The Effects of Audit Firms' Industry Specialization and Client Importance on Industry Tax Avoidance

• Main Authors: Yu-Xuan Sun, 孫宇炫
• Other Authors: Jiun-Nan Pan
• Format: Others
• Language: zh-TW
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/6bbw57

碩士 === 元智大學 === 財務金融暨會計碩士班(會計學程) === 106 === In 2014, the European Union found that Apple Inc. had tax avoidance up to 12.5 billion dollars by low tax rates countries such as Ireland. And Facebook, Google, and Amazon were also exposed Profit Shifting to tax havens. Among them, tax avoidance strategies include International Bank, Taiwan's Big Four accounting firms, and international law firms. It must depend on industry specialization accountants to plan the tax avoidance strategies. The tax avoidance activities not only to bring the advantage to the company, but there have some negative new after it discovered from National Tax Administration and news media. It also affects the reputation of accountants and the accounting firm. Therefore, accountants have incentives to control Book-Tax Difference to reduce the risk of tax avoidance. When the industry specialization has an economic dependence on his important clients, whether accountants would require the company to reduce their book-tax difference. This study uses the panel smooth transition regression model. The industry specialization as a threshold to distinguish between the high- industry specialization and low-industry-specialization, whether client importance were impact the corporate book-tax differences. This paper finds that the significant positive relationship between client importance and book-tax differences under the high industry specialization. It means that the accounting firm's economic dependence on important client is greater than the reputational effect, and the accountants independence may be impair.