The Effect of Expensing Employee Bonus on Reward System in Business

• Main Authors: Yen-ru Liao, 廖雁茹
• Other Authors: Tsing-zai Wu
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/54176026382690370735

碩士 === 國立成功大學 === 會計學系碩博士班 === 97 === The employee bonus booms the electronic industry in Taiwan, but still been argued for the causing of the loss of the stockholders' equity. After January 1, 2008, the employee bonus is required to be recognized as an expense and measured by fair value method. This change severely affected the electronic industry. This paper use the data of listed firms during 2005~2008 to investigate if enterprise increases the employee stock option (ESO) instead of decrease the employee bonus after expensing employee bonus and No. 39. Then we using regression analysis deeply discuss the determinants of reward system. For the determinants of reward system, this paper involves a percentage of stock held by directors and human capital to solve agency problem. We also consider the relationship between cash flow, growth opportunity and compensation plan. As a conclusion, we combine the results of this paper with the experiences of foreign research and expect to provide the suggestion of reword system in business. The research results show that (1) After the implementation of expensing employee bonus, the corporate pay less employee bonus and more ESO. Thus, expensing employee bonus does influence the adoption of employee bonus schemes on business. (2) This study also finds a positive relationship between human capital and employee bonus, growth opportunity and ESO. On the contrary, a percentage of stock held by directors has negative impact on the compensation plan. It means when firms with weak corporate governance, usually make lower rates of bonus distribution to solve agency problem. (3) Besides, it also confirms a positive relationship between employee bonus and ROA、firm size, a positive relationship between firm size and compensation plan. (4) Finally, the results support that the better profitability, the more Bonus payout and less ESO payout.