Tax Avoidance Role in Asymmetric Timeliness from Accounting Conservatism Theory

• In Event: Research Paper Session—FARS-1

Abstract

This paper examines the role of tax avoidance in the currently believed accounting conservatism. This study findings that off-sheet tax avoidance can also cause companies look “conservative” in accounting. The findings provide a contradictory view of the asymmetric recognition timeliness to the current literature. The current literature believes that the asymmetry is caused by the accounting prudence, or accounting conservatism, but this study argues that such asymmetry can also be caused by tax avoidance aggressiveness.

Author

• Xiaosi Liu, Kent State University