Dissertation
Mandatory disclosure and uncertain tax benefit resolutions
Doctor of Philosophy (Ph.D.), Drexel University
Jun 2024
DOI:
https://doi.org/10.17918/00010690
Abstract
I investigate the impact of mandatory disclosure on firm and regulator behavior. Uncertain tax benefit (UTB) resolutions provide a unique setting to analyze the effects of reporting on behavior, as UTB unwindings result from the interactions between tax authority and taxpayer. In Chapter I, I address the disclosure environment for UTBs. In Chapter II, as additional tax disclosure may affect the detection risk associated with tax uncertainty, I hypothesize that the previously-documented increase in UTBs following a tax critical audit matter (CAM) is supplemented by a change in UTB resolutions. I find that tax CAMs significantly affect the portion of UTBs resolving via revisions of prior estimates. Thus, disclosure of tax CAMs is shown to significantly affect how UTBs resolve. In Chapter III, I hypothesize that the reduction of UTBs post-Schedule UTP, and the associated effort to minimize Internal Revenue Service scrutiny, also affects UTB unwindings. While my results do not suggest that Schedule UTP significantly impacts how UTBs resolve, they do suggest that Schedule UTP significantly impacts when UTBs resolve. Collectively, my work identifies changes in UTB unwindings as operational consequences of both audit and private tax disclosure mandates. Specifically, the evidence suggests that while public auditor-provider disclosure affects how UTBs unwind, private firm-provided disclosure affects when UTBs unwind. Thus, information source and method of communication appear to influence the relationship between disclosure and firm and regulator behavior.
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Details
- Title
- Mandatory disclosure and uncertain tax benefit resolutions
- Creators
- Carolyn Previti
- Contributors
- Anthony Paul Curatola (Advisor)
- Awarding Institution
- Drexel University
- Degree Awarded
- Doctor of Philosophy (Ph.D.)
- Publisher
- Drexel University; Philadelphia, Pennsylvania
- Number of pages
- x, 96 pages
- Resource Type
- Dissertation
- Language
- English
- Academic Unit
- Accounting; Bennett S. LeBow College of Business; Drexel University
- Other Identifier
- 991021890114204721