K-IFRS 자발적 도입 비상장기업의 감사보수 및 특성에 관한 연구

Abstract

We investigate whether the audit fees in the pre (FY 2009) and the post (FY 2011) of K-IFRS adoption between unlisted adopters and unlisted non-adopters are different, and which characteristics make unlisted companies adopt K-IFRS voluntarily. According to the result of audit fees, the level of audit fees of unlisted adopters is significantly higher than that of unlisted non-adopters in both of the pre and the post of K-IFRS adoption. In case of unlisted adopters, the level of audit fees of the post of K-IFRS adoption is significantly higher than that of the pre of K-IFRS adoption. In case of unlisted non-adopters, however, the opposite result is shown. With matching sample, the level of audit fees between unlisted adopters and non-adopters is not significantly different in the pre (FY 2009) of K-IFRS adoption, but the level of audit fees of unlisted adopters is significantly higher than that of unlisted non-adopters in the post (FY 2011) of K-IFRS adoption. Additionally, the level of audit fees of unlisted adopters between the pre (FY 2009) and the post (FY 2011) of K-IFRS adoption is not significantly different after adjusting with inflation. From the result of characteristics of voluntary adoption, unlisted companies adopt K-IFRS voluntarily if they are the subsidiaries of listed companies or they prepare IPO (initial public offering). They also adopt K-IFRS more voluntarily as the assets are greater, the liability ratio lower, and the growth rate higher. And voluntary unlisted K-IFRS adopters are likely to change auditor to Big 4. The suggestions for improvement about audit market and audit fees of unlisted companies are as follows. First, the supervisory authority has to make a guideline of audit fees for unlisted companies to regulate the excessively low audit fees. Second, accounting firms need not to unnecessarily compete with one another, which means that accounting firms need to compete by audit quality not by audit fees to maintain proper audit fees. Third, unlisted companies need to adopt K-IFRS mandatorily because accounting comparability among unlisted companies is likely to drop if the supervisory authority permit two GAAP system as current situation. The results of our study provide some implications to auditors, unlisted companies, and regulators. First, auditors have to input sufficient audit time and effort and charge proper audit fees to improve audit-quality. Second, unlisted companies have to do their best to increase the credibility and the transparency of their financial information. Especially, voluntary unlisted K-IFRS adopters have to make an effort to provide high-quality financial information to keep up with the goal of K-IFRS adoption. Third, the supervisory authority has to monitor unnecessary competition among audit firms to maintain proper audit fees and to improve audit quality. The regulator also has to make a policy to mitigate the concentration of auditors to Big 4 because this phenomenon is getting obvious after the adoption of K-IFRS. Finally, the number of unlisted companies that should be audited by independent auditors is expected to reduce by 2,000 because the limit of assets whose companies should be audited revised from 10 billion won to 12 billion won according to the regulation about audit. Therefore, it is necessary to expand the mandatory auditees to increase accounting transparency and credibility. Oh et al.(2009) document that unlisted companies with qualified audit opinion pay lower audit fee while listed companies with qualified audit opinion pay higher audit fees. They interpret the result that auditors are likely to require compensation of the increased audit risk for listed companies with qualified audit opinion while auditors are likely to burden the risk of auditor switch for unlisted companies with qualified audit opinion because auditees have more audit bargaining power than incumbent auditors in case of unlisted companies. Park and Park(2013) document that the level of earnings management (both of real and accrual-based) of unlisted companies are lower as abnormal audit fees are much higher. They interpret the result that excessively low audit fees would deteriorate audit quality, and their result support to regulate excessively low audit fees and to make unlisted companies pay proper audit fees. Even though this study provides various implications to auditors, unlisted companies, and regulators, it has some limitations about shortage and short-window data of unlisted companies. Therefore, it is necessary to carefully use or apply the results of this study.