Accounting Characteristics Of Corporations By Bonds Issuing Methods: Focused On Public Corporations In South Korea

Abstract

Public corporations of Korea may opt for either online auction or offline issue of bonds, the latter being a more traditional method using investment banks. These two methods have distinct advantages and disadvantages. Corporations that adopt the online issue method tend to have lower earnings management, use more conservative accounting, and enjoy superior scores on the government's assessment of management performance. This means that corporations that choose online, the more transparent issuance method, are more transparent in their accounting practices.