Research On The Value-Relevance Of Income Tax Accounting

Income tax accounting which is gradually with international standards achieve the separation of accounting and tax, with the integration of Chinese enterprises’accounting standards with the international. The survey shows that, most listed companies and large and medium-sized enterprises account their incoming tax by using taxes payable method which is simple and easy in income tax accounting, before the promulgating of the income tax accounting standards. Accounting Deferred income tax assets and liabilities according to balance sheet approach becomes the only accounting choice of listed companies, since the promulgating of the income tax accounting standards in2007. The assets and liabilities of deferred income tax become a important statement in balance sheet.This paper does a thorough empirical research base on residual income valuation model in the correlation between deferred tax assets and liabilities after the promulgating of the income tax accounting standards. This paper uses the panel data to fix effects and random effects test and eliminates the scale effect base on the base research.This paper expands the research in the classification of the ultimate controller by adding control variables. The research shows that:(1Significant explanatory power of The deferred tax assets on value.(2) Higher correlation on value per share with deferred Income Tax than without it.(3) Deferred income tax assets have Higher correlation on vlaue than deferred income tax liabilities.(4) Both of Deferred income tax assets and Deferred income tax liabilities on value ratio can significantly explain the growth rate of the value by adding the eliminate scale effect model and adding the control variables.At last, according to conclusions, income tax accounting reform in China is of positive significance, and provides more useful accounting information, and proposes several recommendations.