BOOK-TAX DIFFERENCES E GERENCIAMENTO DE RESULTADOS NO MERCADO DE AÇÕES DO BRASIL

• Main Authors: Renato Rovetta Passamani, Fábio Moraes da Costa, Antonio Lopo Martinez, Felipe Ramos Ferreira
• Format: Article
• Language: English
• Published: Fundação Getulio Vargas 2012-09-01
• Series: RAE: Revista de Administração de Empresas
• Subjects: Book-tax differences; earnings management; discretionary accruals; earnings quality; equity market
• Online Access: http://rae.fgv.br/sites/rae.fgv.br/files/artigos/10.1590_0034-75902012000500001.pdf

This study aimed to investigate the relationship between book-tax differences (BTD) and earnings management in firms listed on the BM&F Bovespa. The final sample consisted of 485 observations (firm-year) and the analysis included the period from 2005 to 2009. Methodologically, two approaches were employed in this study: (i) frequency distribution and (ii) discretionary accruals – Modified Jones Model. The findings indicate a directly proportional relationship between BTD and discretionary accruals. There was evidence that the firms manage their earnings in the same direction of the observed signal of BTD, and seek to present the amount of BTD in level and variation around the breakeven and thus avoid a relationship with low earnings quality. Additionally, evidence indicate that the size of firm and the adoption of the tax basis transition are inversely related to the level of discretionary accruals.