Articlehybrid2019

Do firms using real earnings management care about taxes? Evidence from a high book-tax conformity country

58 citations0/0 files storedFinance research letters

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Auditing, Earnings Management, Governance Corporate Taxation and Avoidance Corporate Governance and Financial Management

Abstract

Using a sample of 1,149 firm-year observations we show that benchmark-beating firms entering into real earnings manipulation are less willing to engage in aggressive tax planning. Controlling for a “normal level” of tax aggressiveness within the industry we provide evidence that average GAAP effective tax rate for benchmark-beaters is higher than for their industry peers. One of the possible reasons may be unwanted scrutiny by tax authorities and external monitors that hinders the real activities manipulation. All in all, our results suggest that real earnings management is even more costly than is widely considered.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 58 citations exist upstream.

References

2005Performance matched discretionary accrual measures 2003Earnings Management through Real Activities Manipulation 1997Earnings management to avoid earnings decreases and losses 2010A review of tax research 1998The Influence of Institutional Investors on Myopic R&D Investment Behavior 2011Evidence on the Trade-Off between Real Activities Manipulation and Accrual-Based Earnings Management 2007Are Family Firms More Tax Aggressive Than Non-Family Firms?2009Tax Reporting Aggressiveness and Its Relation to Aggressive Financial Reporting

Cited by

2023Tax avoidance and earnings management: a neural network approach for the largest European economies 2021Parallels and Differences in Earnings Management of the Visegrad Four and the Baltics 2023Financial attributes and corporate tax planning of listed manufacturing firms in Nigeria: moderating role of real earnings management 2021Blockholders and real earnings management-the emerging markets context 2022Internal corporate governance mechanisms and earnings manipulation practices in MENA countries

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.