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Earnings Management, Effective Tax Rate (Etr) And Book-Tax Gap (Btg)


  • Jasrial

    (Universitas Terbuka, Jalan Cabe Raya, Pamulang, 15418, Tangerang Selatan, Indonesia Author-2-Name: Susy Puspitasari Author-2-Workplace-Name: Universitas Terbuka, Jalan Cabe Raya, Pamulang, 15418, Tangerang Selatan, Indonesia Author-3-Name: Ali Muktiyanto Author-3-Workplace-Name: Universitas Terbuka, Jalan Cabe Raya, Pamulang, 15418, Tangerang Selatan, Indonesia)


Objective � This research examines the effect of company size, changes in out-cash flow, return on assets, conservatism, and profit levelling on earnings management. Methodology/Technique � The results of this research show that banking capital structure, capital intensity, intensity of inventory, and intensity of R & D have a significant impact on effective tax rates. Further, the results also show that, with respect to the non-banking sector, R & D expenditure contributes significantly to effective tax rates. Simultaneously, earnings management and effective tax rates, as well as other factors, also have an effect on book tax gap. Findings � This study shows that profit management has a significantly positive effect on book tax gap, and effective tax rates has a significant negative effects o book tax gap. In terms of the non-banking sector, earnings management and effective tax rate have no effect on book tax gap. Deferred tax expenses have a lower capability to detect earnings management than accrual, in both the banking and non-banking sector. Novelty � The study of management capabilities optimizes the role of book tax gap and effective tax rate for earning management. Both tax management and earnings management are closely related to behavior management in managing a company based on the agency theory. Furthermore, the study identifies a relationship between earnings management and book tax gap

Suggested Citation

  • Jasrial, 2018. "Earnings Management, Effective Tax Rate (Etr) And Book-Tax Gap (Btg)," GATR Journals afr155, Global Academy of Training and Research (GATR) Enterprise.
  • Handle: RePEc:gtr:gatrjs:afr155

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    Book Tax Gap; Effective Tax Rate; Earnings Management; Accrual Total; Indonesia.;
    All these keywords.

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H29 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other

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