Purpose - This study verifies whether a high management risk occurs in companies with high information asymmetry or high financial constraints. Moreover, it examines whether such factors intensify the decrease of effective tax rates according to management risk. Design/Methodology/Approach - The sample taken for this study includes 3,372 firm-year observations. The sample employed herein was obtained from firms listed on the Korean Stock Exchange (KSE) from 2011 to 2019. Findings - The results of the analysis are as follows. First, a firm’s high information asymmetry level has a positive relation with its management risk. Second, a firm’s high financial constraint level is positively related to its management risk. Third, a negative relationship between management risk and effective tax rates is intensified in firms with high information asymmetry. Fourth, results indicate that a negative relationship between management risk and effective tax rates is intensified in firms with high financial constraint. Research Implications - This study encourages companies in terms of developing strategies to lower management risks. A firm’s risk can be higher when detected by tax authorities, even if it has lower management risks through tax reduction. This study thus provides important implications for tax strategies to reduce management risk in cases of companies with high information asymmetry or high financial constraints.