This study investigates the association between private company auditing and intertemporal income shifting. Using a large reduction in the Finnish corporate tax rate as a strong incentive for income shifting and financial statement data coupled with proprietary information from the tax...

We examine whether tax audit regimes become more efficient if (i) there are audited financial statements and (ii) tax auditors have access to the internal statutory audit report revealing information about statutory audit adjustments. Our analysis is based on a standard tax compliance game that...

We study tax compliance under decentralized versus centralized tax enforcement. Using a tax administration reform in Canada, we examine which organizational level of tax enforcement leads to higher compliance. Our results show that there is more tax avoidance under centralized tax enforcement....

This paper examines how different remuneration alternatives for the tax auditors in a corrupt tax administration can provide them incentives to work harder towards discovering evasion. The model is built on the interaction between a potential tax evader and a tax auditor that can either be...

This study uses a confidential dataset of firms assigned to the Internal Revenue Service (IRS)'s Coordinated Industry Case (CIC) program to examine the effect of audit certainty on firms' tax reporting behavior. We first model the determinants of assignment to the program. Though the ability and...

A study examined private companies’ tax aggressiveness and its changes in response to interventions by the tax administration. While scholars have researched authorities’ interventions extensively, this study was the first to consider the “light” technique of tax adjustments made by the...

We evaluate whether, and under what circumstances, corporate tax aggressiveness influences audit pricing. Using a compound measure of two long-run effective tax rates, we find that tax aggressive firms pay higher fees for external audit services after controlling for factors related to earnings...

We examine whether Big 4 auditors and non-Big 4 auditors maintain similar or different levels of financial reporting quality for private firms. DeAngelo (1981) suggests that litigation and reputation considerations incentivize Big 4 auditors to deliver higher audit quality than non-Big 4...

This study examines how the appointment of tax certified individual auditors is associated with reported effective tax rates of corporate clients. The study uses a unique German institutional setting which makes it possible to track individual auditors that are also certified tax consultants and...

Using a tax compliance game, we study whether the observability of the taxpayer's financial accounting information and the statutory auditor's report affects the tax compliance. We find that firms' responses differ significantly between private and public firms. Private firms compensate for the...