|
on Accounting and Auditing |
| By: | Chen, Yuran; Duan, Dongni; Mao, Yidan; Zhang, Lingli |
| Abstract: | Using Chinese A-share listed data from 2007 to 2020, we reveal that increased competition in the banking system impairs the audit quality of banks’ credit clients, which is attributed to the loss of bank supervision. For firms with poor corporate governance or information quality, firms that hire auditors with low independence or high catering motivation, or firms in an immature external environment, such negative effect is more prominent. Furthermore, we indicate that firms are prone to shop for favorable audit opinions under high banking competition. Overall, we illustrate the negative effect of banking competition on auditors and provide meaningful implications. |
| Keywords: | regional banking competition; emerging market; auditor conservatism; Regional banking competition; AAM requested |
| JEL: | M42 G21 |
| Date: | 2024–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:123656 |
| By: | Johannes Kochems (University of Cologne) |
| Abstract: | This paper analyzes how (local) tax havens function. Using the German municipal business tax setting as a laboratory, I investigate the characteristics and emergence of local tax havens. I demonstrate that local tax havens are situated in close proximity to large agglomeration areas, while firms' profit-to-wage ratios in these jurisdictions are exceptionally high. I document that the amount of local profit shifting is substantial. The empirical results indicate that local profit shifting is of a similar magnitude to recent findings regarding international profit shifting by German multinationals. I deploy synthetic difference-in-differences methods, combined with administrative data sources and standard profit shifting equations, to estimate the amount of profit shifting to local tax havens. Between 2013 and 2019, around 52 billion Euros of corporate profits were shifted to local tax havens. The results are driven by a small number of large firms that offer business and financial services. The direct fiscal cost to non-tax haven municipalities amounts to roughly 7.9 billion Euros, while tax haven municipalities gain around 4.3 billion Euros in tax revenues. I conduct a case study on the emergence of Germany's largest local tax havens. I estimate that between 2012 and 2019, around 20.5 billion was transferred to its jurisdiction. The increase in local tax revenues is used to reduce public debt burdens and finance a high level of public expenditures. |
| Keywords: | Public Finance, Fiscal Federalism, Corporate Taxation, Tax Havens, Profit Shifting |
| JEL: | H25 H26 H32 H71 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:ajk:ajkdps:379 |
| By: | Abderrahman Elghazzali (Université Hassan 1er [Settat]); Jalal Ait Ouakrim (Université Hassan 1er [Settat]) |
| Abstract: | Based on a study of the various performance indicators in public sector, and based on the professional experience the authors have accumulated either in working for the Moroccan Tax administration, or in interacting with it , our research aims to develop a set of performance indicators to be used by the Moroccan tax authority in order to assess the performance of tax audits. The article discusses first the concept of performance in its broad sense by highlighting the usefulness of its measurement as the triggering element of the management loop in the field of management in general, and in public management in particular. The following section gives particular attention to identifying the main ratios among the most commonly used in public management. After demonstrating the need to setup a system for assessing the tax audit process, the paper suggests to the Moroccan Tax Authority a well-defined, comprehensive, and detailed model that covers all strategic and operational aspects related to tax audit. Indeed, the proposed model includes not only the financial and quantitative aspects, but it goes beyond them and covers the qualitative aspects related to internal processes and resources management. Finally, the end of the paper aims to underline the key factors that significantly influence the tax audit process. These factors, whether endogenous or exogenous to the tax administration, are likely to constitute sources of influence on the desired performance. Classification JEL : H83 Paper type : Theoretical Research |
| Abstract: | Le présent article explore les critères d'évaluation des systèmes de contrôle des administrations publiques avec pour objectif de proposer un modèle équipé d'un ensemble d'indicateurs destinés à l'administration fiscale marocaine. Le travail réalisé est le résultat d'une revue approfondie de la littérature concernant l'évaluation de la performance dans le domaine du management de l'appareil public. Mais, il est également le fruit des expériences que les auteurs ont accumulées soit en travaillant au sein de la direction des impôts au Maroc, soit en inter-réagissant avec celle-ci. L'article aborde d'abord la notion de la performance dans son sens large, en mettant en exergue l'utilité de sa mesure comme étant l'élément déclencheur de la boucle du pilotage dans le domaine de gestion en général, et dans le management public en particulier. La partie suivante porte une attention particulière au recensement des principaux ratios parmi les plus pratiqués dans la gestion publique. Après avoir démontré minutieusement le besoin de mettre en place un système rigoureux pour l'évaluation du processus de contrôle fiscal, l'article présente un modèle bien défini, complet et détaillé qui couvre tous les aspects stratégiques et opérationnels liés au processus de contrôle fiscal. En effet, il est proposé un modèle qui inclut non seulement les aspects financier et quantitatif, mais qui couvre également les volets temporel, qualitatif et ceux liés aux processus internes et à la gestion des ressources au niveau de la Direction des impôts. Dans sa dernière partie, l'article a pour but de mettre l'accent sur les facteurs clés qui interviennent de manière significative dans le processus de contrôle fiscal ; ces facteurs tantôt endogènes et exogènes à l'administration étant susceptibles de constituer des sources d'influence de la performance recherchée. JEL Classification : H83 Type du papier : Recherche Théorique |
| Keywords: | Efficiency, Efficacity, performance indicators, Performance, Tax control, Efficience, Efficacité, Indicateurs de performance, Contrôle fiscal |
| Date: | 2025–09–29 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05291055 |
| By: | Lazar, Cristina; Asalos, Nicoleta; Bostan, Ionel |
| Abstract: | Background and aim: The article investigates the systemic deficiencies and risks in Romania’s municipal waste management system during the post-pandemic period, focusing on the role of external public audit missions conducted by the Romanian Court of Accounts. The main objective is to assess the risk of infringement procedures against Romania due to persistent non-compliance with EU environmental directives. Scope and limitations: The research concentrates on the period 2015–2021, with particular emphasis on the case of Constanța County, and is limited to the analysis of official audit reports and regulatory frameworks. Methods: The study employs a qualitative methodology based on document analysis, comparative evaluation of legal frameworks, and synthesis of audit findings, with emphasis on compliance, infrastructure, and institutional performance. Results: Findings highlight significant shortcomings: delayed closure of non-compliant landfills, insufficient implementation of selective collection and recycling, lack of a functional electronic traceability system, and weak monitoring by central and local authorities. Constanța County illustrates critical infrastructural and contractual deficiencies that compromise EU compliance targets. Conclusions: Romania remains at high risk of EU sanctions due to poor waste management performance, limited strategic coordination, and underuse of European funding. Originality: The article provides an integrated perspective by linking external audit findings to broader systemic vulnerabilities in the post-pandemic context. Practical implications: The study offers actionable recommendations for improving compliance, strengthening administrative capacity, and ensuring alignment with EU circular economy goals, thus supporting policymakers and practitioners in sustainable waste governance. |
| Keywords: | Municipal waste management, external public audit, Constanța county (Romania), environmental compliance, EU infringement risk. |
| JEL: | H6 H61 H8 H83 M4 M42 M48 Q5 Q59 |
| Date: | 2025–09–09 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126535 |
| By: | C. Peter; J. Li (Audencia Business School); H. S. Wilson Tong; C. Chingfu Tsai |
| Abstract: | We demonstrate that a persistent pattern exists in the evolution of the MTB ratio from 1999 to 2023, wherein firms with high (low) MTB ratios tend to maintain those levels over time. The persistence of the MTB ratio is independent of industry effects and cannot be well explained by accounting performance. Intangible investment plays a crucial role in determining the MTB ratio, and its persistence is primarily maintained through continued internal intangible investment rather than external mergers and acquisitions. Moreover, although U.S. firms have increased their investment in intangible assets over the past 25 years, the gap between high- and low-MTB firms in intangible investment has widened. Our results suggest that the basis of stock value has shifted from tangible to intangible investments over time. |
| Keywords: | Market-to-book ratio, return-on-equity, value persistence, abnormal earnings, intangible investment |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05302706 |
| By: | Tahani Ali Hakami (Department of Accounting and Finance, Jazan University) |
| Abstract: | This study conducts a bibliometric analysis of research trends in technology adoption in auditing over the period from 1995 to 2025. Technological advancements have fundamentally transformed auditing practices, and this research aims to map the evolution, focus areas, and key contributors to the field. Using a dataset of 50 highly relevant articles from the Web of Science, the study explores publication trends, co-authorship networks, geographic collaboration patterns, keyword co-occurrence, and citation analysis. Findings reveal a marked increase in publications post-2010, with a surge observed around 2020. Key emerging topics include artificial intelligence, blockchain, and cloud computing, which have become central to the discourse on audit innovations. The analysis also highlights the dominant journals and institutions in the field, with significant contributions from RMIT University and Cairo University. By examining these trends, this research provides valuable insights into the evolving relationship between technology and auditing, suggesting future directions for both scholars and practitioners. |
| Keywords: | Technology Adoption in Auditing; Digital Transformation; Audit Innovation; Artificial Intelligence in Auditing; Blockchain in Auditing |
| JEL: | M42 |
| URL: | https://d.repec.org/n?u=RePEc:sek:iefpro:15416809 |
| By: | Eduardo Azevedo; Florian Scheuer; Kent Smetters; Min Yang |
| Abstract: | Recent proposals to tax unrealized capital gains or wealth have sparked a debate about their impact on entrepreneurship. We show that accrual-based taxation creates two opposing effects: successful founders face greater dilution from advance tax payments, whereas unsuccessful founders receive tax credits that effectively provide insurance. Using comprehensive new data on U.S. venture capital deals, we find that founder returns remain extremely skewed, with 84% receiving zero exit value while the top 2% capture 80% of total value. Moving from current realization-based to accrual-based taxation would reduce founder ownership at exit by 25% on average but would also increase the fraction receiving positive payoffs from 16% to 47% when tax credits are refunded. Embedding these distributions in a dynamic career choice model, we find that founders with no or moderate risk aversion prefer the current realization-based tax system, while more risk-averse founders prefer accrual-based taxation. We estimate that a 2% annual wealth tax has a similar impact on dilution as taxing unrealized capital gains, but produces no risk-sharing benefits due to the absence of tax credits in case of down rounds. |
| Keywords: | capital gains tax, wealth tax, venture capital, entrepreneurship, dilution |
| JEL: | G3 H2 J3 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12275 |
| By: | Kevin Parra Ramirez; Vincent Vicard |
| Abstract: | While multinational enterprises (MNEs) shift hundreds of billions in profits to low-tax jurisdictions annually, how they do remains disputed. Using firm-level data for France in 2018, we provide the first joint quantification of the three main profit-shifting channels: transfer mispricing in goods trade, intangible assets and services traded with tax havens, and intra-firm debt. We find empirical evidence for all three instruments, but transfer mispricing dominates quantitatively (€10 billion, 0.4\% of GDP), followed by services (up to €6 billion) and debt (€2 billion). Although significant, these direct estimates account for half of total missing profits in France, as estimated indirectly from the location of MNE profits. We document two key blind spots likely to close this gap: cross-border digital payments by households and understudied debt instruments (e.g., securities). |
| Keywords: | Tax Avoidance;Multinational Firms;Profit Shifting;FDI;Trade |
| JEL: | H26 H25 H32 F14 F23 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:cii:cepidt:2025-16 |
| By: | Lorenzo Garlanda-Longueville; Mathias Lé; Kevin Parra Ramirez |
| Abstract: | Tax havens represent the largest financing hub for financial institutions. For banks, they account for more than 20% of all cross-border banking debts worldwide. Yet, our understanding of the underlying drivers remains limited, partly due to data scarcity and partly because of the difficulty of disentangling tax incentives from regulatory effects. Drawing on a unique global dataset covering major international banks and offshore financial centres – and employing a novel approach to isolate regulatory arbitrage – this paper finds that the location of cross-border intra-group debt held by multinational banks is shaped by tax considerations, even when regulatory differences are accounted for. In doing so, we provide, for the first time, direct evidence of profit shifting via debt shifting at a global scale, overcoming a key limitation of existing studies, which typically rely on single-country data. Based on our sample data, we show that the magnitude of “excess” offshore banking debt globally recorded in tax havens is significant. |
| Keywords: | Profit shifting, Debt shifting, Multinational banks, Taxation, Intragroup transactions |
| JEL: | H26 G21 F23 F34 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2025-43 |
| By: | Hernán Rincón-Castro; Steven Zapata-Álvarez |
| Abstract: | Una relación básica que deberían conocer y entender las autoridades económicas, analistas de los asuntos fiscales y macroeconómicos e inversionistas, es aquella entre el presupuesto general de la nación y el balance fiscal del gobierno central. A pesar de su importancia y discusión continua, su conexión no se entiende con claridad y precisión. El objetivo del estudio es explicar de manera sencilla pero técnica y rigurosa las etapas del proceso de ejecución del presupuesto en Colombia, la medición actual del balance fiscal y la relación y diferencias entre ellos. El estudio muestra que, si bien existe una relación cercana entre ambos, la medida del balance fiscal incorpora ajustes contables, metodológicos y operacionales que no están en el presupuesto aprobado y que hacen que no sea fácil conectarlos, comprenderlos y evaluarlos. Por este motivo, se recomienda adoptar plenamente los estándares internacionales de contabilidad de devengo, con el fin de que se conviertan en las estadísticas de seguimiento y evaluación de la situación fiscal del gobierno. Esto permitiría alinear el presupuesto y el balance fiscal a principios y metodologías comunes y a generar mayor transparencia, credibilidad en las estadísticas y consistencia con la contabilidad pública y nacional. *****ABSTRACT: A basic relationship that economic authorities, fiscal and macroeconomic analysts, and investors should be aware of and understand is that between the nation's general budget and the central government's fiscal balance. Despite its importance and ongoing discussion, this connection is not clearly and precisely understood. The objective of this study is to explain in a simple yet technical and rigorous manner the stages of the budget execution process in Colombia, the current measurement of the fiscal balance, and the relationship and differences between them. The study shows that, although there is a close relationship between the two, the measurement of the fiscal balance incorporates accounting, methodological, and operational adjustments that are not included in the approved budget and that make them difficult to connect, understand, and evaluate. For this reason, it is recommended to fully adopt international accrual accounting standards so that they become the monitoring and evaluation statistics for the government's fiscal situation. This would align the budget and the fiscal balance with common principles and methodologies and generate greater transparency, credibility in statistics, and consistency with public and national accounting. |
| Keywords: | presupuesto, balance fiscal, caja, devengo, extrapresupuestal, relación, diferencias, Budget, fiscal balance, cash, accrual, extrabudgetary, relationship, differences |
| JEL: | H61 H62 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:bdr:borrec:1331 |
| By: | F. Javier S\'anchez-Vidal |
| Abstract: | This paper investigates a fundamental methodological flaw in the investment-cash flow sensitivity model of Fazzari, Hubbard, and Petersen (1988). The model comes from a full accounting identity in which some components are missing, generating what I term an Accounting Semi-Identity, that mechanically links investment and cash flow, and this could bias coefficients, making the estimation difficult if not impossible. I propose an augmented specification including a variable that captures this arithmetic bias and test it across multiple firm-level databases. Results show that the ASI distortion is universal and severe: the ASI issue is present in 100% of the databases and explains more than 83% of the total explained variance, while the standard Fazzari, Hubbard, and Petersen (1988) model only accounts for approximately 17%. These findings suggest that a substantial body of prior empirical research based on this model may have reported spurious results rather than evidence of underlying economic behavior. This finding provides a compelling explanation for the substantial body of literature surrounding this model that has reported anomalous and incoherent results. |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2511.08591 |
| By: | Theophanis C. Stratopoulos; Victor Xiaoqi Wang |
| Abstract: | Recent advances in artificial intelligence, particularly generative AI (GenAI) and large language models (LLMs), are fundamentally transforming accounting research, creating both opportunities and competitive threats for scholars. This paper proposes a framework that classifies AI-accounting research along two dimensions: research focus (accounting-centric versus AI-centric) and methodological approach (AI-based versus traditional methods). We apply this framework to papers from the IJAIS special issue and recent AI-accounting research published in leading accounting journals to map existing studies and identify research opportunities. Using this same framework, we analyze how accounting researchers can leverage their expertise through strategic positioning and collaboration, revealing where accounting scholars' strengths create the most value. We further examine how GenAI and LLMs transform the research process itself, comparing the capabilities of human researchers and AI agents across the entire research workflow. This analysis reveals that while GenAI democratizes certain research capabilities, it simultaneously intensifies competition by raising expectations for higher-order contributions where human judgment, creativity, and theoretical depth remain valuable. These shifts call for reforming doctoral education to cultivate comparative advantages while building AI fluency. |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2511.16055 |
| By: | Roberto Perli |
| Abstract: | Remarks at 2025 U.S. Treasury Market Conference, Federal Reserve Bank of New York, New York City. |
| Keywords: | Treasury market; monetary policy; money markets; Federal Reserve Balance Sheet; rate control; Standing Repo Facility; repo rates; reserves |
| Date: | 2025–11–12 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednsp:102098 |
| By: | Tugba Gunes; Isil Erol |
| Abstract: | Property transactions in Turkey are subject to a transaction fee that is calculated based on transaction prices declared by sellers and buyers. Declared prices cannot be lower than property tax values which are far lower than the actual or observed market prices. Because declared prices are strategically reported at around tax values of the properties for cash purchases or at an adjusted price in accordance with the mortgage loan amount in the case of mortgaged sales, reliable transaction price data in the official records are not available. If a property is sold within five years after the purchase date and the price difference is higher than a certain exemption amount, remaining amount of capital gain is subject to capital gains tax. In this study, we explore the impact of capital gains tax on the re-selling behavior of property owners. We use a novel transaction level repeat sales dataset provided from the land registry agency. Our empirical analyses show that the number of transactions and declared purchase prices are significantly influenced by the capital gains tax threshold. We compare the transactions right before and after the 5-year-holding-period mark and find that transaction price changes between repeated sales are significantly lower in the pre-period than those in the post-mark. The results indicate that mortgage sales relative to cash sales are more likely to occur immediately after the five-year holding period threshold. This suggests that sellers are more confident in selling their properties without the concern of incurring a capital gains tax liability, likely due to the high loan amounts involved. |
| Keywords: | Capital Gains tax; Holding Period; residential property market |
| JEL: | R3 |
| Date: | 2025–01–01 |
| URL: | https://d.repec.org/n?u=RePEc:arz:wpaper:eres2025_159 |