We examine whether voluntary, cooperative tax audits are associated with incrementally greater corporate tax compliance and positive spillover to financial reporting quality relative to enforced, adversarial tax audits. Extant literature lacks a direct comparison of these options, which both...

We analyze whether tough IRS monitoring generates a positive externality by constraining managers' bad news hoarding activities. Supporting this prediction, we find a negative relation between the threat of an IRS audit and stock price crash risk. Our evidence is consistent with recent theory...

We examine the financial statement disclosures that accompany settlements of uncertain tax benefits (UTB) to explore how managers reflect this information into their underlying probability assessments and thus future estimates of UTB reserves. We use textual analysis to develop a measure of the...

In measuring tunneling with inter-corporate loans disclosed by Chinese listed companies, we analyze the underlying channels through which aggressive tax planning facilitates the diversion of corporate resources by firm insiders. Using path analysis, we document that the path from tax...

We exploit changes in a country's integration of corporate and shareholder taxes to identify the effect of investor-level taxes on costly corporate tax avoidance. Specifically, we rely on European countries eliminating imputation systems in different years in response to supranational judicial...

We examine the financial statement disclosures that accompany settlements of uncertain tax benefits (UTB) to explore the market reaction to disclosure through tabular format and qualitative description. We use textual analysis to develop a measure of the similarity between tax footnotes and a...

We examine whether “kiddie tax” legislation in Canada, effective as of 2000, deters income splitting between parents and minor children by taxing at the top marginal rate certain types of non-labour income received by children. OLS estimates based on cross-province and time-series data...

In July 2013, the International Accounting Standards Board (IASB) welcomed comments to their discussion paper A Review of the Conceptual Framework for Financial Reporting. We argue that the IASB should revisit its decisions about the concepts of reliability and prudence, to address the inherent...