The Effect of Ownership Structure, Cash Holding and Tax Avoidance on Income Smoothing

Nico Alexander. 2019. The Effect of Ownership Structure, Cash Holding and Tax Avoidance on Income Smoothing, J. Fin. Bank. Review, 4 (3): 128 – 134 DOI:10.35609/jfbr.2019.4.4(3)

7 Pages Posted: 10 Mar 2020

Date Written: December 31, 2019

Abstract

Objective - This study aims to undertake an empirical study of the influence of ownership structure, cash holding, and tax avoidance on income smoothing.

Methodology/Technique – Ownership structure in this research is measured by public ownership and managerial ownership. The population of this research are manufacturing companies listed on the Indonesian Stock Exchange (IDX) between 2015-2017 and there are 50 companies that meet the criteria and serve as the research sample. The sample selection in this study uses purposive sampling and the hypotheses were tested using binary logistics.

Findings – The results of this study show that managerial ownership and public ownership, cash holding by companies and tax avoidance do not have influence on income smoothing. These results show that managerial ownership and public ownership do not affect income smoothing because there are same interest, to improve their wealth. Similarly, neither how much cash is held by a company nor tax avoidance behavior effect income smoothing.

Type of Paper - Empirical.

Keywords: Income Smoothing; Ownership Structure; Cash Holding; Tax Avoidance

JEL Classification: G23; G28

Suggested Citation

Alexander, Nico, The Effect of Ownership Structure, Cash Holding and Tax Avoidance on Income Smoothing (December 31, 2019). Nico Alexander. 2019. The Effect of Ownership Structure, Cash Holding and Tax Avoidance on Income Smoothing, J. Fin. Bank. Review, 4 (3): 128 – 134 DOI:10.35609/jfbr.2019.4.4(3), Available at SSRN: https://ssrn.com/abstract=3534120

Nico Alexander (Contact Author)

Trisakti School of Management ( email )

Jakarta
Indonesia

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