Pre-tax Profit Research Articles

Assessing the impact of environmental component on the development of Russian banks applying ESG policy

Subject. The article discusses operations of steadily developing Russian banks in the context of environmental component. Objectives. The aim is to identify patterns in functioning of Russian banks, applying ESG policy in their activities, under the influence of environmental factors, to improve the management of their development. Methods. The study employs regression analysis. We selected 26 Russian banks based on ESG ratings, formed an empirical base for 2011–2020 from open sources (financial and economic indicators and macro-level indicators characterizing the environmental impact by the activities of economic entities), built a linear regression model in MS Excel. Results. The constructed regression model helped reveal that the indicator “Recycling and disposal of production and consumption waste in the Russian Federation” has a significant positive impact on the pretax profit of banks applying ESG policy. However, a negative trend in the impact of banks on the environment was identified in terms of connection between the resulting indicator and the indicator “Primary energy intensity level”. This suggests that the internal capacity of banks to implement the environmental component is not sufficiently developed and used. Conclusions. The findings can be used both at the macro and micro level when generating the strategy and tactics for ESG banking development. The offered regression modeling technique can be used to analyze the role of environmental component in the activities of banks in other countries, which implement ESG policy.

Analyzing Trends in Key Financial Indicators: A Case Study on ORION Pharma Limited

This descriptive research study aims to examine the performance trends of ORION Pharma Limited within the context of its operations in Bangladesh. The study is based on secondary data extracted from annual reports spanning from FY 2018-19 to 2022-23 of the chosen company. It employs trend percentage analysis on key financial metrics derived from these reports. Firstly, the analysis focuses on fluctuations in key financial indicators of the statement of profit or loss, such as net sales revenue, gross profit, operating profit, pre-tax profit, and post-tax profit. Despite facing challenges, the company has shown resilience and adaptability, showcasing noticeable recoveries and improvements during different periods. These changes reflect ORION Pharma's responsiveness to market conditions and efforts to manage expenses efficiently. The analysis suggests opportunities for strategic expansions and profit enhancements despite occasional setbacks. Secondly, examining the trend percentage of key metrics of the statement of financial position for ORION Pharma, the study shows consistent growth in total assets, driven by expansions in both current and non-current assets. Though liabilities increased notably, total equity showed positive growth, indicating effective management and sustained profitability. In summary, ORION Pharma demonstrates strong financial performance and strategic planning, positioning it for continued growth and profitability.

Analysis of the Relationship Between the Factors of Enterprises Foreign Economic Activity and Tax Revenues to Regional Budgets

The article analyzes the main factors of foreign economic activity, which can affect the results of basic indicators values of the industrial enterprises main activity. The direct mathematical dependence between the change in revenues from export sales and the dynamics of profit indicators before taxation and value added of sold products is revealed. A few data on the structure of costs and starting values of organizations’ incomes, which are necessary for the forecast analysis, are listed. The direct dependence between the performance indicators of enterprises and revenues to the regions tax budgets depending on the nature of the foreign economic factor that affects export revenues is substantiated. The purpose of the analysis is to create a tool for forecasting changes in pre-tax profit and value added under the influence of changing prices and sales volumes on foreign markets. The created model contains four final formulas, which were expressed using the generally accepted theory of financial management with the addition of new indicators for the non-standard situations analysis. The presented technology of forecasting the dynamics of tax revenues (based on changes in the indicators that are their tax base) can be used by analytical bodies of regional authorities to assess the consequences of the foreign economic risks implementation and develop recommendations for the federal budget to reallocate funds for support the expenditures of those subjects of the federation, which will experience the most pronounced impact of this phenomenon.

Analisis Koreksi Fiskal Atas Laporan Keuangan Komersial Untuk Menghitung PPH Badan Terutang Pada PT Yoezhadassah

To find out whether the fiscal correction made by PT Yoezhadassah is in accordance with the applicable tax law and to find out the effect of fiscal corrections made on commercial financial statements on Corporate Income Tax payable at PT Yoezhadassah. The type of research used is qualitative using the exploration method, which is to describe a situation about to get saturated answers regarding fiscal corrections on commercial reports and the preparation of fiscal financial statements and the calculation of Corporate Income Tax at PT Yoezhadassah. Data obtained by researchers through in-depth interviews as well as documentation and observation studies. The results showed that the fiscal correction of the 2021 financial statements of PT Yoezhadassah was carried out through a negative fiscal correction of income of IDR 38,226,905,190 and expenses of IDR 39,661,451,100 on the company's income statement so that the company, which initially according to the commercial income statement, suffered a pre-tax loss of IDR 1,343,629,518 on the fiscal financial statements, resulted in a pre-tax profit of IDR 103,198,00. Corporation income tax payable by PT Yoezhadassah in 2021 is calculated based on profit from non-final income, namely income from transportation minus costs related to transportation. Corporate income tax payable in 2021 of PT Yoezhadassah after fiscal correction is IDR 21,287,761. PT Yoezhadassah in making fiscal corrections to income and expenses is in accordance with applicable tax laws. Based on the results of existing research, the advice that can be given to PT. Yoezhadassah is that as a taxpayer who earns income subject to final and non-final tax, it is advisable to make separate financial statements for final and non-final income so that the tax calculation can be done correctly. PT Yoezhadassah continues to pay attention to the recognition of costs and revenues that are final and non-final.

Switchable catalysis for methanol and synthetic natural gas synthesis from CO2: A techno-economic investigation

The oil and gas sector produces a considerable volume of greenhouse gas emissions, mainly generated from flaring and venting natural gas. Herein, a techno-economic analysis has been performed of a switchable catalytic process to convert the CH4 and CO2 in flared/vented natural gas into syngas or methanol. Specifically, it was shown that depending on greenhouse gas composition, dry methane reforming (DRM), reverse water-gas shift (RWGS), and CO2 methanation could be chosen to valorise emissions in an overall profitable and flexible operation scenario. The switchable process produced methanol and synthetic natural gas as its products, resulting in an annual income of €687m and annual operating expenses of €452m. The pre-tax profit was calculated at €234m, and at the end of the project, the net present value was calculated as €1.9b with a profitability index of 4.7€/€. The expected payback time of this process was ca. 4 years, and with a 35% internal rate of return (IRR). Most importantly, this process consumed 42.8m tonnes of CO2 annually. The sensitivity analysis revealed that variations in operation time, green hydrogen price, and products' prices significantly impacted the profitability of the process. Overall, this techno-economic analysis demonstrated that switchable catalysis in greenhouse gas utilisation processes is profitable, and thus it could play an important role in achieving net zero emissions.

Analisis Perlakuan Selisih Kurs Mata Uang Asing Pada PT Elang Mahkota Teknologi Tbk

The aim of this research is to analyze the treatment of foreign exchange differences at PT. Elang Mahkota Teknologi Tbk (EMTK), focusing on transaction management, the use of functional currency, and exchange rate risk mitigation. The research method employed is qualitative, with PT EMTK as the research subject. Data was obtained through literature review, referring to the Annual Reports of PT EMTK. The study indicates that PT EMTK adopts a cautious approach in handling foreign exchange transactions. The majority of business units use the Indonesian Rupiah as the functional currency, and the monetary assets and liabilities are adjusted to the exchange rates at the reporting date. Despite the absence of an official hedging policy, the company still considers current market conditions, especially regarding cash and cash equivalents balances in USD. Additionally, the research reveals that PT EMTK conducts sensitivity analysis on exchange rate risk, measuring the impact of exchange rate fluctuations on pre-tax profits. Overall, the company diligently monitors foreign exchange rate risks and takes proactive measures against external factors that may affect financial performance.

Pengaruh Kinerja Keuangan dan Corporate Governance terhadap Penghindaran Pajak

Tax avoidance is a strategy that aims to minimize corporate tax on pre-tax profit. This study aims to provide empirical evidence regarding the effect of company size, profitability, independent commissioners, and institutional ownership on tax evasion during the Covid-19 pandemic. The population in this study are manufacturing sector companies listed on the Indonesia Stock Exchange for the 2020-2021 period. By using purposive sampling technique, data were obtained from 74 companies so that 148 observations were obtained. This study shows the results that manufacturing sector companies listed on the IDX during the pandemic period, namely 2020-2021, several factors from financial performance and corporate governance influence the company's tax avoidance actions. The financial performance represented by the variable firm size and profitability shows a positive effect on tax evasion. In corporate governance, independent commissioners and institutional ownership have a negative effect on tax avoidance.

Multinationals' profits in China: Impact of tax avoidance

Based on proprietary and hand-collected source country information on foreign-owned firms in China, this paper empirically explores the effect of the tax avoidance of multinational firms on the profit rate of foreign-owned firms. Foreign firms in China previously benefited from various preferential tax policies and had a lower effective tax rate compared to domestic firms. The results show that the increase in the difference between the statutory maximum tax rate in the parent country and the domestic tax rate will increase foreign firms' pretax profit margin. This effect is more pronounced for younger firms and wholly foreign-owned firms. Further tests indicate that the transfer pricing in export and import activity of foreign firms is an important channel for multinational firms to shift profits. In year 2008, the implementation of the new Enterprise Income Tax Law has unified the corporate tax rate for both domestic and foreign firms at 25 percent. The tax reform reduces the profit margin of foreign firms, especially those with larger tax rate differentials. This paper explains multinational firms' profit performance from the novel perspective of tax avoidance.

INCOME DIVERSIFICATION, PROFITABILITY, AND RISK IN ISLAMIC BANKING IN INDONESIA

This study investigates the factors that affect income diversification and the associated risk in Indonesian Islamic banking. Panel regression is used to examine the correlation between risk factors, including primary operating revenue, fee-based income, internal and external factors, and the profitability of Islamic banks. Panel regression analysis has been conducted on the data from 2012-2016 to determine the factors that affect profitability and risk. The results show that pretax profit, after-tax profit as a proportion of total assets, and after-tax profit as a percentage of total equity react differently to income diversification. According to the findings, an increase in profit before taxes can be expected as the number and diversity of a company's revenue streams continue to expand. This indicates that the financial health of Islamic banks improves when they have access to many revenue streams. Furthermore, the standard deviation of baseline income shows that diversifying sources of income has little effect on internal risk.

PENGARUH GOOD CORPORATE GOVERNANCE DAN CORPORATE SOCIAL RESPONSIBILITY TERHADAP TAX AVOIDANCE


 This study aims to determine the effect of good corporate governance and corporate social responsibility on tax avoidance. good corporate governance is proxied by the independent commissioner and the audit committee, while corporate social responsibility is proxied by the corporate social responsibility disclosure index (CSRDI) and tax avoidance is proxied by the current ETR. corporate social responsibility disclosure index and measured based on the global reporting initiative 4.0. The population in this study are food and beverage companies listed on the Indonesia Stock Exchange (IDX) from 2019 to 2022, namely 31 companies. The research sample consisted of 17 companies or 68 observational data selected by purposive sampling method. The data used is secondary data obtained from the website of the Indonesia Stock Exchange (IDX) and the data analysis used is multiple linear regression analysis. The results of the study prove that the independent commissioner and corporate social responsibility have a significant effect on tax avoidance, while the audit committee has no effect on tax avoidance. independent commissioners have an effect on tax avoidance because commissioners play an active role in supervising the actions of company management, while corporate social responsibility can be used as a deduction from the company's pre-tax profit so that it affects tax avoidance.

MODERATING ROLE OF AUDIT QUALITY AND FIRM SIZE ON PRETAX PROFIT MARGIN AND RELATED PARTY TRANSACTIONS: EVIDENCE FROM INDONESIA

This study examines the effect of related party transactions (RPTs) on pretax profit margin (PPM). It analyzes the moderating effect of audit quality and firm size based on a large panel of Indonesian-listed firms. The sample of three representative business groups from 2010–2021 and analysis uses the Generalized Method of Moments (GMM) estimator to control PPM as a proxy of taxable income. We document that this study finds that PPM(t-1) and RPT Sales negatively impact and are significant on firms’ PPM, consistent with the incentive alignment hypothesis. However, RPTs, RPT Loan, and RPT Receivables affect positively. We also find that audit quality strengthens the impact of RPT Loan and RPT Receivables on the PPM negatively and positively significantly; however weakens RPTs, RPT Sales, and RPT Expenses. Moreover, firm size weakens the effect RPTs on PPM. RPTs and tax avoidance are complex and multifaceted phenomena of corporate finance. Additional business groups and variables may have moderating and mediating effects on the impact of taxable income on the business group. Stakeholders, especially the government, should supervise and control RPTs activities comprehensively, especially on the types of RPT Sales and RPT Expenses transactions. The paper offers two contributions. First, it gathers the first evidence on the taxable income and RPTs practices and offers insights into Indonesia’s business group behavior. Second, the analysis examines eleven years considering the sensitivity of audit quality and firm size to RPTs and pretax profit margin.

Pengaruh Kepemilikan Asing, Kualitas Audit, Dan Effective Tax Rate Terhadap Transfer Pricing

This study aims to determine the effect of foreign ownership, audit quality and effective tax rate on transfer pricing. This study uses a sample of mining companies listed on the Indonesia Stock Exchange (IDX) during the 2018-2021 period. The sampling method used purposive sampling with criteria set by the researcher so that a sample of 24 companies was used in this study. Management of data in research using multiple linear regression. The results of this study indicate that foreign share ownership has an effect on transfer pricing, audit quality and effective tax rate have no effect on transfer pricing. The contribution in this study empirically explains the relationship between foreign ownership using the percentage of foreign share ownership, audit quality using a dummy variable by determining a sample of company financial statements that are audited by big four KAP with a value of 1 and non-big four KAP with a value of 0, and the effective tax rate using the expense ratio current tax with pre-tax profit. This research provides information for the government to be able to decide on a policy of strict sanctions in overcoming problems related to tax suppression and stakeholders in the company can monitor the company's transaction activities with related parties in countries with low tax rates.
 Keywords: Foreign Ownership, Audit Quality, Effective Tax Rate, Transfer pricing

Start-up fintech valuation (financial capital)

In today's modern era, technological advances have supported the financial world in creating financial technology (fintech). One example of a fintech business is Peer to Peer Lending (P2P Lending) or Online Loans. In Indonesia, this business is growing rapidly and has good prospects, so it is hoped that P2P Lending companies can take the floor on the Indonesia Stock Exchange (IDX) to be able to attract foreign and domestic investors. One of the first fintech companies in Indonesia is Danamas. Danamas is registered and has total assets of Rp. 729,927,465,119. Before taking the floor on the IDX, it is necessary to calculate the correct valuation for Danamas. This study aims to calculate the valuation of Danamas as a fintech company. This research was conducted by processing Danamas financial report data for 2018-2020. The valuation method used is a combination of the Damodaran method and The First Chicago method with the Pre-tax Profit Margin history as a reference for obtaining estimated profits for the next 5 years. The results of this study are the company's value of Rp. 739,852,225,899. This is a positive valuation result because the company's value is greater than the total value of its assets.

Do social policies foster innovation? Evidence from India's CSR regulation

We examine the effect of social policies on corporate innovation using India's mandatory Corporate Social Responsibility (CSR) regulation. This regulation mandates firms with pre-tax profits above a certain threshold to spend 2 % of the profits on CSR. We demonstrate a significant bunching of companies just below the profit threshold post-regulation compared to the pre-regulation period. Firms close to the profit threshold manipulate their earnings to avoid compliance by increasing their R&D expenses. We show that, on average, firms that increase R&D expenses to avoid the regulation apply for one more patent and announce two new products. The increase in R&D expenses and patenting is concentrated in firms with a prior history of innovation. Our results suggest that social policies can generate indirect incentives for innovation.

Pengaruh Dewan Komisaris Independen, Komite Audit, Leverage dan Intensitas Modal Terhadap Penghindaran Pajak Pada Perusahaan Manufaktur Yang Terdaftar Di Bursa Efek Indonesia Tahun 2017

The problem in this study is how the influence of the Independent Board of Commissioners, Audit Committee, Leverage and Capital Intensity on manufacturing companies listed on the Indonesia Stock Exchange in the year. The purpose of this study was to examine the influence of the Independent Board of Commissioners, Audit Committee, Leverage and Capital Intensity on manufacturing companies listed on the Indonesia Stock Exchange. The population of this research is all manufacturing companies listed on the Indonesia Stock Exchange. The sampling method used purposive sampling and obtained a sample of 116 companies. The analysis technique used is simple linear regression analysis with the help of SPSS. The proxy used to measure Tax Avoidance uses the Tax Expense divided by Pre-Tax Profit. The proxy used to measure the Independent Board of Commissioners using Independent Commissioners is divided by the total number of members. The proxy used to measure the Audit Committee uses Dummy which is worth 1 if the audit committee is> 3, and is worth 0 if the audit committee <3. The proxy used to measure leverage uses Total Debt divided by Total Assets. For the proxies used to measure Capital Intensity using Total Net Fixed Assets divided by Total Assets. The results of hypothesis testing obtained with a significant level of 5% indicate that only the audit committee has an influence with a significance value of 0.029 <0.05 against tax avoidance. While the results of hypothesis testing for independent board of commissioners, leverage and capital intensity have no effect on tax avoidance.

A Manifestation of Impression Management in Corporate Reporting in Jse Top 40 Listed Companies

Purpose: The purpose of the study is to exposes impression management in the developing country, with a specific focus on the Top 40 Johannesburg Stock Exchange (JSE). Despite not being required by the International Financial Reporting Standards, the Chairperson's statement is the most read statement among the more than 80% of listed companies. The study investigated profitable and unprofitable companies' use of impression management through passive voice and personal references.
 Methodology: Secondary data in form of annual reports were used and self-attribution theory was used as framework. Mixed content analysis was used. Using a targeted sample, the study differentiated between 20 profitable and 20 unprofitable companies, based on the change in pre-tax profit between fiscal 2019 and fiscal 2020.
 Findings: Profitable and unprofitable companies used self-attribution bias. The Mann-Whitney test finds no significant difference despite profitable organizations’ using more self-attribution than unprofitable companies. The continued use of impression management deceives investors and impairs their ability to make informed decisions
 Implications: The study sends a strong warning to potential investors on use of impression management by listed companies. Further, the study further adds to the debate on impression management through self-attribution in corporate reporting.

Do Companies Really Care? Strategic Philanthropy and Imagine Canada’s Caring Company Program

First launched in 1988, Imagine Canada’s Caring Company program recognizes Canadian companies that contribute at least one percent of their pre-tax profit to nonprofit organizations within their employees’ communities. Broadly speaking, the program sets a standard for corporate strategic philanthropy. However, the program is vulnerable to the same tensions that underlie the broader practice of strategic philanthropy; namely, a blurring of the line between profit-seeking activity and addressing social need.

Analisis Rasio Perpajakan Badan Usaha Sub Sektor Telekomunikasi Sebelum Dan Saat Covid-19

This study aims to examine whether there are differences in the profitability performance of the telecommunications sub sector business entities on the Indonesia Stock Exchange in the period before the occurrence of Covid-19 and during the occurrence of Covid-19. To measure the profitability performance used 12 taxation ratios and 2 other important profitability ratios. These ratios are calculated using data from the financial statements of telecommunication sub sector business entities on the Indonesia Stock Exchange in 2018-2021. For conditions prior to the occurrence of Covid-19, financial report data for 2018 and 2019 are used and for conditions during the occurrence of Covid-19, financial report data for 2020-2021 are used. The ratio data obtained were tested for normality using the Kolmogorov-Smirnov and Shapiro-Wilk methods. Ratios whose data before and during the occurrence of Covid-19 are normally distributed will be subjected to a Paired Samples T Test to determine whether there is a significant difference in values before and during the occurrence of Covid-19. Meanwhile, for ratios whose data are not normally distributed, the Wilcoxon Signed Rank Test is carried out to determine whether there is a significant difference in values before the occurrence of Covid-19 and during the occurrence of Covid-19. This study shows that there are 2 different ratios, namely Gross Profit Margin (GPM) and Rent/Sales (S/P) in the period before and during the Covid-19 outbreak. While the other 12 ratios are Pretax Profit Margin (PPM), Net Profit Margin (NPM), Corporate Tax to Turn Over Ratio (CTTOR), Operating Profit Margin (OPM), Return on Equity (ROE), Return on Assets (ROA), Depreciation/Sales (P/P), Interest/Sales (B/P), VAT/Sales (PPN/P), Salary/Sales (G/P), Non Operating Income/Sales (PLU/P), and Non Operating Expense/Sales (BLU/P) did not show any difference between before and during the Covid-19 outbreak.

Pengaruh Profitabilitas Dan Likuiditas Terhadap Agresivitas Pajak Pada Perusahaan Subsektor Perdagangan Besar Dan Perdagangan Eceran Yang Terdaftar Di Bursa Efek Indonesia Periode 2017 - 2020

This study aims to examine the effect of profitability and liquidity as independent variables on tax aggressiveness as the dependent variable. Tax aggressiveness in this study is measured by the Effective Tax Rate by comparing the income tax expense with pre-tax profit. Profitability is measured by the ratio of return on assets, liquidity is measured by the current ratio.This type of research is quantitative using secondary data sources in the form ofannual financial reports or annual reports through the Indonesia Stock Exchange (IDX). The population used in this study is large trading and retail trading companies listed on the Indonesia Stock Exchange (IDX) starting from 2017 – 2020. The sampling technique in this study used purposive sampling with the specified research criteria so as to obtain a sample of 22 companies with data obtained as many as 88 data. The analytical method used is a multiple linear regression test, classical assumption test, determination coefficient test, F test and T test using the Statictical Package For the Social Sciences (SPSS) application program version 25.The results of the analysis of this study stated that partially profitability had a negative and significant effect on tax aggressiveness and liquidity had no effect on tax aggressiveness. While simultaneous profitability and liquidity affect the aggressiveness of taxes.

Factors Affecting Loan Loss Provisions during the Covid-19 Pandemic – The Case of Commercial Banks in Vietnam

Credit is considered a crucial activity of commercial banks; it accounts for the most significant proportion of the bank's total assets and is also an activity that carries great risks. The study uses OLS, FEM, REM, and FGLS to assess the factors affecting loan loss provisions (LLPs) of 20 Vietnamese commercial banks during the Covid-19 pandemic from Q1/2020 to Q4/2021. The result of the model is based on FGLS to overcome the phenomenon of heteroscedasticity after using estimation by OLS, FEM, REM, showing that the factors affecting LLP of Vietnamese commercial banks during the Covid pandemic include: bank size (SIZE), non-performing loans ratio (NPL), a ratio of pre-tax profit and provision to total assets (CROA), loans to total assets ratio (LOAN), and credit growth (ΔCREDIT). Research results using the FGLS method show that bank size, bad debt ratio, pre-tax profit ratio and provision to total assets and credit growth positively impact the LLP of the Vietnamese commercial banks in the Covid pandemic. However, interestingly, the percentage of loans to total assets can decrease the provision for loan losses. Thereby, the study proposes some policy implications as follows: The SBV needs to have the policy to limit credit growth and bad debt ratio for commercial banks to control the competition for a market share of loans without ensuring the quality of loans, leading to an increase in credit risk and LLP. Furthermore, each Vietnamese commercial bank needs to develop and apply a practical and comprehensive credit process to ensure debt recovery to avoid a lot of bad debts. For new customers, banks need to fully assess all aspects to predict the level of risk before deciding to provide loans. Additionally, the long-term effects of Covid-19 cause difficulties for commercial banks' activities, SBV needs to consider supportive policies through interest rate reduction, grace period, and debt extension to increase financial performance and maintain market share and profits of commercial banks.