Type and activity of management are the main factors of effective operation and termination of business projects of a firm, leading to key determinants firm value. Since the type and activity of management are asymmetric information, a firm needs to design mechanism for screening and monitoring the management. Management entrenchment can restrain effective and timely termination of unprofitable business operations. This paper examines whether credit rating plays a role as an internal control device to facilitate expedite asset write-off while constraining management entrenchment and private benefit acquired from inefficient maintaining of unprofitable business operations. This paper shows clear evidence that credit rating controls management entrenchment for private benefits and expands voluntary asset write-off indicating effective termination of unprofitable business operations. In turn, this evidence provides implication that credit rating provides a mechanism controlling the management’s discretionary decision making and accounting reports for boosting up income number.