The Study Of Executive Equity Incentive To Book-tax Differences' Influence

Taxable income is based on the adjustment of accounting earnings,both are closely linked,however,due to they follow different objectives,different clients,there are some differences between them inevitablely,and this difference is increasing year by year.Previous research has found that institutional factors,earnings management and tax planning behavior are the three main reasons that lead to book-tax difference,and different reasons will have different effects on the value of the company.The book-tax differences that from Earnings management will reduce the value of the company and that from tax planning will increase the value of the company,therefore,to explore what factors will affect the source of book-tax difference becomes very important.First,the large book-tax difference is a dangerous signal for the company,on the one hand,it means that the company's earnings sustained are low,on the other hand it can also attract the attention of the relevant regulators,it makes managers increases the risk of earnings management,Therefore when large book-tax difference exist,managers will weigh earnings management activities and tax planning activities.Second,executive equity incentive as a long-term incentive system,it can establish a benefit-sharing and risk-sharing mechanism between managers and shareholders,thus managers will stand in the interests of the shareholders,more willing to engage in the economic activity that can increase the enterprise value.So we will like to know what directly or inderectly influnce does executive equity incentive system to book-tax influnce.Based on this,this article choose A-share listed companies that from Shanghai and shenzhen in 2010-2015 as research samples.To explore the executive equity incentive on the tax planning result book-tax difference and earnings management result book-tax difference's adjustment.Through empirical research we draw the following conclusions:with the increase of executive equity incentive,the book-tax difference that related to tax planning will increase,that is the executive equity incentive has the positive regulatory role to tax planning drive book-tax differences,and the positive regulatory role in the non-state enterprise was enhanced.With the increase of executive equity incentive,the book-tax difference that related to earnings management will decrease,that is the executive equity incentive has the negative regulatory role to earnings management drive book-tax differences,and the negative regulatory role in the non-state enterprise was weakened.This thesis includes six parts:The first part is the introduction.This part introduces the research background,theoretical and practical significance,research contents,methods,and innovations in this paper.The second part is the literature review.Mainly describe the causes of book-tax differences and its economic consequences,the relationship between executive equity incentive and book-tax differences,the relationship between executive equity incentive and earnings management,the relationship between executive equity incentive and tax planning,finally make a summarize about the present situation of research.The third part are theoretical analysis and research hypothesis,theoretical analysis is a general overview of the relevant theories,including principal-agent theory,interest convergence,opportunism behavior effect and reputation effect,Based on the theories hypotheses are put forward.The fourth part is the specific research design,including the selection of variables and the model design,data sources and sample selection and testing methods.The fifth part is the empirical test results,mainly basis on the designed research plan and the analysis of sample data,verify the hypothesis and draw the corresponding conclusions.The sixth part are research conclusions and policy recommendations,as well as research deficiency and the outlook for future research.Innovation and contribution of this paper is:First of all,this paper from the perspective of the factors that affect the source of book-tax difference indirectly inspects the equity incentive salary system's impact on the book-tax difference.At the same time,the study of this article further indicate the important influence that compensation system to company value,The innovate of the reserch angle is the biggest innovate in this article;Second distinguish the different property nature of the state-owned enterprises and non-state-owned enterprises,verify the non-state enterprise equity incentive's different influence of regulatory to book-tax differences' source,help the listed companies according to different property nature to develop a more effective incentive mechanism;Finally,in the empirical model for executive equity incentive's measure,broke the previous scholars adopt executives shareholding as substitution variables,this paper adopted the restricted shares and the value of the stock option held by the executive value divided by stock options value and the proportion of the monetary compensation sum as a measure of the degree of equity incentive,this measure method is more comprehensive and objective.