The Effect of Corporate Tax Policy Reforms on Earnings Management and Financial Reporting Practices

Posted: Sep 29, 2012

• Luna Torres
• Maria Allen
• Maria Carter

Abstract

The relationship between corporate taxation and financial reporting represents a fundamental area of inquiry in accounting and finance research. Traditional scholarship has extensively documented how firms engage in earnings management to achieve various objectives, including tax minimization, meeting analyst expectations, and influencing executive compensation outcomes. However, the dynamic interplay between tax policy reforms and the evolution of financial reporting practices remains inadequately understood through conventional analytical frameworks. This research addresses this gap by introducing a novel computational methodology that transcends the limitations of traditional econometric approaches.