earticle

영어

This study aims to test the relation between accounting change and earnings management. If the purpose of accounting change is to escape reporting the loss, the firms will turn a profit after using accounting change. Test period is from 2002 to 2004 and the samples are selected from KOSDAQ firms. The empirical results show that there is significant relation between accounting change and earnings management. The firms used accounting change in order to escape reporting the loss. Especially, they preferred accounting estimation change to accounting method change, and discretionary accounting change to accounting change by regulation. Firm size was related to accounting change among firm characteristics.