Abstract

Purpose: The stock price delay phenomenon refers to a phenomenon in which stock prices do not immediately reflect corporate information and the reflection is delayed. A prior study reported that the stock price delay phenomenon appears strongly when the quality of corporate information is low (Callen, Khan, & Lu, 2013). The purpose of the internal accounting control system is to improve the reliability of accounting information. Specifically, the more professionals such as certified public accountants are placed in the internal accounting control system, the more information is prevented from being distorted, so the occurrence of stock price delay will decrease. Research design, data and methodology: In this study, companies listed on the securities market from 2012 to 2016 were selected as a sample to analyze whether the stock price delay phenomenon is alleviated as accounting experts are assigned to the internal accounting control system. The internal control personnel data were collected in the "Internal Accounting Control System Operation Report" attached to the business report of each company of the Financial Supervisory Service's Electronic Disclosure System(DART). The measurement method of the stock price delay phenomenon was referred to the study of Hou and Moskowitz (2005). The final sample used in the study is 2,641 firm-years. Results: It was found that companies with certified accountants in the internal accounting control system alleviate the stock price delay phenomenon. This result can be interpreted as increasing the speed at which corporate information is reflected in the stock price by improving the reliability of information disclosed in the market by the placement of experts in the system. Conclusions: The results of this study suggest that accounting professionals assigned to the internal accounting control system are playing a positive role in providing high-quality information to the market. In this study, focusing on the fact that the speed at which corporate information is reflected in the stock price is very important for the stakeholders in the capital market, we find that having a certified public accountant in the internal accounting control system alleviates the stock price delay phenomenon.