy for managerial intent to mitigate information asymmetry, and the entrenchment index as a proxy for managerial power. [Findings]The main findings are as follows：First, companies with less readable annual report tend to have higher stock price crash risk, suggesting that low readability may signal managerial opportunism. Second, the negative relationship between annual report readability and stock price crash risk is more pronounced in companies with stronger managerial entrenchment mechanisms, indicating that companies with high information asymmetry incentives and strong managerial power are more prone to opportunistic behavior in preparing annual reports. [Implications]This study provides a more detailed explanation of the pathway through which the readability of annual reports affects stock price crash risk, by introducing the managerial power as a mediating variable that has been largely overlooked in prior research.