세수부족과 이익조정 간의 관련성에 관한 연구

This study examines the association between the lack of tax revenue and earnings management. Recently, the shortfall in tax revenue happened for three straight years in Korea. In general, the shortfall in tax revenue leads to the aggressive management of tax revenue from tax authority in order to supplement taxation. It may also increase the likelihood of the tax investigation around firms. For this reason, managers’ incentives which manage earnings will be reduced to avoid additional tax penalty. Therefore, it is expected that manager’s earnings management can be affected by the lack of tax revenue. To analyze this expectation, this study uses 5,698 firm-year observations listed on KOSPI form 2004 to 2014 period, and collects the data which is the collection of national taxes from Statistics Korea. As the empirical finding, we find that the lack of tax revenue is negatively associated with earnings management, which is consistent with our hypothesis. It means that earnings management decreased in the year of a shortfall in tax revenue compared to other years. Because manager perceives that the lack of tax revenue leads to the aggressive tax collection from tax authority and increases the likelihood of firm’s tax investigation, they want to avoid the tax penalty from earnings management. Furthermore, the empirical result of this paper shows that the aggressive management of tax revenue due to the shortfall in tax revenue can affect the firm’s accounting policy. Our result has the following implication. So far, there were no research to examine the relationship between the lack of tax revenue and earnings management. Therefore, our finding will give broaden perspective to stakeholders, tax authority, and regulator in understanding manager’s financial reporting behavior as a change in the taxation environment.