TY  - JOUR
T1  - CEO-Employee Pay Ratio and Earnings Management
AU - Kim, Hyeonjeong AU - Nam, Giseok 
JO  - Journal of Engineering and Applied Sciences
VL  - 13
IS  - 14
SP  - 5717
EP  - 5730
PY  - 2018
DA  - 2001/08/19
SN  - 1816-949x
DO  - jeasci.2018.5717.5730
UR  - https://makhillpublications.co/view-article.php?doi=jeasci.2018.5717.5730
KW  - Wage gap between manager and employee
KW  -corporate governance
KW  -earnings management
KW  -retention
KW  -ratio disclosure
KW  -analyzed
KW  -influential
AB  - This study empirically tested the relationship between managerial and employee wage gap and
earnings management for Korean firms listed on KOSPI and KOSDAQ market from 2009-2014. As a result both
the accrued earnings management and the actual earnings management showed a significant negative
correlation with the manager-employee pay ratio. In addition as a result of comparing the corporate governance
with the existing results, it is found that the wage gap when the corporate governance is superior is less
influential on earnings management than it is not. Furthermore, the effect of the pay ratio on the actual earnings
management was analyzed by dividing the sample used in the study into the group with the relatively higher
wage gap and the group with the lower wage gap and the results showed that the effect of the pay ratio on the
earnings management is larger for the group with relatively low wage gap compared with relatively large wage
gap. This empirical result suggests that the wage gap has information usefulness as accounting information
and it is expected that the disclosure of pay ratio between manager and employee will be used as a measure of
earnings management.
ER  -