With the recent adoption of IFRS (International Financial Reporting Standards) in Korea,the type of accounting standards has been changed from a rule-based standard to a principlebased standard. Rule-based standards typically provide very detailed guidelines and bright line tests by using numerically expressed rules in determining the correct accounting treatments for a transaction or event. In contrast, principle-based standards are documents of broad principle,which rely on the professional judgement of the users of the standards. In principle-based standards, most principles are expressed verbally with few rule and guidelines for specific accounting treatment. According to psychology research, the verbally expressed standards (principle-based) are perceived less precise than the numerical stated standards (rules-based). By providing broad principle, principle-based standards allow users to do discretionary accounting treatment within the principles. Principle-based approach, therefore, makes it possible for a manager to choose the accounting treatment suited for their corporate circumstances. However,there might be a possibility of expanding a manager's tendency to make an opportunistic choice when deciding accounting treatment or to spread aggressive financial reporting. Also,preparers or auditors may treat the same accounting transactions differently, because there are no specific rules in a principle-based standard. The previous research have analyzed the influence of the types of accounting standards on preparers' financial reporting judgments. Many studies reported that principle-based standards mitigate aggressive reporting decision, but the opposite results are also reported. In Korea, a principle-based standard, Korean-IFRS, has been implemented since 2011, so the impacts of such standard-type changes need to be studied. This paper investigates the effect of type of accounting standards on the judgments of auditors in lease classification. Additionally, this study analyses the effect of audit review probability on auditors' decision, because under a principle-based standard it is needed to reduce auditors aggressive reporting by the audit review of the supervisory authority. Therefore, this paper examines the effects of types of accounting standards (principle-based vs. rule-based) and audit review probability (high vs. low) on auditors' lease classification decision. In Korea, there are two kinds of accounting standards; (1) Korean-IFRS is for mainly publicly listed companies and (2) Korean-GAAP for unlisted companies. In lease classification provision, Korean-IFRS accepted principle-based approach like IFRS (major part of the economic life of the asset). However, Korean-GAAP is a rule-based standard (75% or more of the estimated economic life of the leased asset). In this study, Korean-IFRS is regarded as a principle-based standard, and Korean-GAAP is considered as a rule-based standard. This study conducted an experiment and collected the data by a questionnaire. Two treatment variables ((1) Type of accounting standards (principle-based vs. rules-based), (2) Audit review probability (high vs. low)) were manipulated as between-subject. Accordingly this experiment is designed with 4 groups. The dependent variable is measured as auditors' lease classification decision by 11-point scale. The subjects are auditors presently working at Big 4 accounting firms in Korea, and having at least three years’experience as auditors. The procedure of the experiment consists of 3 steps. In the first step, subjects responded the questions related to demographics and risk preferences. Next second step, the questionnaires provided a fictitious audit situation related to lease classification decision (capital lease or operating lease). The subjects were assumed as auditors of hypothetical company. And they were provided guidelines for classifying a lease, information about acquisition of a leased asset, and other conditions with regard to the hypothetical company. Additionally they were provided information about the impacts of different accounting treatments on the company's financial statements. After considering the case information, subjects responded their lease classification decision. In final step, subject completed questions for manipulation check. The analysis of results are as follows. First of all, subjects in a principle-based standard are significantly more likely to take aggressive position in classifying the leases than those under a rule-based standard. Second, under a higher audit review probability, subjects are more likely to decide aggressively, but this result is not statistically significant. In addition, by examining the consensus of the classification decision, under a principle-based standard, the tendency of different accounting treatment for same accounting transactions increases. Also,this tendency does not decrease by increasing audit review probability. The results above suggest the implications as follows. First of all, there is a need to include an additional standard within IFRS (including Korean-IFRS) to mitigate the aggressive financial decision of auditors or preparers. Also, by providing more detailed rule in current IFRS or by continuously educating auditors, the tendency for different accounting treatments for same transactions can be decreased.