재무보고시점과 세무보고시점의 차이에 따른 이연법인세 공시의 적정성과 기업특성

초록

When a tax return is filed, tax reconciliation items and amounts are exactly disclosed through the tax return, but when a financial information is reported, temporary items and amounts for calculating deferred corporate tax are disclosed through an auditor’s report. In practice, because a financial report precedes a tax report and the purposes of what they report are different, an error in permanent or temporary differences may occur. If errors in temporary differences occur, the assets and liabilities are incorrectly disclosed on the balance sheet and thus the financial status of a corporation is distorted. And errors in permanent differences affect corporate tax expenses and accounting income. The exact disclosure of tax returns becomes the source of calculation of deferred income tax. Therefore, the study related to deferred income tax is required to be made from the basic standpoint of the exact disclosure of tax return. However, most of prior studies have focused on earnings management using deferred income tax, realizable possibility of deferred income tax assets and value relation of deferred income tax. Therefore before evaluating empirical results of prior studies related to deferred income tax, it is necessary to examine the accuracy of tax reconciliation items and amounts. Accordingly, this study examined the errors in temporary and permanent differences occurring from book-tax timing differences(differences in the time between a financial and a tax report) using corporate tax-related materials disclosed by a firm. This study also empirically analyzed firm characteristics which can generate such errors. For this analysis, we estimate the empirical model containing the seven firm characteristics discussed following using OLS regression. Specifically, we use the seven firm characteristics that focus on reliability of the disclosure on deferred tax: (i) Debt ratio(proxy of financial structure), (ii) Size of total assets, (iii) ROA(proxy of financial performance), (iv) Book-tax timing differences between points of time of a financial and tax report, (v) Size of external auditor, (ⅵ) Foreign investor ownership and (ⅶ) Principal stockholder ownership. Based on the explanation discussed above, we test the following hypothesis. (i) the poorer financial performance and financial structure are, the larger errors in temporary or permanent differences are reported, (ii) the longer book-tax timing differences between points of time of a financial and tax report are, the larger errors in temporary or permanent differences are reported, (iii) the higher ratio of foreign ownership and principal stockholder ownership are, the larger errors in temporary or permanent differences are reported. The sample selection procedure is summarized as follows; Our initial sample consists of 1,260 observations(firm-year) available on TS 2000 belonging to manufacturing industry with December fiscal years listed on the Korea Stock Exchange from 2004 to 2006. From these total observations, we exclude 131 observations (missing financial data and temporary and permanent differences data). We also delete the top and bottom 1% of dependent and independent variable to mitigate the effects of extreme observations. Accordingly, we exclude 40 observations because of deletion of the outlier. Of the remaining 1,089 observations, 399 observations(about 37% of the total samples) have the errors in temporary differences and 152 companies (about 14% of the total samples) have the errors in permanent differences. When total samples with an error were classified to subsample according to whether errors repetitively occurred or not, it was found an error occurred more than twice in 36% of them. It means that an error tends to be comparatively repeated. Firms adjusted errors not through modification of the current financial statements but through the notes related to deferred corporate tax of the next year audited statements. This means that most of companies calculate deferred tax through tentative tax adjustment for only calculating accounting profits and subsequently report a true tax amount to be paid through exact tax adjustment. The analysis results are as follows. First of all, it was found that the median of errors in temporary differences was a negative value and the median of errors in permanent differences was a positive value at the point of time of a financial and tax report. This means that more deductible temporary difference or fewer taxable temporary difference tend to be reported and more taxable permanent differences or deductible permanent differences tend to be reported at the time of a financial report. The disclosure of errors in incorrect negative temporary differences leads to overstatement of assets and liabilities. Also, the errors in positive permanent differences may result in a increase of net income through an decrease in corporate tax. In the second place, the results of analysis of firm characteristics affecting the errors occurring between the time of a financial and tax report are as follows. First, it was found that a firm with the poorer financial performance and financial structure, the smaller total assets and the higher ratio of principal stockholder ownership, tends to report the lower deductible temporary differences and the higher taxable temporary differences when a financial report is made. This leads to understatement of assets and liabilities and misstatement of debt ratio. Also it may inform outside interested parties with underestimation about cash outflow. Second, it was found that a firm having the larger book-tax timing differences and being audited by the Non-BIG, tends to report fewer deductible permanent differences or more taxable permanent differences when making a financial report. This is likely to understate accrued corporate tax that is to be disclosed as of the day of balance sheets and leads outside interested parties to underestimate cash flow related to corporate tax. Simultaneously, this may lead to a decrease of corporate tax expense to be reported in income statements and result in an increase of accounting income which are ultimately reported. In the meantime, errors of temporary and permanent differences were classified according to whether or not they repetitively occurred. The group was divided into the one in which each error occurred once and the one in which each error occurred twice, and analysis of firm characteristics affecting errors was made. As a result of analysis, the occurrence types of errors according to variables of firm characteristics were more remarkably discovered in the firm in which each error repetitively occurred over twice than the one in which each error occurred once. Finally, this study analyzed sensitive test classifying size of error by absolute value, because the errors in temporary differences and in permanent differences have a large gap in size of absolute value. The result of additional test indicated that firms in which the absolute value of error took place in large scale have similar firm characteristics with those where error occurred more than twice. This study implies that temporary and permanent differences occurring from book- tax timing differences(differences between points of time of a financial report and a tax return) may lead to incorrect calculation of deferred corporate tax and thus greatly affect the reliability of financial status and accounting income publicly announced by a corporation. Accordingly, it is required that a supervising agency should recommend firms to maintain an accounting system in which they can actually reduce errors related to corporate tax through active methods such as supervision. Also, from the standpoint of an auditor, it is expected to improve the reliability of accounting information as well as audit quality by paying attention to audit procedure of incorrect corporate tax. In the meantime, this study had some limitations in that it conducted an analysis excluding the effect owing to valuation of deferred tax assets with respect to realizability of future tax expense and thus it would be necessary to consider additional firm characteristics variables occurring errors which were not found out in this study. In other words, future studies should elaborately examine the associations between the book-tax timing differences and firm characteristics. It is also expected that precise analysis of concrete account item affecting the error of tax reconciliation items and amounts will propose more useful information on deferred income tax.

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