Using data from Finnish private firms, we examine the association between corporate governance and tax aggression in a high tax alignment environment. We find evidence of a non-linear relationship between CEO ownership and tax aggressiveness. Our results indicate that organisations with low...

This study examines the effect of tax aggressiveness and voluntary audit of the financial statements on the likelihood of tax adjustments in small private companies. We provide evidence that (1) tax aggressiveness increases the likelihood of the tax authority not accepting taxable income as...

Using a large sample of firms that report under mandatory IFRS from 51 countries, this study examines the association between conditional conservatism, institutional quality, and Big 4 audits. We hypothesize and find that the degree of conditional conservatism is higher in countries with better...

The purpose of this study is to uncover additional determinants of the demand for voluntary audit in micro-companies by investigating the internal management factors that have not yet been explored in prior literature. The hypotheses are developed from the literature and interviews with...

Using a large proprietary data set from the internal records of the Finnish Tax Administration for the fiscal year 2011, we examine the factors that trigger adjustments by the tax authority to the taxable income reported by around 25,000 small private companies. Using that data, we develop a new...

This study investigates the extent to which the pressures from outside stakeholders, specifically the providers of debt and trade credit, as opposed to owner-managers' internal needs explain the use of voluntary audits in micro-companies. Whereas previous studies have mainly focused on how bank...

We examine the effect of changes in audit risk standards on the conduct of financial statement audits in a European setting. We investigate this by analysing the audit hours and audit fees for clients of Big 4 audit firms in Finland in 1996 and 2010. Our results show that audit firms became more...

The purpose of this study is to validate the drivers of voluntary audit in small companies identified in previous research and uncover additional determinants related to agency conflicts with owners. For our research we use the German institutional setting, documented in the literature as being...

While inputs into analysts' valuation models have been documented (Brown et al. 2015), analysts' prior perceptions of reported financial statement items have not yet been studied. It is important to be aware of analysts' perceptions of the current accounting standards because they are, to some...

This study examines the role of auditors and monitoring banks in the tax aggressiveness of private firms. We use a unique data set of private SMEs in Finland where book-tax alignment is high and the auditing of private firms (exceeding a low threshold) is mandatory. We add to the existing...