CORPORATE TAX AGGRESSIVENESS AND VALUE OF LISTED MANUFACTURING COMPANIES IN NIGERIA: THE MODERATING EFFECT OF AUDIT QUALITY

CORPORATE TAX
AGGRESSIVENESS AND VALUE OF LISTED
MANUFACTURING COMPANIES IN
NIGERIA: THE MODERATING EFFECT OF
AUDIT QUALITY
Daniya Adeiza Abdulazeez
Department of Entrepreneurship and
Business Studies, Federal University of
Technology, Minna, Niger State –Nigeria
A PhD (Accounting) Student at Bayero
University, Kano-Nigeria
daniyad3rd@yahoo.com
ABSTRACT
Corporate organizations are established and
owned by Shareholders through pooled
resources to achieve well established goal(s),
the core of which is value maximization. In
order to maximize firm’s value, several profit
maximization strategies such as: excellent
inventory management practice, Corporate
Social Responsibility, sound Internal Control
System, good corporate governance practice,
among others, are often put in place by
managers. However, all these strategies will
lead to increased profit that may be raked
into government coffers via taxation, if
mangers fail to organize the activities of the
corporations to legally reduce tax liability
through
effective
tax
planning/aggressiveness measures. This is
necessary to reduce the transfer of firm’s
profit to the government thereby reducing
shareholders’ value. This shows that a clear
relationship exists between corporate tax
aggressiveness and firm value. The need for
corporations to be tax aggressive stemmed
from government renewed
efforts to generate more revenue through
indirect tax and corporate organizations are
at the heart of government tax aggressive
drive due to the myriad taxes paid by
corporations. Given the aforesaid, this study
Accounting and Finance Research Association
seeks to examine how corporate tax
aggressive practice put in place my Directors
of manufacturing companies (Consumer
Goods and Industrial Good Sub-sectors) in
Nigeria has affected shareholders value for a
period of 10 years (2008-2018). This study
will also examine the role of audit quality in
strengthening the relationship between
corporate tax aggressiveness and firm value.
While, corporate tax aggressiveness will be
examined through: Long Run Cash
Effective Tax Rates, Book Tax Difference, Tax
Savings and Tax Shelter, Firm value will be
proxied using Tobin’s
Q. Audit Tenure which this study considered
appropriate
in
guaranteeing
audit
independence will be used to measure audit
quality. The study also recognizes factors
other than the captured corporate tax
aggressiveness measures that may also
affect firm value and those factors will be
controlled for; using Leverage,
Institutional Shareholding, and Firm Size. In
other to achieve the objectives of this study,
Ex-post facto correlational research design
will be employed due to the nature of the
data to be used in this study which will be
extracted from the annual reports and
accounts of the companies being
investigated. The study has a population of
25 Companies and through census approach,
all the companies will be taken as the
sample size. In analyzing the data,

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