wawa外文文献翻译
2011 届
译文一:企业税收筹划的有效性:基于对报酬的激励作用(上)
译文二:stevie hoang企业税收筹划的有效性:基于对报酬的激励作用(下)
daerduo
学生姓名 crest 周伟
学 号 ********
院 系 经济与管理学院 2012世界大学排名
专 业 会计
指导教师 许庆高
完成日期 2010年12月2日
Corporate Tax-Planning Effectiveness: The Role of Compensation-Bad Incentives (Ⅰ)
John D. Phillips University of Connecticut
ABSTRACT
This study investigates whether compensating chief executive officers and business-unit managers using after-tax accounting-bad performance measures leads to lower effective tax rates, the empirical surrogate ud for tax-planning effectiveness. Utilizing proprietary compensation data obtained in a survey of corporate executives, the relation
between effective tax rates and after-tax performance measures is modeled and estimated using a two-step approach that corrects for the endogeneity bias associated with firms' decisions to compensate managers on a pre- versus after-tax basis. The results are consistent with the hypothesis that compensating business-unit managers, but not chief executive officers, on an after-tax basis leads to lower effective tax rates.
KEYWORDS 考研英语复习计划 tax planning; 倒装句performance measures; endogenous treatment effects.
I. INTRODUCTION
Ebodylotionffective tax planning, defined by Scholes et al. (2002) as tax planning that maximizes the firm's expected discounted after-tax cash flows, requires managers to consider their decisions' after-tax conquences. In this paper, I investigate whether after-tax accounting-bad performance measures lead to lower effective tax rates (ETR), my empirical surrogate for tax planning effectiveness.1 The ETR, an income-statement-bad outcome measure calculated as the ratio of total income tax expen to pre-tax income, generally measures the effectiveness of tax reduction strategies that lead to high
er after-tax income. A lower ETR, however, can only proxy for tax savings and does not always imply that after-tax income and/or cash flows have been maximized.2 Despite this limitation, the ETR has been ud to measure the effectiveness of spending on the tax function (Mills et al. 1998) and corporate tax department performance (Douglas et al. 1996). Also, lowering the ETR is frequently cited as a way to increa earnings (e.g., Ziegler 1997) and increa share price (e.g., Mintz 1999; Swenson 1999).
Accounting rearch has addresd the relation between accounting-bad compensation and managers' actions (e.g., Larcker 1983; Healy 1985; Wallace 1997). This paper is the first to address whether after-tax accounting-bad performance measures motivate managers to take actions that help lower their firms' ETR and does so at both the chief executive officer (CEO) and business-unit (SBU) manager levels. Prior after-tax performance measure rearch has focud only on the determinants of compensation CEOs using pre- versus after-tax earnings (e.g., Newman 1989; Carnes and Guffey 2000; Atwood et al. 1998; Dhaliwal et al. 2000) and provides no evidence concerning after-tax compensation's effectiveness in lowering a firm's tax liability. Extendimenstrual
ng this investigation to the S悉尼奥运会歌曲BU level is motivated out of the apparent conflict between arguments that taxes should be allocated to SBU for incentive compensation purpos (e.g., McLemore 1997) with empirical obrvations that a majority of firms do not do so (e.g., Douglas et al. 1996).4 The current investigation provides evidence concerning the incremental effectiveness of explicitly motivating CEOs and SBU managers to incorporate tax conquences into their operating and investment decisions.
A common issue in cross-ctional studies that attempt to link a particular management accounting choice to an outcome measure is that all sample firms may be optimizing with respect to the choice being investigated (Ittner and Larcker 2001). Without addressing the endogeneity of a firm's choice, it is difficult to provide evidence consistent with this choice leading to an improved outcome. To address this issue, the relation between ETR and CEO and SBU-manager after-tax performance measures is estimated using a two-step approach that helps correct for the potential endogeneity bias associated with the two choice variables. As a first step in implementing this approach, the Antle and Demski (1988) controllability principle is ud to model a firm's decisions to adopt after-tax CEO a
nd SBU-manager performance measures. To include a particular measure in a manager's compensation contract, this principle requires that the expected benefits from holding a manager responsible for a measure must be greater than the additional wage that must be paid to compensate the manager for the resulting additional risk and effort. Accordingly, an after- tax performance measure should be ud as a contracting variable in a manager's incentive compensation contract only if the manager's involvement in tax-planning efforts leads to a difference between pre-tax and after-tax accounting results, which is generally reflected in the ETR. Consistent with prior rearch, the pre- versus after-tax CEO and SBU-manager lection models include variables that control for a firm's tax-planning opportunities becau the prence of such opportunities reflect the extent to which a manager's actions can be expected to lower the ETR.