Korean Governmental Accounting Review 17(1) pp.99-132.
ISSN/ISBN: Not available at this time. DOI: Not available at this time.
Note - this is a foreign language paper: KOR
Abstract: As a result of the government’s strong policy to reduce the debt ratio of local public enterprises, local public enterprises are often incentive to adjust their debt ratios, which often occur in private companies. This study compares the distribution of the number of digits of accounting account numbers related to the debt ratio and the ratio with the distribution of Benford, and tries to grasp the debt ratio adjustment behavior of local public enterprises. As a result, the debt ratio does not follow the Benford law. The total debt figure follows the Benford distribution, indicating that an artificial debt manipulation or adjustment possibility is relatively small compared to other accounts and that the asset and capital figures are more likely to be adjusted or manipulated. By analyzing them in detail, I have confirmed the tendency to reduce the debt ratio by adjusting or manipulating the numerical values of non-current assets rather than current assets, current liabilities rather than non-current liabilities, and most components of capital. In conclusion, it means that local public enterprises are responding to the financial structure improvement policy focused on debt ratio rather than debt size. In order to achieve a simple target debt ratio, it is interpreted to intentionally achieve target debt ratio by manipulating or adjusting non-current assets, current liabilities and capital of public enterprises.
Bibtex:
@article{,
author={Dong-wuk Kim and Ho-Nam Moon},
title={{A Study of the Debt Ratio Management Behavior of Local Public Enterprises Using Benford's Law}},
booktitle={{제17권 1호}},
journal={{Korean Governmental Accounting Review}},
volume={{17}},
issue={{1}},
publisher={The Korean Association for Governmental Accounting},
year={2019},
pages={99--132},
url={https://www.earticle.net/Article/A352193}
}
Reference Type: Journal Article
Subject Area(s): Accounting, Economics