이연법인세와 경영자 이익조정

This paper empirically explores whether the application of deferred tax accounting gives the management an additional incentive to eliminate potential deferred tax accounting effects, which would increase or decrease net income without affecting cash flows before and after the application of deferred tax accounting periods. The modified Jones Model is employed to compute the discretionary accruals during the period of 6 years, 3 years each before and after the application of deferred tax accounting. Sample firms are divided into four different groups distinguished by the application of deferred tax accounting and the pre and post periods of deferred tax accounting. The results of multiple regression analysis show significant differences in discretionary accruals between the pre and post application periods of deferred tax accounting. For further analysis, sample firms that have applied the deferred tax accounting are divided, ex post, based on the direction of earnings management, i.e. income-increasing incentive or income-decreasing incentive. The regression analysis takes an income increasing incentive, an income decreasing incentive, and interactions between the deferred tax and earnings management incentives as relevant dummy variables. The result shows the significant statistics of the dummy variables. As such, this paper suggests that besides the earnings management prior to the application of deferred tax accounting, additional earnings management would take place. For standard setters and regulators who are likely to be interested in evidence on (1) specific accruals and methods used to manage earnings, and (2) the magnitude and frequency of any earnings management, this paper will thereof provide a clear evidence of earnings management.