Universitas Bhayangkara Jakarta Raya

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Machdar, Nera Marinda (2022) Does Tax Avoidance, Deferred Tax Expenses and Deferred Tax Liabilities Affect Real Earnings Management: Evidence from Indonesia? Institutions and Economies, 14 (2). pp. 117-148. ISSN 2232 - 1349,

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Abstract

The study analyses the effect of tax avoidance, deferred tax expenses and deferred tax liabilities on real earnings management. The samples consist of 152 manufacturing companies listed on the Indonesian Stock Exchange (IDX). The study examines the financial statements from 2011 to 2019, ending up with 1,368 observations. The empirical results of this study are as follows. First, tax avoidance affects positively the abnormal discretionary operating cash flows and the abnormal discretionary expenses. However, tax avoidance does not affect the abnormal discretionary production costs. Second, deferred tax expenses affect real earnings management positively, either through abnormal discretionary operating cash flows, abnormal discretionary expenses, or abnormal discretionary production costs. Third, deferred tax liabilities affect real earnings management positively, either by using abnormal discretionary operating cash flows, abnormal discretionary expenses, or abnormal discretionary production costs. The findings of this study may be of interest to regulators and tax authorities, as they highlight how to increase the actual amount of tax payments by reducing the occurrence of real earnings management activities. Regulators need to consider tax audits on companies that have suffered losses but are still operating. Keywords: Tax avoidance; Deferred tax expenses; Deferred tax liabilities; Real earnings management. JEL Classification: H21, H32, M41

Item Type:	Article
Subjects:	Ilmu Sosial > Ekonomi > Akuntansi
Divisions:	Fakultas Ekonomi dan Bisnis > Akuntansi
Depositing User:	Prof Nera Marinda Machdar
Date Deposited:	13 Apr 2023 02:50
Last Modified:	13 Apr 2023 02:50
URI:	http://repository.ubharajaya.ac.id/id/eprint/20454

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