Deferred Tax Assets Research Articles

MENGUAK EFEK PENURUNAN TARIF PAJAK PENGHASILAN DI MASA PANDEMI COVID-19

This article explains the effect of lowering income tax rates during the COVID-19 pandemic. The government's role in maintaining economic stability is carried out by issuing fiscal policies, in terms of taxation, namely by reducing the Corporate Income Tax rate. This research intends to find out the results of a decrease in corporate income tax rates affecting a decrease in current taxes deposited into the state treasury, a decrease in the total income tax burden, and recording in the income statement financial statements. The informants of this research are members of the Tax Rules Update Forum. This type of qualitative research uses a netnography approach. The reduction in current taxes deposited into the state treasury benefits the company by minimizing the costs incurred for the obligation to deposit state taxes. Companies that have deferred tax liabilities receive deferred tax benefits recorded in the balance sheet account, so the total income tax expense has decreased. In recording the income statement, the company has deferred tax assets adding to the deferred tax expense. Deferred tax expense in profit or loss account.

ACCOUNTING OF DEFERRED TAX ASSETS AND LIABILITIES: HISTORICAL EXCURSION AND MODERN REALITIES

The article considers the essence of deferred tax assets and liabilities and their reflection in the system of accounts and registers in the historical context. The periodization of the process of formation and development of the problem of deferred taxes in Ukraine with the use of normative and historical methods of cognition is carried out. The differences between permanent and temporary differences in tax profit (loss) and accounting profit (loss) are described. The approach to accounting for deferred taxes and their place in the reporting of enterprises using an algorithmic process is generalized. A detailed description of the current position of accounting for deferred taxes through the viewpoint of Ukrainian accounting standard 17 "Income Tax". Conclusions are made on the possibility of further research on the elimination of methodological difficulties in the allocation of certain tax differences to temporary or permanent.

The Effect of Tax Planning and Temporary Difference to Earnings Management

This study aims to analyze tax planning (tax planning is estimated using effective tax rate) motivations that push management (agent) to manage earnings and the ability of temporary difference accounts (measured by deferred tax assets, liabilities and expenses) to detect earnings management. Earnings management is estimated using the modified jones model. This study uses three independent variables to measure temporary difference, analyzes the effect of the independent variables towards the direction of earnings management and analyzes more than one industry so the results Samples used in this study are 377 non-financial public firms that are listed in the Indonesia Stock Exchange from 2015 until 2019, with a total of 1,832 observations. The data panel is processed using multiple linear regression using fixed effect model. The results of the study found only deferred tax liabilities has significant impact to earnings management and is able to detect earnings management upwards. Tax planning only effects absolute earnings management without specific direction. Deferred tax assets do not have a significant impact to detect earnings management downwards and deferred tax expense has no significant impact to earnings management but can potentially detect earnings management upwards in extreme cases.Deferred Tax Asset

Pengaruh Tax Retention Rate, Deferred Tax, Deferred Tax Assets, Dan Return On Assets Terhadap Earning Management

Earning Management is an action usually taken by managers to increase or decrease company profits in the current period following the goals and needs of the company. This study aims to examine the Tax Retention Rate, Deferred Tax, Deferred Tax Assets, and Return on Assets on Earning Management in Trade, Service, and Investment Sector companies listed on the Indonesia Stock Exchange for 2011-2018. The data used is secondary data. This research method is quantitative with a descriptive and verification approach. The population of this research is trading, service, and investment companies as many as 164 companies. The number of samples in this study was 11 companies which were determined using the nonprobability sampling method with purposive sampling technique; data collection was carried out through documentation and literature study. This study was tested using classical assumptions, multiple linear regression analysis, Pearson correlation coefficient test, coefficient of determination test, and hypothesis testing using a partial test (t-test) and simultaneous test (f test). Based on the research results on the t-test, the results obtained that the Tax Retention Rate has a significant negative effect on Earning Management where tcount is -4.945, greater than t-table is -1.992. Deferred Tax has no effect on Earning Management where the count of 0.732 is more minor than the t-table of 1.992. Deferred Tax Assets have no effect on Earning Management where a count of 0.261 is more minor than the t-table of -1.992. Return on Assets has no effect on Earning Management where a count of 1.238 is more significant than t-table of 1.992. Based on the research results on the f test, the results show that the Tax Retention Rate, Deferred Tax, Deferred Tax Assets, and Return on Assets simultaneously (together) affect Earning Management where the count value of 6.470 is more significant than the f-table of 2.46. The coefficient of determination concludes that the Tax Retention Rate, Deferred Tax, Deferred Tax, Deferred Tax Assets, and Return on Assets affect Earning Management by 23.8%. While the remaining 76.2% were influenced by other factors outside this research, such as good governance, free cash flow, leverage, and company size.

DEFERRED INCOME TAX: IMPACT ON FINANCIAL AND TAX REPORTING (THE PRACTIСE OF UKRAINE AND GERMANY)

Abstract. Income taxation is typical for most countries with their own peculiarities. In the practice of the Ukrainian enterprises, there is a lack of relationship between accounting and tax accounting to reflect the deferred tax asset and deferred tax liability in the reporting. The purpose of the article is to analyze the income tax in terms of its calculation by the international standards and identify key tax differences. The authors proposed to formulate the definitions of the current income tax which should be understood as the amount of income taxes payable (reimbursed) on taxable profit (tax loss) for the period and expenses (income) from income tax which should be understood as the total amount included in the determination of profit or loss for the period in accordance with current and deferred taxes. This interpretation of the definitions will help better understand the concepts in accounting and taxation. The tax base of assets and the tax base of liabilities are given and substantiated. The temporary differences were identified by authors. The example of definition of Deferred tax liabilities and Deferred tax assets, the order of their reflection in the report on financial results (about the total income) and disclosure in the Notes to the financial reporting is considered and analyzed. The impact on the indicators of the Income Tax Return is investigated. There is no direct impact of the amount of the Deferred tax assets / Deferred tax liabilities according to the current algorithm for the object of taxation, which is determined by tax legislation. The conclusions are made about the importance of determining of Deferred tax liabilities and Deferred tax assets, which directly affects the amount of net profit. The result of the study was confirmation of the hypothesis concerning different orientation of norms of the legal documents on the display of information in the forms of the financial and tax reporting. Such differences are related to the different requirement to the reporting by the modern stakeholders. Keywords: income tax, deferred tax, tax asset, tax liability, reporting. JEL Classification M40, М41, М48 Formulas: 0; fig.: 2; tabl.: 5; bibl.: 16.

The Effect of Deferred Tax Assets and Deferred Tax Expense on Earnings Management in Banking Sub-Sector Service Companies and Financing Institutions

This purpose of this research is to know The effect of Deferred Tax Asset and Deferred Tax Expense on Earning Management in service companies sub sector banking and financial institution listed at Indonesia Stock Exchange period 2013-2017.This research used quantitative and the data source is from secondary data. . The object in this study is service companies sub sector banking and financial institution listed at Indonesia Stock Exchange period 2013-2017, with total of population of 61 companies. From this population, 10 companies are chosen by purposive sampling technique throughout 5 periods of time, specifically from 2013-2017 which sum up to 50 samples. This analysis includes of descriptive statisticstest and the assumptions of regression analysis, classical hypotesis, multiple regression analysis , testing the hypothesis through a test of, t-test, F-test and determination coefficients. The analysis result obtained regression analysis Earning Management = -0.006 + 0.044 Deferred Tax Asset – 11.761 Deferred Tax Expense + e. Result of research partially indicate that Deferred Tax Asset has effect significantly to Earning Management with a value of the tcount > ttable of 3.316 > 2.01537 and significant value < 0.05 with value 0.002 < 0.05. As the result, the first hypotheses is accepted. Result of research partially indicate that Deferred Tax Expense not effect significantly to Earning Management with a value of the tcount < ttable of -2.338 < 2.01537 and significant value < 0.05 with value 0.024 < 0.05. As the result, the second hypotheses is accepted. The result of simultaneously Deferred Tax Asset and Deferred Tax Expense take effect and significantly to Earning Management with a value of Fcount > Ftable of 6.371 > 3.21 and significant value < 0.05 with value 0.004 < 0.05. As the result, the third hypotheses is accepted. This study hyphothesis results was supported by R Square value 22.9% which is indicates that the variable Earning Management can be explained by the variables of Deferred Tax Asset and Deferred Tax Expense, while the remaining 77.1% of Earning Management variable can be explained by other variables for example Tax Planning, Debt Rate and others which are not used in this study.

Features of accounting for deferred tax assets and deferred tax liabilities

Features of accounting for deferred tax assets and deferred tax liabilities

PENGARUH BEBAN PAJAK TANGGUHAN DAN AKTIVA PAJAK TANGGUHAN TERHADAP MANAJEMEN LABA PADA PERUSAHAAN PROPERTI DAN REAL ESTATE

Wirantika Cahya, The Effects of Deferred Tax Expenses and Deferred Tax Assets on Earnings Management in Property and Real Estate Companies in the 2014-2018 period on the Indonesia Stock Exchange. Under the guidance of Mrs. Siti Maryama, .SE, .MM. This study aims to examine and analyze the effect of deferred tax expense and deferred tax assets simultaneously on earnings management in property and real estate companies in the 2014-2018 period on the Indonesia Stock Exchange. The values tested in this thesis use the SPSS (Statistical Package for Social Science) program version 25.0, using a logistic regression analysis tool. the results of this study found that the deferred tax expense affects earnings management because the p-value of 0.039 is smaller than 0.05 and has a beta with a negative coefficient of -0.082, while the deferred tax assets do not affect earnings management because the p-value of 0.053 is greater than 0.05 and has a beta with a positive coefficient of 0.452. Keywords: Deferred Tax Expenses, Deferred Tax Assets, and Profit Management

Does Transfer Pricing Moderate the Effect of Deferred Tax Assets and Deferred Tax Expenses on Accrual Earnings Management of Firms in Indonesia?

The purpose of this study is to analyze (a) the effect of deferred tax assets on accrual earnings management; (b) the effect of deferred tax expenses on accrual earnings management; (c) the role of transfer pricing as a moderator variable to strengthen the effect of deferred tax assets on accrual earnings management; and (d) the role of transfer pricing as a moderator variable to strengthen the effect of deferred tax expenses on accrual earnings management. The samples consist of 160 manufacturing companies listed in Indonesia Stock Exchange (IDX). The study utilizes the financial statements from 2012 to 2018. This study presents that (a) deferred tax assets influence accrual earnings management; b) deferred tax expenses affect accrual earnings management; c) transfer pricing does not strengthen the effect of deferred tax assets on accrual earnings management; and d) transfer pricing does not strengthen the effect of deferred tax expenses on accrual earnings management. This study contributes to accounting studies, tax authorities and regulators, and accounting policy makers. Firstly, this research contributes to the development of accounting studies on the role of transfer pricing as a moderator of the effect of deferred tax assets and deferred tax liabilities on earnings management. Secondly, the results of this study can make a consideration for tax authorities and regulators in addressing company management actions to minimize the amount of tax paid by utilizing policies according to PSAK. It is worth considering how to sanction companies that deliberately reduce the amount of tax that should be paid. It is necessary to conduct tax investigation by the Directorate General of taxes on companies that are indicated to have practiced accrual earnings management with the aim of reducing the tax burden. Thirdly, accounting policy makers need to consider how management reduces the tax that should be paid through accounting policies that are allowed under PSAK and transfer pricing mechanism.

Pengaruh Deferred Tax, Capital Intensity dan Return On Asset terhadap Agresivitas Pajak

This research was conducted to identify the effect of Deferred Tax, Capital Intensity, and Return On Assets on Tax Aggressiveness in the coal mining sub-sector industry. This research uses a quantitative descriptive method. This paper uses secondary data from information that was obtained from the coal mining sub-sector listed on the Indonesia Stock Exchange in 2016-2019. The data collection method used purposive sampling. In this paper, there are several analysis used to process the data, which are, descriptive statistic analysis, correlation coefficient analysis, determination coefficient analysis, multiple linear regression analysis, significance test, and classical assumption test assisted by using Statistical Product and Service Solutions (SPSS) 23. The results of this research prove simultaneously. Deferred Tax Asset, Capital Intensity, and Return On Asset have a significant effect on tax aggressiveness, with the resulting significance value (0.006 <0.05). However, partially deferred tax assets do not have a significant effect on tax aggressiveness (0.365> 0.05), on the other hand, Capital Intensity is significant (0.001 <0.05), and Return On Asset has a negative significance(0.002 <0.05) effect to tax aggressiveness.
 Keywords : Deferred Tax Expense, Capital Intensity, Return On Asset, and Tax Aggressiveness

ВПЛИВ ПОДАТКОВИХ РІЗНИЦЬ НА ПОКАЗНИКИ ФІНАНСОВИХ РЕЗУЛЬТАТІВ СУБ’ЄКТІВ ГОСПОДАРЮВАННЯ: ІДЕНТИФІКАЦІЯ ТА ОБЛІК

The article establishes the measure and direction of the influence of tax differences on the indicators of financial results of business entities and outlines approaches to the construction of an adequate accounting mechanism for income tax collection processes. An analysis of the impact on the financial result of a number of tax differences arising from typical business transactions: accrual of depreciation, disposal of an object of fixed assets, etc. It was proved that in the economic space of Ukraine there was no completion of the processes of final implementation of the simplification of the determination of the object of taxation by income tax of legal entities by synchronizing the indicators of "accounting" and "tax" profit. Measures implemented with the introduction of the Tax Code to harmonize the regulatory framework of accounting and tax accounting for taxation of profits of enterprises were analyzed. Details are given of the characteristics of income recognition for tax purposes by date and special rules for income recognition after the abolition of the category "gross income". It was established that the implementation of tax legislation regarding financial results is carried out by means of recognition and response to the presence of tax differences. Today, there are differences in the accrual of depreciation of non-negotiable assets with respect to financial performance; differences from the formation of reserves and collateral, differences in transactions for the sale or disposal of securities; Differences from financial transactions. The article discloses the essence of methodological approaches to calculating tax differences for such operations. The conclusion is justified that crisis phenomena in the country's economy and the impact of the pandemic on the global economic space actualize the need to reflect not only real, but also potential assets and liabilities, in particular deferred tax assets and deferred tax liabilities. The introduction of new documentary forms of accounting for tax differences and separate income and expenditure accounts for tax purposes can also be considered as areas of improvement of income tax accounting.

Тестування системи обліку та внутрішнього контролю операцій з необоротними активами

Testing of the system of accounting and internal control of transactions with non-current assets was considered in the article. The objective of the article is to study the necessity, importance and position of testing in the assessment of accounting and internal control, as well as the presentation of the author's version of the test of transactions with non-current assets. This study was conducted using the historical method, methods of analysis, generalization, grouping and comparison. For better perception of the information and when testing the system of accounting and internal control of transactions with non-current assets the method of graphical representation was used. According to the study results it was found that testing procedures are important in assessing the company's accounting and internal control system. It has also been found that there is currently no single definition of "testing", which leads to inconsistencies and ambiguities in the use of this term. It was found that testing was used mainly during audits to identify "weaknesses", to adjust the audit process and to use specific procedures. Currently, the limits of the use of testing have expanded and are used in the overall assessment of accounting and internal control system, and to establish its effectiveness and feasibility. We have deepened our understanding of the assessment of internal control system through tests and tried to change the attitude to the testing system as an effective management tool. The presented test of assessment of the system of accounting and internal control of operations with non-current assets covers all stages of the "life cycle" of their certain types in the company. Prospects for further research are seen in the development of tests of accounting and internal control of certain non-current assets (intangible assets, work in progress, fixed assets, investment property, long-term biological assets, long-term financial investments, long-term receivables, deferred tax assets, other non-current assets) taking into account industry characteristics, types of economic activity, organizational and legal forms of economic entities.

Deferred Tax Accounting for SMEs: Modified Income Statement Approach

Purpose: Accounting for income tax under International Financial Reporting Standards (‘IFRS’) is dealt with in IAS 12 Income Taxes. It is often said that users of financial statements do not find information produced in accordance with IAS 12 useful. This is a serious problem because for many businesses tax is one of the largest expenses. In some cases, preparers find the requirements of IAS 12 difficult to apply in practice. Its requirements are said to be unclear, and preparers sometimes question the relevance and understandability of the information that is provided in accordance with the standard. The IFRS for SMEs currently require use of balance sheet approach for accounting of deferred taxes. In India, the Institute of Chartered Accountants of India (ICAI) – the apex standard-setting body in India, is formulating revised accounting standards for SME’s in India. This article examines an alternative to the balance sheet approach which is less complicated and easy to implement.[Reviewer1] [AB2] Methodology: This article proposes a new method i.e. Modified Income Statement Approach. This method is a mix of income statement approach and balance sheet approach, as it requires recognition of deferred taxes using temporary difference approach but calculated using income statement and the other comprehensive income (in effect, Comprehensive income statement). Modified Income Statement Approach requires comparison of tax expense with the underlying related income and expenses so that they are recognized in the same period. In doing so, it also considers income and expenses recognized in the income statement as well as the Other Comprehensive Income. Hence, this approach is more of temporary difference approach but applied by using income statement method. It covers all items of timing differences and most items of temporary differences. The SMEs have less complicated structures and transactions. Also, in many countries, including India, there exists no concept of tax balance sheet. Hence, it would be worthwhile to ease-out the deferred tax accounting for SMEs. The hypothesis is that application of modified income statement approach can result in similar outcome as the balance sheet approach.Findings: A survey of 50 top companies in India was conducted. The results show that 60% of the companies would have recognized the same deferred tax asset/ liability under both the methods i.e. modified income statement approach and balance sheet approach. Balance 40% had some minor differences, but such transactions may be less frequent for SME. On an average, the impact of using modified income approach as against balance sheet approach is a mere 4%. The only items not covered by the modified income statement approach as against the balance sheet approach are Fair valuation of assets/ liabilities on business combination, Compound financial instrument and the existence of undistributed profits of subsidiaries, branches, associates and joint arrangements[Reviewer3] .[AB4] Unique contribution to theory, practice and policy: [Reviewer5] [AB6] To balance out the cost and benefits of implementing an accounting standard as per the framework, it is critical that SME’s use a simpler and less complicated method which is easy to understand and implement. Modified income statement approach is easy to apply and not complicated or technical to understand. In India, companies are used to calculating deferred tax using income statement approach. Hence, this will be a small change from the existing approach, while achieving the objectives of the balance sheet approach. Hence, modified income statement approach seems to be an appropriate method for SMEs.

Foreign banks management in the context of a pandemic: problems and solutions

The article discusses the problems encountered by enterprises in the financial sector in the context of the COVID-19 pandemic. The paper gives examples of management actions of the largest banks in Italy, Brazil, South Korea, China, Portugal, Singapore, the USA, the Philippines and Russia. World Health Organization has advised the population to use contactless payments and reduce the turnover of banknotes to a minimum. The coronavirus has increased the desire of customers to use digital services, making it an urgent need. In fact, the pandemic has led to the fact that Bank customers, who are increasingly afraid to spend time in public places, should be able to conduct banking operations without physical interaction with Bank offices. By implementing fully digital remote customer service, banks must ensure that both routine and unique (one-time, specific) banking processes will be performed without loss or disruption. Under these circumstances, financial institutions will be required to disclose information about the impact of the coronavirus pandemic on their operations in financial statements based on the relevant disclosure standards (Generally Accepted Accounting Principles, GAAP and United States Securities and Exchange Commission, SEC). Disclosure of financial statements may include risk factors such as Fund depreciation, reduced liquidity, and other aspects.The downward trend in interest rates as required by governments and national banking regulators may affect the profitability of banks. Along with a General decline in business activity, this will lead to a decrease in Bank profits. Analysts’ concerns have already resulted in a sharp drop in the share prices of many firms, which creates another problem because some deferred tax assets, such as net operating losses (NOL), are not fully accounted for in the Bank’s regulatory capital requirements. National governments impose industry-specific tax requirements on capital market enterprises, but the challenges they will face when filing and paying direct and indirect taxes are likely to be similar to those faced by other industries.

Pajak Kini, Pajak Tangguhan, Aset Pajak Tangguhan, Liabilitas Pajak Tangguhan Terhadap Manajemen Laba

The purpose of this study was to examine whether there is an effect of current tax expense, deferred tax, deferred tax assets, and deferred tax liability on earnings management actions in consumer goods companies listed on the Indonesia Stock Exchange (IDX). This study's sample consisted of 27 consumer goods industries listed on the Indonesia Stock Exchange in 2013-2017 using the purposive sampling method. Hypothesis testing in this study using the t-test. Earnings management is proxied by discretionary accruals using the Modified Jones Model. The type of data used is secondary data. Data analysis used OLS (regression equation analysis ordinary least square). The results show that the current tax has a significant effect on earnings management variables. The deferred tax affects earnings management, deferred tax assets affect earnings management, and deferred tax liabilities have no effect on earnings management. Research limitations The sample of companies used is considered less representative of the population because only manufacturing companies are used consumer goods. The research period in measuring earnings management variables is proxied by discretionary accruals for only five consecutive years, according to Jones (1991). profit can be seen if the research period is carried out for eight years. In this study, it is suggested that the research period used can be added, and the sample used can be extended to other company sectors and other measures of earnings management by using proxies.

The Effects of the Tax Cuts and Jobs Act of 2017 on Defined Benefit Pension Contributions*

ABSTRACTThis study examines the effect of the Tax Cuts and Jobs Act of 2017 (TCJA) on corporate defined benefit pension contributions. The TCJA decreases the corporate tax rate from 35 percent in 2017 to 21 percent in 2018 and thereafter. This change incentivizes firms to increase 2017 pension contributions to take advantage of tax deductions at a higher rate. Consistent with this incentive, we find firms increase defined benefit pension contributions by an average of 25 to 31 percent in 2017 compared with earlier years. We also find that taxpaying firms are the primary contributors. Further, taxpaying firms with high levels of pension‐related deferred tax assets contribute over three times as much as taxpaying firms with low levels of pension‐related deferred tax assets. We also find firms that increase pension contributions in 2017 reduce 2018 contributions, consistent with intertemporal income shifting rather than a permanent change in pension funding strategy.

Deferred Tax Asset Valuation Allowances and Auditors’ Going Concern Evaluations

The valuation allowance for deferred tax assets is an audited disclosure that reflects management’s expectations regarding the future profitability of a company. Building on prior literature that establishes this disclosure as an indicator of future distress, we examine whether the valuation allowance is associated with auditors’ going concern evaluations. We find evidence that the existence and magnitude of the valuation allowance, as well as changes in the allowance, are positively associated with the likelihood that a company receives a going concern opinion. We also find that valuation allowances are associated with reduced Type I and Type II going concern opinion errors. Our results suggest that the information related to management’s plans and expectations that is reflected in the valuation allowance is viewed as incrementally relevant by auditors in their assessment of a company’s likelihood of failure.

Taxes and IPO Pricing: Evidence from U.S. Tax Reform

This study examines when and how tax reform impacts the pricing of IPOs. Using the Tax Cuts and Jobs Act of 2017 (TCJA), we examine IPO pricing during the periods of anticipated and post-tax reform. First, we document that firms completing an IPO following the passage of the TCJA experience an increase in valuation. The increase in valuation is significantly lower for firms with net deferred tax assets and U.S. based multinational firms, consistent with those firms benefiting less from the reform. Second, we fail to document an increase in valuation for firms completing their IPO during the period of anticipated tax reform. We further observe that firms did not experience an increased probability of an upward pricing revision during the book-building process during this period, suggesting that the IPO market was unwilling to impound the benefits of anticipated tax reform into offer prices until enactment. This result contrasts with research on the pricing of tax reform for existing publicly traded stock, where prices impound the anticipated benefits from tax reform, far in advance of enactment.

Value relevance of deferred tax assets in the Brazilian banking industry

ABSTRACT This study aimed to investigate the informational relevance to the capital market of the significant level of deferred tax assets (DTAs) in the Brazilian banking industry, identifying whether such assets influence the market value of publicly-held banks. The value relevance of DTAs in the banking industry is an incipient topic in the national literature, with conflicting results in the international research. Brazil presents characteristics, most notably regarding the dimension of the asymmetries between accounting and taxable profit, which justify concern about the effects of DTAs on the market value of banks. The literature highlights issues involving DTAs related to their ability to generate economic benefits and control of the entity, especially in the banking industry, due to not fulfilling the role of financial intermediation, which would make them devoid of economic substance. This would signal potential bank risks and weaknesses, such as a reduction in the quality of equity and profits, in addition to distortions in the economic-financial indicators, which would justify a negative perception on the part of investors. As the study’s main contribution to the literature, we can highlight the identification that in the Brazilian market, the asymmetries between banks’ taxable and corporate earnings, the origin of deferred tax assets, weigh negatively on the market value of these institutions. We empirically tested the hypothesis in the Brazilian capital market, using data from 2000 to 2017 on publicly-held banks, by estimating two models - Market-to-Book and Ohlson (1995). The results of this study show that in the Brazilian capital market there is a negative relationship between the volume of the banks’ DTAs and the market value of these entities, corroborating the hypothesis that investors identify the relevance of these assets in the equity structure as a sign of the quality of the equity and the profit of these entities being undermined.

Finansijsko izveštavanje o porezu na dobitak u Srbiji i Hrvatskoj - empirijska analiza

The paper examines the quality of financial reporting on income tax in Serbia and Croatia in order to determine the extent to which disclosed information on income tax in these countries is useful for economic decision making. The research based on financial statements of listed and non-listed companies for 2016 reveals that disclosed information on the income tax is not entirely in accordance with the relevant regulation. Therefore, there is a significant room for improvement of income tax financial reporting practices in both countries. The quality of disclosed income tax information is not related to the presence of companies in the stock market, as capital markets in Serbia and Croatia do not provide strong incentives for disclosing adequate information on income tax. The research also reveals significant differences in the prevailing sources of deferred tax assets and deferred tax liabilities between Serbia and Croatia, which indicates that the income tax financial reporting is conditioned by the specifics of the national environment.