IDEAS home Printed from https://ideas.repec.org/a/rbs/ijbrss/v9y2020i7p167-176.html
   My bibliography  Save this article

The effect of financial distress and earnings management on tax aggressiveness with corporate governance as the moderating variable

Author

Listed:
  • Ratih Pujirahayu Nugroho

    (Accouting Department, Faculty of Economics and Business, Universitas of Brawijaya, Indonesia)

  • Sutrisno T Sutrisno

    (Accouting Department, Faculty of Economics and Business, Universitas of Brawijaya, Indonesia)

  • Endang Mardiati

    (Accouting Department, Faculty of Economics and Business, Universitas of Brawijaya, Indonesia)

Abstract

This study aims to verify the correlation between financial distress and earnings management of tax aggressiveness moderated by corporate governance. This study uses a population of manufacturing companies that publish their financial statement on the Indonesia Stock Exchange from 2017 until 2018. Sample collection was performed using a purposive sampling method, resulting in a total of 212 populations that published complete financial reports. This study was tested by using the Multiple Regression Analysis test. This research gave empirical proofs that financial distress and real earnings management positively influenced the tax aggressiveness was supported, the proportion of independent commissioners weakened the financial distress and negatively impacted the tax aggressiveness was supported, the total audit committees weakened the financial distress and negatively influenced the tax aggressiveness was not supported, the proportion of independent commissioners and total audit committees weakened the real earnings management and negatively affected the tax aggressiveness was not supported. Key Words: Financial Distress, Earnings Management, Tax Aggressiveness, Corporate Governance

Suggested Citation

  • Ratih Pujirahayu Nugroho & Sutrisno T Sutrisno & Endang Mardiati, 2020. "The effect of financial distress and earnings management on tax aggressiveness with corporate governance as the moderating variable," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 9(7), pages 167-176, December.
    • Handle: RePEc:rbs:ijbrss:v:9:y:2020:i:7:p:167-176
    DOI: 10.20525/ijrbs.v9i7.965
    as

    Download full text from publisher

    File URL: https://www.ssbfnet.com/ojs/index.php/ijrbs/article/view/965/731
    Download Restriction: no
    File URL: https://doi.org/10.20525/ijrbs.v9i7.965
    Download Restriction: no
    File URL: https://libkey.io/10.20525/ijrbs.v9i7.965?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Richardson, Grant & Taylor, Grantley & Lanis, Roman, 2015. "The impact of financial distress on corporate tax avoidance spanning the global financial crisis: Evidence from Australia," Economic Modelling, Elsevier, vol. 44(C), pages 44-53.
    2. Henny Rakhmawati & Sutrisno T & M. Khoiru Rusydi, 2020. "Influenceof TAM and UTAUT models of the use of e-filing on tax compliance," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 9(1), pages 106-111, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Athira, A. & Ramesh, Vishnu K., 2023. "COVID-19 and corporate tax avoidance: International evidence," International Business Review, Elsevier, vol. 32(4).
    2. Badar Alshabibi & Shanmuga Pria & Khaled Hussainey, 2022. "Nationality Diversity in Corporate Boards and Tax Avoidance: Evidence from Oman," Administrative Sciences, MDPI, vol. 12(3), pages 1-12, August.
    3. Habib Saragih, Arfah & Ali, Syaiful & Suwardi, Eko & Utomo, Hargo, 2024. "Finding the missing pieces to an optimal corporate tax savings: Information technology governance and internal information quality," International Journal of Accounting Information Systems, Elsevier, vol. 52(C).
    4. Li, Jianjun & Wu, Zhouyi & Feng, Lingbing, 2024. "How does environmental regulation affect corporate tax burdens? Evidence from China's environmental courts," Economic Modelling, Elsevier, vol. 130(C).
    5. ElBannan, Mona A., 2021. "On the prediction of financial distress in emerging markets: What matters more? Empirical evidence from Arab spring countries," Emerging Markets Review, Elsevier, vol. 47(C).
    6. José M Durán‐Cabré & Alejandro Esteller‐Moré & Luca Salvadori, 2020. "Cyclical Tax Enforcement," Economic Inquiry, Western Economic Association International, vol. 58(4), pages 1874-1893, October.
    7. Lai, Fujun & Xiong, Deping & Zhu, Sha & Li, Yunzhong & Tan, Yanzhi, 2023. "Will geopolitical risks only inhibit corporate investment? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 82(C).
    8. Ji-Hye Kim & Eungoo Kang, 2023. "An Empirical Research: Incorporation of User Innovativeness into TAM and UTAUT in Adopting a Golf App," Sustainability, MDPI, vol. 15(10), pages 1-22, May.
    9. Fatemeh Mohammad Ebrahimzadeh Sepasgozar & Usef Ramzani & Sabbar Ebrahimzadeh & Sharifeh Sargolzae & Samad Sepasgozar, 2020. "Technology Acceptance in e-Governance: A Case of a Finance Organization," JRFM, MDPI, vol. 13(7), pages 1-17, June.
    10. Zhang, Zili & Wang, Zeyu & Si, Yanwu & Li, Tianyang, 2023. "Administrative monopoly regulation and corporate tax avoidance - evidence from China," Finance Research Letters, Elsevier, vol. 58(PB).
    11. Benkraiem, Ramzi & Gaaya, Safa & Lakhal, Faten, 2022. "Corporate tax avoidance, economic policy uncertainty, and the value of excess cash: International evidence," Economic Modelling, Elsevier, vol. 108(C).
    12. Ferchichi Jihene & Dabboussi Moez, 2019. "The Moderating Effect of Audit Quality on CEO Compensation and Tax Avoidance: Evidence from Tunisian Context," International Journal of Economics and Financial Issues, Econjournals, vol. 9(1), pages 131-139.
    13. Christofer Adrian & Mukesh Garg & Anh Viet Pham & Soon-Yeow Phang & Cameron Truong, 2023. "Do Natural Disasters Affect Corporate Tax Avoidance? The Case of Drought," Journal of Business Ethics, Springer, vol. 186(1), pages 105-135, August.
    14. Zhu, Jun & Ho, Kung-Cheng & Luo, Sijia & Peng, Langchuan, 2023. "Pandemic and tax avoidance: Cross-country evidence," Economic Modelling, Elsevier, vol. 124(C).
    15. Galmandakh Urlee & Sumjidmaa Tumurchudur & Oyuntungalag Buyantur, 2024. "Analysis of the Effect of the Tax Electronic System on Tax Paying Behavior," International Journal of Science and Business, IJSAB International, vol. 37(1), pages 84-95.
    16. Geng, Yong & Liu, Wei & Li, Kai & Chen, Hanshu, 2021. "Environmental regulation and corporate tax avoidance: A quasi-natural experiment based on the eleventh Five-Year Plan in China," Energy Economics, Elsevier, vol. 99(C).
    17. Fatica, Serena & Gregori, Wildmer Daniel, 2020. "How much profit shifting do European banks do?," Economic Modelling, Elsevier, vol. 90(C), pages 536-551.
    18. Dhawan, Anirudh & Ma, Liangbo & Kim, Maria H., 2020. "Effect of corporate tax avoidance activities on firm bankruptcy risk," Journal of Contemporary Accounting and Economics, Elsevier, vol. 16(2).
    19. Benkraiem, Ramzi & Uyar, Ali & Kilic, Merve & Schneider, Friedrich, 2021. "Ethical behavior, auditing strength, and tax evasion: A worldwide perspective," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 43(C).
    20. Athira, A. & Lukose, P.J. Jijo, 2023. "Do common institutional owners' activisms deter tax avoidance? Evidence from an emerging economy," Pacific-Basin Finance Journal, Elsevier, vol. 80(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rbs:ijbrss:v:9:y:2020:i:7:p:167-176. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Umit Hacioglu (email available below). General contact details of provider: https://edirc.repec.org/data/ssbffea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.