Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1005088 | The International Journal of Accounting | 2013 | 30 Pages |
Abstract
We investigate whether the adoption of International Financial Reporting Standards (IFRS) in Greece affected tax-induced incentives for financial earnings management. Prior to the implementation of IFRS, there were powerful incentives for firms facing higher tax pressure to restrict (exacerbate) upward (downward) financial earnings management due to direct tax implications. IFRS adoption reduced book–tax conformity, thereby releasing financial income from tax implications. As expected, we find that tax pressure is a significant negative determinant of discretionary accruals in the pre-IFRS period. However, this effect dissipates under the new IFRS regime.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Accounting
Authors
Nikolaos I. Karampinis, Dimosthenis L. Hevas,