This study examines whether, under a full dividend imputation system, companies defer income until tax changes beneficial to shareholders take effect. Using a sample of Australian listed companies, we find that companies manage earnings downwards via discretionary current accruals in the year preceding a reduction in personal income tax rates, and in the year preceding a change in the tax status of superannuation funds, which reverse the first year both changes operate in unison. We also examine whether such earnings management is a function of a company?s ownership structure and dividend payout policy.
|Pages (from-to)||555 - 582|
|Number of pages||28|
|Journal||Australian Tax Forum|
|Publication status||Published - 2013|