[go: up one dir, main page]

IDEAS home Printed from https://ideas.repec.org/a/ntj/journl/v57y2004i3p739-56.html
   My bibliography  Save this article

Lost in Translation: Detecting Tax Shelter Activity in Financial Statements

Author

Listed:
  • McGill, Gary A.
  • Outslay, Edmund
Abstract
Whether financial statements of public U.S. corporations provide sufficient information to the public to determine a corporation's tax payment to the U.S. Treasury and its involvement in "tax shelter" transactions has been much debated since the well publicized collapses of Enron Corporation and WorldCom, Inc. In this paper, we use specific examples to demonstrate how "income tax note" data can be analyzed to answer these two questions and, in so doing, point out the limitations of using financial accounting information to address tax–related issues. We conclude with suggestions to increase the transparency of a corporation's tax activities through enhanced disclosure.

Suggested Citation

  • McGill, Gary A. & Outslay, Edmund, 2004. "Lost in Translation: Detecting Tax Shelter Activity in Financial Statements," National Tax Journal, National Tax Association;National Tax Journal, vol. 57(3), pages 739-756, September.
  • Handle: RePEc:ntj:journl:v:57:y:2004:i:3:p:739-56
    DOI: 10.17310/ntj.2004.3.13
    as

    Download full text from publisher

    File URL: https://doi.org/10.17310/ntj.2004.3.13
    Download Restriction: Access is restricted to subscribers and members of the National Tax Association.

    File URL: https://doi.org/10.17310/ntj.2004.3.13
    Download Restriction: Access is restricted to subscribers and members of the National Tax Association.

    File URL: https://libkey.io/10.17310/ntj.2004.3.13?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lenter, David & Slemrod, Joel & Shackelford, Douglas A., 2003. "Public Disclosure of Corporate Tax Return Information: Accounting, Economics, and Legal Perspectives," National Tax Journal, National Tax Association;National Tax Journal, vol. 56(4), pages 803-830, December.
    2. Boynton, Charles & Mills, Lillian, 2004. "The Evolving Schedule M–3: A New Era of Corporate Show and Tell?," National Tax Journal, National Tax Association;National Tax Journal, vol. 57(3), pages 757-772, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michelle Hanlon & Terry Shevlin, 2005. "Book-Tax Conformity for Corporate Income: An Introduction to the Issues," NBER Chapters, in: Tax Policy and the Economy, Volume 19, pages 101-134, National Bureau of Economic Research, Inc.
    2. Michelle Hanlon & Terry Shevlin, 2005. "Bank-Tax Conformity for Corporate Income: An Introduction to the Issues," NBER Working Papers 11067, National Bureau of Economic Research, Inc.
    3. Bayer, Ralph & Cowell, Frank, 2009. "Tax compliance and firms' strategic interdependence," Journal of Public Economics, Elsevier, vol. 93(11-12), pages 1131-1143, December.
    4. Erlend E. Bø & Joel Slemrod & Thor O. Thoresen, 2015. "Taxes on the Internet: Deterrence Effects of Public Disclosure," American Economic Journal: Economic Policy, American Economic Association, vol. 7(1), pages 36-62, February.
    5. Litina, Anastasia & Palivos, Theodore, 2016. "Corruption, tax evasion and social values," Journal of Economic Behavior & Organization, Elsevier, vol. 124(C), pages 164-177.
    6. Graham, John R. & Raedy, Jana S. & Shackelford, Douglas A., 2012. "Research in accounting for income taxes," Journal of Accounting and Economics, Elsevier, vol. 53(1), pages 412-434.
    7. Hope, Ole-Kristian & Ma, Mark (Shuai) & Thomas, Wayne B., 2013. "Tax avoidance and geographic earnings disclosure," Journal of Accounting and Economics, Elsevier, vol. 56(2), pages 170-189.
    8. Giombini, Germana & Teobaldelli, Désirée & Schneider, Friedrich, 2018. "Interaction effect of tax evasion and legal system inefficiency on firms' financial constraints," International Review of Economics & Finance, Elsevier, vol. 55(C), pages 1-20.
    9. Heltzer, Wendy & Shelton, Sandra Waller, 2011. "The book–tax divide: Perceptions from the field," Research in Accounting Regulation, Elsevier, vol. 23(2), pages 130-137.
    10. Dutt, Verena & Spengel, Christoph & Vay, Heiko, 2021. "Der EU-Vorschlag zum Country-by-Country Reporting im Internet: Kosten, Nutzen, Konsequenzen," Studien, Stiftung Familienunternehmen / Foundation for Family Businesses, number 250010.
    11. Hanlon, Michelle, 2003. "What Can We Infer About a Firm’s Taxable Income From Its Financial Statements?," National Tax Journal, National Tax Association;National Tax Journal, vol. 56(4), pages 831-863, December.
    12. Dutt, Verena & Spengel, Christoph & Vay, Heiko, 2017. "Der EU-Vorschlag zum Country-by-Country Reporting im Internet: Kosten, Nutzen, Konsequenzen," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 172786.
    13. Evers, Maria Theresia & Meier, Ina & Spengel, Christoph, 2014. "Transparency in financial reporting: Is country-by-country reporting suitable to combat international profit shifting?," ZEW Discussion Papers 14-015, ZEW - Leibniz Centre for European Economic Research.
    14. Anastasia Litina & Theodore Palivos, 2015. "Corruption and Tax Evasion: Reflections on Greek Tragedy," Working Papers 193, Bank of Greece.
    15. Caballé, Jordi & Dumitrescu, Ariadna, 2020. "Disclosure of corporate tax reports, tax enforcement, and price information," Journal of Banking & Finance, Elsevier, vol. 121(C).
    16. Elena M. Parilina & Alessandro Tampieri, 2018. "Stability and cooperative solution in stochastic games," Theory and Decision, Springer, vol. 84(4), pages 601-625, June.
    17. Gallemore, John & Labro, Eva, 2015. "The importance of the internal information environment for tax avoidance," Journal of Accounting and Economics, Elsevier, vol. 60(1), pages 149-167.
    18. Priya Manwaring & Tanner Regan, 2023. "Public Disclosure and Tax Compliance: Evidence from Uganda," CSAE Working Paper Series 2023-05, Centre for the Study of African Economies, University of Oxford.
    19. Epps, Kathryn K. & Catherine Cleaveland, M., 2009. "Insiders’ perspectives of the effects of recent regulation on corporate taxation," Research in Accounting Regulation, Elsevier, vol. 21(1), pages 34-47.
    20. David P. Weber, 2009. "Do Analysts and Investors Fully Appreciate the Implications of Book†Tax Differences for Future Earnings?," Contemporary Accounting Research, John Wiley & Sons, vol. 26(4), pages 1175-1206, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ntj:journl:v:57:y:2004:i:3:p:739-56. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: The University of Chicago Press (email available below). General contact details of provider: https://www.ntanet.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.