발생액 이익조정과 실제이익조정에 관한 연구: 대체적인가, 보완적인가?

Abstract

Managers have some incentives to manipulate earnings intentionally and have two tools to manage it. Those are accrual based earnings management (AEM) and real earnings management (REM). Most of studies have been previously disparate. Managers show opportunistic behavior of increasing earnings with these tools. Graham et al. (2005) finds that managers prefer real activities manipulation over accrual based manipulation because the real earnings management have direct effects on cash flows. Cohen and Zarowin (2010) explain two reasons why managers have an preference of real earnings management over accrual based earnings manipulation. First, real earings manipulation is safer from inspection of audit and regulator than accrual based strategy. Second, real activities manipulation is the last option to increase reported income. Sometimes only accrual based manipulation is not enough to meet the threshold which manager want to perform. According to these reasons, managers are likely to regard two manipulation as complimentary methods. But Zang (2012)’s study investigate tradeoffs between two methods. She concludes that managers utilize the two manipulation as substitutes. According to Cohen and Zarowin (2010)’s comment about a preference for real earnings management and a cost of earnings manipulation, these make firms regard two as complementary rather than substitution relation. To find the association between accrual based and real earnings management in this study, we try to investigates the influence of Big4 audit firms and audit tenure which is proxy variables of audit scrutiny on the level of accrual and real earnings management in Korean firms. Several previous researches have already showed that Big4 and audit tenure controls the degree of accrual based earnings management in firms. Audit scrutiny is an important factor to influence the degree of manipulation through boosting accruals. Audit scrutiny does not have effect on real earnings manipulate. The influence of it on accruals based earnings manipulation may have indirect effect on the level of real earnings management. If two manipulation strategies are substitutionary relationship, high scrutiny get managers to increase the amount of real earnings management because it is hard for them to manipulate accruals. If one is complementary thing of the other, the effect of audit scrutiny on real earnings management is changed. We suggest an hypothesis below. Hypothesis: The quality of audit influences the degree of real earnings manipulation. The study finds followings through empirical analyses. First, Big4 audit firms decreases both the degree of accrual and real earnings management in firms. second, audit tenure has negative relationship with the extent of discretion accruals as a proxy for measure of accrual based earnings management. Based on these empirical evidences, we conclude that manger use two tools of earings manipulation simultaneously to increase earnings. in other words, two methods of managing earings are not substitutionary but complementary relation. It is rational result considering that concentrating on one, it increases cost of manipulation. In addition, we run one more regression analysis in which the dependent variable is AEM (REM) including REM (AEM) as the independent variable. We find the positive association between them, suggesting that those are complementary relation rather than substitutionary relation. It is different result of Zang (2012)’s study which try a regression analysis in which the dependent variable is AEM with unexpected REM find the negative relation.