Matching Items (3)
Description
In this study, I predict that involvement in a fraud-related securities class action lawsuit is associated with a change in political activity patterns toward less transparent channels and a reduction in the quality of public political disclosures. Allegations of fraud may impair a firm’s reputation and cause the firm to reevaluate the effectiveness of its political strategies. I find evidence that firms involved in a fraud-related securities class action lawsuit are associated with less political action committee (PAC) contributions and more lobbying after the accusation. I find a similar pattern for additional measures of transparency: firms shift from in-house lobbying to contract lobbying, are more likely to spend through their subsidiaries, and increase activity through their subsidiaries in the period after the fraud-related securities class action lawsuit. I also find that firms significantly reduce the level of their voluntary political spending disclosures. Overall, my results provide evidence of a change in real activities and disclosures after an accusation of fraud. While prior research documents that firms generally work to improve their reputations following a fraud, I find evidence that firms reduce the transparency of their corporate political spending and related disclosures.
ContributorsPaparcuri, Christina Marie (Author) / Brown, Jennifer L (Thesis advisor) / Huston, George R (Committee member) / Kenchington, David G (Committee member) / Arizona State University (Publisher)
Created2021
Description
This study examines determinants of the length of conflict between firms and the Internal Revenue Service (IRS). I hand collect firm disclosures of the number of years open for federal tax purposes to create a proxy for IRS conflict length. Using this proxy, I find evidence that larger firms, firms with more book-tax differences, and firms facing higher IRS attention and audit probabilities are associated with lengthier IRS conflicts. In contrast, firms with higher deferred tax assets, intangibles, return on assets, and firms disclosing participation in the Compliance Assurance Process program are associated with shorter IRS conflicts. Additional analyses show IRS conflict length is positively associated with manager risk preferences and poor tax accounting quality. I also find lengthier IRS conflicts are associated with higher future tax risk and higher audit fees. Tax controversy is becoming increasingly important for firms but remains relatively understudied. I provide empirical evidence on cross-sectional variation in IRS conflict length.
ContributorsPaparcuri, Christian Simon (Author) / Brown, Jennifer L. (Thesis advisor) / Huston, George R (Committee member) / White, Roger M. (Committee member) / Arizona State University (Publisher)
Created2020
Description
States place a heavy reliance on sales tax revenues to finance government activities. The rise in e-commerce, coupled with constitutional restrictions on imposing sales tax nexus, has resulted in a decline in sales tax revenues in many states. States have responded by enacting legislation and reinterpreting existing statutes to curb these declining revenues. This study provides evidence that sales tax revenues are larger after states enforce some, but not all, sales tax measures aimed at imposing nexus on Internet retailers. Further evidence suggests a shift in consumer preferences to local consumption in states enforcing broadened nexus, as evidenced by greater state-level retail gross domestic product (GDP) after states enforce broadened sales tax nexus. Additionally, the number of physical establishments of Internet retailers is lower after states expand sales tax nexus, suggesting these retailers remove their physical presence in states to avoid collecting sales taxes. Finally, the increase in retail GDP has a spillover effect on corporate income taxes, with states enforcing broader sales tax nexus on Internet sales realizing larger corporate income tax revenues.
ContributorsWenzel, Brian S (Author) / Brown, Jennifer L. (Thesis advisor) / Hugon, Jean A (Committee member) / Huston, George R (Committee member) / Arizona State University (Publisher)
Created2017