1- Urmia University
2- Urmia University ,f.ghayour@urmia.ac.ir
2- Urmia University ,
Abstract: (19 Views)
Managing corporate earnings through strategies such as reducing tax payments is a key mechanism used to address conflicts of interest between managers and owners. Tax risk—defined as the possibility of unexpected changes in tax regulations, including adjustments in tax rates, modifications to tax calculation and payment rules, amendments to income-related regulations, and other major shifts in tax systems—can significantly influence a firm’s financial and investment decisions. This study aims to examine the effect of the likelihood of fraudulent financial reporting on tax risk across different stages of the corporate life cycle. To achieve this objective, a sample of 172 firms was analyzed over the period 2016 to 2025. Multiple regression analysis was employed to test the research hypotheses. The findings indicate that tax risk increases as the likelihood of fraudulent financial reporting rises. Based on the analysis, the findings further indicate that the effect of the likelihood of fraudulent reporting on tax risk varies across the different stages of the corporate life cycle. Specifically, this effect is more pronounced during the decline stage compared to other stages. The results of the study suggest that tax risk is a phenomenon contingent on the company's life cycle conditions and cannot be analyzed independently of the organization's specific institutional and fundamental context.
Type of Study: Research |
Subject:
Accounting
Received: 2025/06/24 | Accepted: 2026/09/1 | Published: 2026/09/1
Received: 2025/06/24 | Accepted: 2026/09/1 | Published: 2026/09/1
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