• KDI Journal of Economic Policy
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• v.37 no.2
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• pp.22-39
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• 2015

After a long, dormant period, recent attention has turned to a variety of measurement issues surrounding the concept of human capital. The traditional approach of rely entirely on measures of school attainment, while convenient, is almost certainly misleading. The availability of cognitive skills measures greatly improves on these measurements, but there remains also concern about other unmeasured factors, including noncognitive skills. This paper considers alternative approaches to assessing the role of human capital on individual earnings and on economic growth.

• Journal of Distribution Science
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• v.12 no.4
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• pp.85-92
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• 2014

Purpose - This study conducted empirical research on non-financial corporations listed on the stock exchange from 2001 to 2010, focusing on the effects of corporate governance on real earnings management of corporations. In particular, this study examined primarily the impact of the largest shareholder who could use earnings management to pursue his own self-interest, and foreign investors who played a checking role against the largest shareholders. The study also reviewed the relationship between corporate governance and earnings management while also considering corporate growth. Research design, data, and methodology - As for the measurements of real earnings management, abnormal operating cash flow and abnormal production cost were utilized. As for the independent variables, share ratio of the largest shareholder and affiliate person (M) and share ratio of foreign investors (FT) were leveraged. This study excluded those organizations that had changed their fiscal years, those that had not submitted an audit report, corporations under supervision, delisted corporations, corporations that had changed their business type, and so on, from the non-financial corporations out of the publicly traded corporations whose fiscal year ended in December from 2001 to 2010 in addition, KIS values were utilized for the corporate financial data in the study. To verify whether management structure and growth had an impact on real earnings management of a corporation through empirical analysis, a multiple regression analysis model was applied. Result - First, as a result of the analysis, the share ratio (M) of the largest shareholder and affiliate person was found to have a significant positive correlation with abnormal cash flow from operations(ACF) and abnormal production cost (APD). When controlling the growth, the share ratio (M) of the largest shareholder and affiliate person was found to have an insignificant correlation with abnormal cash flow from operations(ACF) but a significant correlation with abnormal production cost (APD). Second, foreign ownership (FT) was found to have a significant positive correlation with abnormal cash flow from operations(ACF) and abnormal production cost (APD) at the confidence level of 1 percent when not including the growth dummy. When controlling the growth, foreign ownership (FT) was found to have a significant negative correlation with abnormal cash flow from operations (ACF) and with abnormal production cost (APD). Conclusion - The results imply that the largest shareholder is closely related to earnings management through real activities regardless of corporate growth. It is also possible to determine from these results that foreign investors are related to earnings management through real activities when not considering corporate growth, but that they would reduce earnings management in the case of considering the growth. Thus, this study verified along with the existing studies that foreign investors were conducting the control function on controlling shareholders.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.8
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• pp.57-66
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• 2021

The outbreak of the financial crisis, the lack of corporate governance practices in Iraqi companies, the high level of earnings management (EM), and weak firm performance (FP) have all encouraged the purpose of this study. This study proposes to achieve the following objectives: (I) to investigate the influence of governance mechanisms on the earnings management practices, (II) to investigate the consequence of EM on FP. The study sample includes 65 Iraqi firms listed on the Iraqi stock exchange for six years from 2012 to 2018, with 390 firm-year observations. The hypotheses were tested using panel data regression. According to the findings, Iraqi companies prefer to use real EM rather than accruals EM to avoid reporting losses. Discretionary cash flow, production costs, and cash flow from operation are examples of actual operations employed to undertake EM. Furthermore, according to the findings of this study, board meeting frequency and female onboard have a significant and negative influence on EM. Besides, the internal audit function was found not to affect EM. On the other hand, results revealed a significant and negative relationship between EM and FP. According to the study, management prefers to minimize cash and accrual expenditure during the economic downturn.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.3
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• pp.391-397
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• 2021

This study examines the effect of independent commissioners and the Audit Committee on internal control disclosure and its implications for earnings management in the banking industry listed on the Indonesia Stock Exchange for the period 2016-2018. In this study, a purposive sampling technique was used, combined with two multiple regression analysis models. The final sample for this study comprised 30 companies over the three years of observation, such that there were 90 observations in total. This study indicates that independent commissioners, as measured by their composition, do not affect the disclosure of internal control. However, as measured by the number of members, the Audit Committee had a positive effect on internal control disclosures. This study also indicates that the disclosure of internal control as measured by the Internal Control Disclosure index affects reducing the negative practice of earnings management. This study proves that the Audit Committee's role is very dominant in assisting the Board of Commissioners in supervising internal control. This has implications for reducing earnings management practices. However, the Independent Commissioner's role in the Indonesian banking industry has not been optimal in carrying out the supervisory function in this study.

• The Journal of Asian Finance, Economics and Business
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• v.6 no.2
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• pp.45-54
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• 2019

This study examines whether auditors restrain the analysts' opportunistic behavior as reviewing the companies' interim reports. Analysts' forecasts show a walkdown pattern in which their optimism has decreased as the earnings announcement date has approached. At the beginning of the year, there is a lack of high-quality benchmark information that enables information users to judge the accuracy of analyst's earnings forecasts. Thus, early in the year, analysts are highly inspired to disseminate optimistic forecasts in order to gain manager's favor. In this study, we examine adequate benchmarks prevent analysts from disclosing optimistically biased forecasts. We conjecture that auditors' efforts might mitigate analysts' walkdown pattern. To test this hypothesis, we use data from Korea, where it is mandatory to disclose auditor's review hours. We find that the analyst forecast's walkdown decreases with the ratio as well as the number of audit hours. It implies that an auditor's effort in reviewing interim financial information has a monitoring function that reduces analysts' opportunistic optimism at the beginning of the year. We conjecture that the tendency will be more pronounced when BIG4 auditors review the interim reports. Consistent with the prediction, BIG4 auditors' interim review effort is more effective in suppressing the analysts' walkdown.

• Management & Information Systems Review
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• v.25
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• pp.203-222
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• 2008

This thesis examines whether accounting information-earnings and book values-has the value relevance in the KOSDAQ. The study is motivated by previous studies which have examined the value relevance of accounting information. Prior researches have focused on KSE(Korea Stock Exchange). But, prior researches have not examined the value relevance of accounting information in KOSDAQ. So, this study examined the value relevance of accounting information which is disclosed by firms on KOSDAQ and whether accounting information between firms on KOSDAQ and KSE has the discriminative value relevance, underlying the expectation that KOSDAQ firms will have higher future profitability than KSE firms. In other words, book-value multiples of KOSDAQ firms is higher than book-value multiples of KSE firms and earnings multiples of KOSDAQ firms is lower than earnings multiples of KSE firms. The value relevance of accounting information is examined by a valuation framework presented by Ohlson(1995), which expresses the stock-price as a function of both earnings and book values of equity. The results indicate that accounting information of KOSDAQ has significant explanatory power for stock price over the 2005-2007 period. KOSDAQ firm are divided by Venture firms and Small to Mid size firms. KOSDAQ Venture firms have the discriminative value relevance, compared with KSE firms. But, KOSDAQ Small to Mid size firms have not the discriminative value relevance, compared with KSE firms.

• The Korean Journal of Applied Statistics
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• v.22 no.4
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• pp.805-817
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• 2009

Interest about the effect of military service is increasing because of the renewal of military service incentive system in Korea. In the background, men has been experienced which suffer monetary and non-monetary damages through the compulsory military service in Korea. However there are few studies that analyze the labor market effect of military service. This study takes advantage of male worker's data of 10th KLIPS(Korea Labor & Income Panel Survey) in 2007 and analyze the wage effect of military service. According to empirical result using Mincerian earnings function, the positive effect of military service appeared. These result shows men who finished military duty have an monetary advantage in Korean labor market unlike general perceptions on military service.

• Journal of Labour Economics
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• v.31 no.3
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• pp.47-74
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• 2008

Following two pioneering works, Medoff and Abraham(QJE 1980; JHR 1981) and Flabbi and Ichino(LE 2001) which use performance rating of personnel data as individual worker's productivity, this study replicates their analysis using a Korean large firm's personnel data(2000, male white collar workers). According to their methods through Mincerian earnings function, and multinomial logit model that links the distribution of wages and performance ratings, we find that seniority wages appeare continuously even if individual worker's productivity is controlled. Therefore we conclude that incentive or deferred compensation theory is more suitable than human capital theory.

• Journal of Labour Economics
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• v.29 no.2
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• pp.29-66
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• 2006

This study investigates the structural change of wage determination within internal labor market that have occurred around the financial crisis in 1997 by using the personnel data(1996~2000) of a Korean large firm. We take the effect of performance-based pay system to apply on wage determination of workers using Mincerian earnings function estimation. After introducing the annual salary system in the firm, we did not find the fact that the wage effect of seniority decreases, but we found the wage effect of relative evaluation ratings increases. Then, this study identifies the importance of the reward strategy of firm in Korean internal labor market. Finally, we have concluded that although the firm acknowledged the positive effects of performance-based HRM practices, we have not obtained enough evidence on the transformation into such practices because the seniority-based HRM has been traditionally prevalent in the Korean internal labor market.

• The Journal of Society for e-Business Studies
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• v.19 no.2
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• pp.143-158
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• 2014

Country ownership and management of information security companies generally do not clearly separate from the Board of Directors to function smoothly controlling shareholders do not participate in management decision-making and internal control board does not perform the task correctly, they said the issue was raised. The purpose of this study is to improve corporate governance, information security companies of the outside director system was introduced as part of the transparency of accounting information to investigate whether the effectiveness of the overall business management is also part of the efficient management of operations and earnings being with respect to the empirical data would be analyzed using the. This means that with the specific purpose of the characteristics of a technology-intensive company focusing on information security proportion of outside directors and outside directors of the board of directors of the board of directors of the target attendance rate for identifying the relationship between earnings management purposes. The empirical results is the ratio of outside directors and the relationship between discretionary accruals as a temporary negative (-) boyimyeo significant relationship, so was adopted. is discretionary accruals and attendance of outside directors, as is the hypothesis that the regression coefficient negative (-) shows the relationship between the mind, so was adopted.