• Journal of Intelligence and Information Systems
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• v.20 no.4
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• pp.141-154
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• 2014

The adoption of International Financial Reporting Standards (IFRS) is the one of important issues in the recent accounting research because the change from local GAAP (Generally Accepted Accounting Principles) to IFRS has a substantial effect on accounting information. Over 100 countries including Australia, China, Canada and the European Union member countries adopt IFRS (International Financial Reporting Standards) for financial reporting purposes, and several more including the United States and Japan are considering the adoption of IFRS (International Financial Reporting Standards). In Korea, 61 firms voluntarily adopted Korean International Financial Reporting Standard (K-IFRS) in 2009 and 2010 and all listed firms mandatorily adopted K-IFRS (Korea-International Financial Reporting Standards) in 2011. The adoption of IFRS is expected to increase financial statement comparability, improve corporate transparency, increase the quality of financial reporting, and hence, provide benefits to investors This study investigates whether recognized accounts receivable discounting (AR discounting) under Korean International Financial Reporting Standard (K-IFRS) is more value relevant than disclosed AR discounting under Korean Generally Accepted Accounting Principles (K-GAAP). Because more rigorous standards are applied to the derecognition of AR discounting under K-IFRS(Korea-International Financial Reporting Standards), most AR discounting is recognized as a short term debt instead of being disclosed as a contingent liability unless all risks and rewards are transferred. In this research, I try to figure out industrial responses to the changes in accounting rules for the treatment of accounts receivable toward more strict standards in the recognition of sales which occurs with the adoption of Korea International Financial Reporting Standard. This study examines whether accounting information is more value-relevant, especially information on accounts receivable discounting (hereinafter, AR discounting) is value-relevant under K-IFRS (Korea-International Financial Reporting Standards). First, note that AR discounting involves the transfer of financial assets. Under Korean Generally Accepted Accounting Principles (K-GAAP), when firms discount AR to banks before the AR maturity, firms conventionally remove AR from the balance-sheet and report losses from AR discounting and disclose and explain the transactions in the footnotes. Under K-IFRS (Korea-International Financial Reporting Standards), however, most firms keep AR and add a short-term debt as same as discounted AR. This process increases the firms' leverage ratio and raises the concern to the firms about investors' reactions to worsening capital structures. Investors may experience the change in perceived risk of the firm. In the study sample, the average of AR discounting is 75.3 billion won (maximum 3.6 trillion won and minimum 18 million won), which is, on average 7.0% of assets (maximum 38.6% and minimum 0.002%), 26.2% of firms' accounts receivable (maximum 92.5% and minimum 0.003%) and 13.5% of total liabilities (maximum 69.5% and minimum 0.004%). After the adoption of K-IFRS (Korea-International Financial Reporting Standards), total liabilities increase by 13%p on average (maximum 103%p and minimum 0.004%p) attributable to AR discounting. The leverage ratio (total liabilities/total assets) increases by an average 2.4%p (maximum 16%p and minimum 0.001%p) and debt-to-equity ratio increases by average 14.6%p (maximum 134%p and minimum 0.006%) attributable to the recognition of AR discounting as a short-term debt. The structure of debts and equities of the companies engaging in factoring transactions are likely to be affected in the changes of accounting rule. I suggest that the changes in accounting provisions subsequent to Korea International Financial Reporting Standard adoption caused significant influence on the structure of firm's asset and liabilities. Due to this changes, the treatment of account receivable discounting have become critical. This paper proposes an intelligent diagnostic system for estimating negative impact on stock value with self-organizing maps and case based reasoning. To validate the usefulness of this proposed model, real data was analyzed. In order to get the significance of this proposed model, several models were compared to the research model. I found out that this proposed model provides satisfactory results with compared models.

• Journal of the Korean Home Economics Association
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• v.27 no.2
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• pp.163-185
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• 1989

Korean home economics education has around 100 years history. The main aims of home economics education up 1950 had not been changed, they were mainly for the improvement of household-skill to raise both standard of living and life quality as well as womanhood. After 1960's the standard of living drastically improved and the industrialization of Korean society was quite rapidly proceeded from simple to complex one. Because of these changes, I considered that the aims and the contents of home economics education should be reexamined and reshaped. This study motivated me that especially home economics major should be trained to be competent enough to work in industrialized society as much as the input to her college education. As industialization was made progress, family member's diverse role differentiation also occurred from past simple role such as house wife or girl's high school teacher among by home economics major. In this current societal change, most of the home economics major have wish to have opportunities obtaining new kinds of employment rather than obtaining merely teaching work. With this in mind I made a study on college level home economics education of the new adjustment to current and future industrialized Korean society. (1) The full number of officially admissible home economics major in 169 Korean colleges, 70 junior colleges, and one open university were as follows, 7139, 6080, and 230 respectively. The percentages of employed of employed numbers of them for the college and junior college graduates were 26.5 and 39.0 respectively. (2) The certificate qualifications issued to college home economics major are nutritionist (1st grade and 2nd grade), clothes and textilist, home economics teacher (2nd grade for high school) and kindergartener (2nd grade), The qualifications are certified after majoring each field from major departments of college of home economics by Ministrys of Labour and Education of the Korean government. The percentages of their employment are low as mentioned earlier. (3) To find out new employment opportunity for home economics graduates in home economist in business (henceforce/HEIB) status quo of consumer division for mational enterprise was surveyed. According to govermment decree of general law of consumer protection (1980), enterprise should organize bureau (offics, subdivision) on liability to consumer's complaint. Of 89.6% of the enterprise established th subdivision in which 96.2% of employee was male (3.8% was female). Of the employee college graduate and high school graduate were 93.2% and 6.8% respectively. On the employee's major acadmic backgroud (%), economics and business administration, engineering and low-political science were 39.5, 26.2 and 11.2 respectively. (4) To study on the relation between home economics and home economist in business, the aspect of historical development of HEIB, group of HEIB employing enterprise and their nature of business were tried to find out as well as perception and evaluation by enterprise on HEIB. (a) In the united States of America employed home economics major to enterprise was organized autonomously HEIB subdivision within American Home Economics Association since 1920's and the membership of HEIB was 3,000 of the AHEA membership 50,000. (b) In Japan the Japanese founder HEIB had three times the bilateral congress with the U.S.HEIB and had 10th anniversary celebration in 1988. Japanese HEIB member are not necessary to be home economics graduates but should have certificate as consumer adviser effected by the Minister of Trade and Industry. Japanese subdivision of consumer affaire within Japanese enterprise employ the consumer adviser with the certificate. Because of this different system from the United Sates, Japanese HEIB call their title "HEEB" instead of HEIB. The Japanese consumer adviser certificate system had initiated since 1980 and it belongs to 2nd level national qualification certificate. Currently active membership of Japanese "HEEB" association had increased from 115 (in 1979) to 319 in 1988. (5) For the opening of the future new employment of home economics graduates to enterprise and qualification required for the HEIB by national enterprise in Korea, I studied on the courses which seem to be important and required by employee in the field of HEEB in the United States of America and preliminary curriculum for home economics related major student aimning to be the future "HEEB" by Japanese HEEB study group of Japanese Association of Home Economics. It is suggested that it is very important and urgent to realize as home economics educator to have common deep concern and endeavors on opening new employment for our home economics major student1), we should try to publicize strongly and let enterprise and consumer protection board realize that employee in the subdivision of consumer protection should be the one who well experienced home economics major graduates2), we, home economics educator, should try to develop actively new curriculum in line of the suggestion made earlier for our future home economics major student of open broadly their future employment opportunities3), we, home economics educators, should try to have consensus on whether we should have support from government in terms of receiving national qualification certificate on consumer pretection or not4), and I would appreciate if the Korean Home Economics Association and Korean Home Management Society paydeep and positive concern on this matter.

• The Korean Society of Law and Medicine
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• v.17 no.2
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• pp.177-219
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• 2016

A commercial advertisement is not only a way of competition but also a medium of communication. Thus, it is under the constitutional protection of the freedom of business (article 15 of the Constitution) as well as the freedom of press [article 21 (1) of the Constitution]. In terms of the freedom of business or competition, it should be noted that an unfair advertising (false or misleading advertisement) can be regulated as an unfair competition, while any restraint on advertising other than unfair one might be doubted as an unjustifiable restraint of trade. In terms of the freedom of press or communication, it is important that article 21 (2) of the Constitution forbids any kind of (prior) censorship, and the Constitutional Court applies this restriction even to commercial advertising. In this article, the applicability of these schemes to advertising of the so-called learned professions, especially physician, are to be examined, and some proposals for the reformation of the current regulatory regime are to be made. Main arguments of this article can be summarized as follows: First, the current regime which requires advance review of physician advertising as prescribed in article 56 (2) no. 9 of Medical Act should be reformed. It does not mean that the current interpretation of article 21 of the Constitution is agreeable. Though a commercial advertising is a way of communication and can be protected by article 21 (1) of the Constitution, it should not be under the prohibition of censorship prescribed by article 21 (2) of the Constitution. The Constitutional Court adopts the opposite view, however. It is doubtful that physician advertising needs some prior restraint, also. Of course, there exists severe informational asymmetry between physicians and patients and medical treatment might harm the life and health of patients irrevocably, so that medical treatment can be discerned from other services. It is civil and criminal liability for medical malpractice and duty to inform and not regulation on physician advertising, to address these differences or problems. Advance review should be abandoned and repelled, or substituted by more unproblematic way of regulation such as an accreditation of reviewed advertising or a self-regulation preformed by physician association independently from the Ministry of Health and Welfare or any other governmental agencies. Second, the substantive criteria for unfair physician advertising also should correspond that of unfair advertising in general. Some might argue that a learned profession, especially medical practice, is totally different from other businesses. It is performed under the professional ethics and should not persue commercial interest; medical practice in Korea is governed by the National Health Insurance system, the stability of which might be endangered when commercial competition in medical practice be allowed. Medical Act as well as the condition of medical practice market do not exclude competition between physicians. The fact is quite the opposite. Physicians are competing even though under the professional ethics and obligations and all the restrictions provided by the National Health Insurance system. In this situation, regulation on physician advertising might constitute unjustifiable restraint of competition, especially a kind of entry barrier for 'new physicians.'

• Korean Security Journal
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• no.29
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• pp.163-191
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• 2011

Recently, the problems in school violence did not stop on the crime between the members at the school and which developed into the invasion crime of the school caused by outsiders. The school is no more the safety zone from the crime. Particularly, in the case of the elementary school, because there are nearly no people who oppose to the outside attacker and can control this, it is the place where it is vulnerable to the invasion crime. The Metropolis of Seoul implements the School Sheriff system within the jurisdiction bureau, in the public elementary school. However, actually the School Sheriff business is being managed, never applying a rule in the Security Industry Law with the main content, that is the Security Industry Law application is excluded. Because the jurisdiction on the contract of Seoul City and operating company are run, the various issues is caused. First, since it is not being considered as a security business, the commercial liability insurance for security company has no chance to applicate when the operation company and the School Sheriff have related damage generation. So the security for the indemnification of loss of the victim is weak. Second, The task of the School Sheriff is ruled just by in the individual contracts. But it is insufficient with this thing. The related duties are required some supplement like a general rule application including the obligation of the guard in the security industry law. Third, the education of the School Sheriff needs to connect with the educational programme in the security industry law. The related professional education specially needed for the prevention of school violence ought to be reserved compensation. Forth, the citizens still demand the strengthening of police patrol for the surroundings of a school in spite of the result of Seoul City's public survey. Therefore, the active relation of cooperation with the police needs to be supported legally and institutionally with the Security Industry Law application. Fifthly, the success of the School Sheriff business can be more guaranteed with the supervision of the legal and institutional device like a the Security Industry Law application or police and all sorts of administrative execution's and etc.

• The Korean Society of Law and Medicine
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• v.20 no.3
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• pp.83-139
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• 2019

Recognition of liability for damages due to medical malpractice has been developed largely on the basis of two paths. First is the case where there is an error in a physician's medical practice and this infringes upon the legal interests of life and body, and the compensation for monetary and non-monetary damages incurred from such infringement on life and body becomes an issue. Second is the case where there is a breach of a physician's duty of explanation that results in a infringement on the patient's right of autonomous decision, and the compensation for non-monetary damages incurred from such infringement becomes an issue. However, even if there is a medical error, since it is difficult to prove the causation between the medical error of a physician and the infringement upon legal interests, the physician's responsibility for damage compensation is denied in some cases. Consider, for example, a case where a patient is already in the final stage of cancer and has a very low possibility of a complete recovery even if proper treatment is received from the physician. Here, it is not appropriate to refuse recognition of any damage compensation based on the reason that the possibility of the patient dying is very high even in the absence of a medical error. This is so because, at minimum, non-monetary damage such as psychological suffering is incurred due to the physician's medical error. In such a case, our courts recognize on an exceptional basis consolation money compensation for losing the chance to receive proper treatment. However, since the theoretical system has not been established in minutiae, what comes under the benefit and protection of the law is not clearly explicated. The recent discourse on compensating for damages incurred by patients, even when the causation between the physician's medical error and infringement upon the legal interests of life and body is denied, by establishing a new legal interest is based on the "legal principle of loss of opportunity for treatment." On what should be the substance of the new legal interest, treatment possibility argument, expectation infringement argument, considerable degree of survival possibility infringement argument and loss of opportunity for treatment argument are being put forth. It is reasonable to see the substance of this protected legal interest as "the benefit of receiving treatment appropriate to the medical standard" according to the loss of opportunity for treatment argument. The above benefit to the patient is a value inherent to human dignity that should not be infringed upon or obstructed by anyone, and at the same time, it is a basic desire regarding life and a benefit worthy of protection by law. In this regard, "the benefit of receiving treatment appropriate to the medical standard" can be made concrete as one of the general personal rights related to psychological legal interest.

• The Korean Society of Law and Medicine
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• v.18 no.2
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• pp.163-194
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• 2017

Coronary artery disease has increased in Korea as the country enters the aged society. It is well known that the incidence of coronary artery disease is related to aging, hypertension, diabetes, hyperlipidemia, and dietary habit. For effective treatment of significant coronary stenosis, close coordination between cardiac surgery and cardiology team is essential. Especially cardiologists' decision whether to do the stent placement or CABG is very important because the cardiologists usually start to consult the patients for their treatment. Recently, non-surgical interventions(that is stent placement) in cardiology field have dramatically increased as the national insurance system removed the limitation of the number of stents deployed. However, accidents are often caused by inappropriate use of stents, especially in patients with triple coronary disease or left main disease with heavy coronary calcifications. Another aspect of stent placement is to cope with an emergency case in the event of coronary rupture or pericardial tamponade during coronary interventions without cardiac surgeons. In the past two years, the Korea Consumer Agency (Consumer Dispute Coordination Committee) analyzed eight cases of medical dispute settlement. Only two hospitals were manned with both cardiologists and cardiac surgeons. Seven patients died of procedures of stenting and five patients died on the day of the procedure. Among the 8 cases, 5 cases showed 3 vessel disease and the rest of the cases had either severe calcification, complete occlusion or poor coronary antomies for stenting According to a 2017 national data registry of coronary stenting, less than 3 drug-eluting stents were implanted in 98% of all patients. In 2015, the number of stent procedures was 38,922, and approximately in 800 (2%) cases, more than four stents were used per patient. We emphasize that it is necessary to seriously consider the cost-benefit analysis between stent and CABG. The patient has the right to choose the right procedure by asking the liability of 'instruction explanation obligation'. He should be well informed of the pros and cons of both procedures to avoid overuse of stent. It can be solved by intimate discussion of individual cases with the cardiac surgeon and the patient. Unilateral dialogue with the patient, forceful restriction on the number of stenting, lack of surgeon's backup in difficult cases should all be avoided. It is also necessary to solve the problem not only at the hospital level, such as multidisciplinary integrated medical care, but also a nationwide solution such as expanding cardiac surgeons as essential personnel to public officials.

• Journal of Korean Society of Transportation
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• v.35 no.4
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• pp.360-373
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• 2017

The BTO-a projects is the types, which has a demand risk among the type of PPP projects in Korea. When demand risk is realized, private investor encounters financial difficulties due to lower revenue than its expectation and the government may also have a problem in stable infrastructure operation. In this regards, the government has applied various risk sharing policies in response to demand risk. However, the amount of government's risk sharing is the government's contingent liabilities as a result of demand uncertainty, and it fails to be quantified by the conventional NPV method of expressing in the text of the concession agreement. The purpose of this study is to estimate the value of investment risk sharing by the government considering the demand risk in the profit sharing system (BTO-a) introduced in 2015 as one of the demand risk sharing policy. The investment risk sharing will take the form of options in finance. Private investors have the right to claim subsidies from the government when their revenue declines, while the government has the obligation to pay subsidies under certain conditions. In this study, we have established a methodology for estimating the value of investment risk sharing by using the Black - Scholes option pricing model and examined the appropriateness of the results through case studies. As a result of the analysis, the value of investment risk sharing is estimated to be 12 billion won, which is about 4% of the investment cost of the private investment. In other words, it can be seen that the government will invest 12 billion won in financial support by sharing the investment risk. The option value when assuming the traffic volume risk as a random variable from the case studies is derived as an average of 12.2 billion won and a standard deviation of 3.67 billion won. As a result of the cumulative distribution, the option value of the 90% probability interval will be determined within the range of 6.9 to 18.8 billion won. The method proposed in this study is expected to help government and private investors understand the better risk analysis and economic value of better for investment risk sharing under the uncertainty of future demand.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.31
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• pp.27-56
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• 2006

Today's financial institutions usually take environmental issues seriously into consideration as they could not evade lender liability in an increasing number of cases. On the international scene, a brand-new concept of the "Equator Principles" in the New Millenium has driven more and more international banks to adopt these Principles in project financing. Sustainable development has been a key word in understanding new trends of the governments, financial institutions, corporations and civic groups in the 21st century. The Equator Principles are a set of voluntary environmental and social guidelines for sustainable finance. These Principles commit bank officers to avoid financial support to projects that fail to meet these guidelines. The Principles were conceived in 2002 on an initiative of the International Finance Corporation(IFC), and launched in June 2003. Since then, dozens of major banks, accounting for up to 80 percent of project loan market, have adopted the Principles. Accordingly, the Principles have become the de facto standard for all banks and investors on how to deal with potential social and environmental issues of projects to be financed. Compliance with the Equator Principles facilitates for endorsing banks to participate in the syndicated loan and help them to manage the risks associated with large-scale projects. The Equator Principles call for financial institutions to provide loans to projects under the following circumstances: - The risk of the project is categorized in accordance with internal guidelines based upon the environmental and social screening criteria of the IFC. - For Category A and B projects, borrowers or sponsors are required to conduct a Social and Environmental Assessment, the preparation of which must meet certain requirements and satisfactorily address key social and environmental issues. - The Social and Environmental Assessment report should address baseline social and environmental conditions, requirements under host country laws and regulations, sustainable development, and, as appropriate, IFC's Environmental, Health and Safety Guidelines, etc. - Based on the Social and Environmental Assessment, Equator banks then make agreements with borrowers on how they mitigate, monitor and manage the risks through a Social and Environmental Management System. Compliance with the plan is included in the covenant clause of loan agreements. If the borrower doesn't comply with the agreed terms, the bank will take corrective actions. The Equator Principles are not a mere declaration of cautious banks but a full commitment of lenders. A violation of the Principles in the process of project financing, which led to an unexpected damage to the affected community, would not give rise to any specific legal remedies other than ordinary lawsuits. So it is more effective for banks to ensure consistent implementation of the Principles and to have them take responsible measures to solve social and environmental issues. Public interests have recently mounted up with respect to environmental issues on the occasion of the Supreme Court's decision (2006Du330) on the fiercely debated reclamation project at Saemangeum. The majority Justices said that the expected environmental damages like probable pollution of water and soil were not believed so serious and that the Administration should continue to implement the project seeking ways to make it more environment friendly. In this case, though the Category A Saemangeum Project was carried out by a government agency, the Supreme Court behaved itself as a signal giver to approve or stop the environment-related project like an Equator bank in project financing. At present, there is no Equator bank in Korea in contrast to three big banks in Japan. Also Korean contractors, which are aggressively bidding for Category A-type projects in South East Asia and Mideast, might find themselves in a disadvantageous position because they are generally ignorant of the environmental assessment associated with project financing. In this regard, Korean banks and overseas project contractors should care for the revised Equator Principles and the latest developments in project financing more seriously. It's because its scope has expanded to the capital cost of US$10 million or more across all industry sectors regardless of developing countries or not. It should be noted that, for a Korean bank, being an Equator bank is more or less burdensome in a short-term period, but it must be conducive to minimizing risks and building up good reputation in the long run.

• Ocean and Polar Research
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• v.37 no.4
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• pp.341-356
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• 2015

A nation has a sovereign right to develop and use its natural resources according to its policies with regard to development and the relevant environment. A nation also has an obligation not to harm other countries or damage environments of neighboring countries as consequences of such actions of developments or use of natural resources. However, international precedents induce a nation to take additional actions not to cause more damages from the specific acts causing environmental damages beyond national borders, when such acts have economic and social importance. That is to say that there is a tendency to resolve such issues in a way to promote the balance between the mutual interests by allowing such actions to continue. A solution to China's Three Gorges Dam dilemma based on a soft law approach is more credible than relying on a good faith approach of national responsibilities and international legal proceedings since the construction and operation of the dam falls within the category of exercising national sovereign rights. If a large scale construction project such as the Three Gorges Dam or operation of a nuclear power plant causes or may cause environmental damage beyond the border of a nation engaged in such an undertaking, countries affected by this undertaking should jointly monitor the environmental effects in a spirit of cooperation rather than trying to stop the construction and should seek cooperative solutions of mutual understanding to establish measures to prevent further damages. If China's Three Gorges Dam construction and operation cause or contain the possibility of causing serious damages to marine environment, China cannot set aside its national responsibility to meet international obligations if China is aware of or knows about the damage that has occurred or may occur but fail to prevent, minimize, reverse or eliminate additional chances of such damages, or fails to put in place measures in order to prevent the recurrence of such damages. However, Korea must be able to prove a causal relationship between the relevant actions and resulting damages if it is to raise objections to the construction or request certain damage-prevention actions against crucial adverse effects on the marine environment out of respect for China's right to develop resources and acts of use thereof. Therefore, it is essential to cumulate continuous monitoring and evaluations information pertaining to marine environmental changes and impacts or responses of affected waters as well as acquisition of scientific baseline data with observed changes in such baseline. As China has adopted a somewhat nonchalant attitude toward taking adequate actions to protect against marine pollution risks or adverse effects caused by the construction and operation of China's Three Gorges Dam, there is a need to persuade China to adopt a more active stance and become involved in the monitoring and co-investigation of the Yellow Sea in order to protect the marine environment. Moreover, there is a need to build a regular environmental monitoring system that includes the evaluation of environmental effects beyond borders. The Espoo Convention can serve as a mechanism to ease potential conflicts of national interest in the Northeast Asian waters where political and historical sensitivities are acute. Especially, the recent diplomatic policy advanced by Korea and China can be implemented as an important example of gentle cooperation as the policy tool of choice is based on regional cooperation or cooperation between different regions.

• Journal of Distribution Science
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• v.10 no.5
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• pp.45-55
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• 2012

In Korea, the parcel delivery service was launched officially in 1992, and the market has grown to 13.2 billion units, or 3.5 trillion won, as of 2011. The service companies accept small packages under 30 kg and deliver them on the next day in most domestic areas. This service plays an important role in business and personal activities. The parcel service companies have themselves designed the tariff for the delivery service based on two criteria: weight and the sum of three side lengths. Further, the tariff is graded in steps of three or four rate structures based on size (small, medium, large, and extra-small). However, the basic freight rate is generally decided according to the cargo's weight or measurement size, and an extra rate is added according to some factors (handling, stowability, liability, and so on). The parcel service tariff adopted by the companies is illogically designed, and this study was carried out to assess the need for redesigning the tariff structure. The cargo volume cannot be logically reflected by three side lengths. For example, two parcels measuring 160 cm based on three side lengths may have different volumes, one measuring 0.152 cbm (53.33 cm × 53.33 cm × 53.34 cm) and the other 0.05 cbm (100 cm × 50 cm × 10 cm). A small package of less than120 cm (sum of three side lengths) may have a volume of as much as 0.064 cbm (40 cm × 40 cm × 40 cm). Sample comparison showed that 17% of medium-size parcels (based on the sum of three side lengths) are small-volume packages, 24% of large-size parcels are small- or medium-volume packages, and 40% of extra-big-size parcels are big- or under-size packages. Therefore, if parcel service companies rate their services for volume cargo based on the three side lengths standard, users may have to pay higher than normal rates, particularly because a large percentage of parcels are volume cargo. According to this study, the average weight per 1 cbm is less than 300 kg. Therefore, users face an increasing risk of paying higher than logical freight charges. Generally, transportation companies are called "public interest enterprises," and parcel service companies operate as postal services. Public interest enterprises must provide the delivery service to all customers without discrimination at a reasonable service level and logical service charges. Therefore, parcels service tariffs must be designed and adopted logically. In this study, freight theories and prior research findings were used to consider the importance of freight rates, and distortion of parcel service rates based on the three side lengths system was verified through regression analysis of a parcel sample and sample comparison. In conclusion, volume sizes based on three side lengths have a higher correlation to the rate level than does the sum of three side lengths. Further, compared to the sum of three side lengths, volume size has a higher correlation to cargo weight, which is the most basic factor determining transportation cost. Therefore, the existing parcel service tariff should be changed to weight- and volume-based rates, and the tariff must be graded in steps of 8 to 10 higher rate structures for a logical freight schedule based on service cost.