Research On The Impact Of The Book-Tax Differences On Future Earnings Growth

Accounting earnings is an important index of financial analysis,in the investment market,earnings have both quantitative and qualitative attributes,which is an important reference for investors before making decisions.As a rational economic person,enterprise managers often selectively disclose financial data,or even publish whitewashed earnings information,the authenticity of accounting earnings and the quality of earnings difficulty in identifying,This makes the decision-making of earnings information much less useful.How to use the available earnings data to make a reasonable and effective prediction of the future earnings situation is a key problem in the field of accounting theory and practice in recent years,and it is also a hot topic of continuous discussion.As China's Accounting Standards for Business Enterprises(hereinafter referred to as the Standards)and The Law of People's Republic of China on Enterprise Income Tax(hereinafter referred to as the Income Tax Law)gradually converge with the international,the trend of the book-tax separation becomes more and more obvious.The new law gives enterprises more space and autonomy in policy choice,and the book-tax differences exist widely and cannot be eliminated.The difference of the book-tax is not only caused by the different policies and regulations,but also influenced by artificial manipulation.The theorists agree that there are three main sources of the book-tax differences: policy differences,earnings management,and tax avoidance.A large number of studies at home and abroad show that the book-tax differences have rich information content to measure earnings quality,and earnings quality is an important feature of predicting future earnings growth,which has important reference significance for financial analysis and earnings forecasting.In order to reveal the information content and reference value of the differences between China's A-share companies,this paper studies the earnings growth of A-share listed companies in China from the perspective of tax differences.The scope of the study is extended to the different sources of the book-tax differences to explore its impact on the future earnings growth of the company.We try to make investment decisions for investors,maintain long-term steady earnings growth of listed companies,harmonize the relationship between legislation and income tax law,and effectively identify the quality of earnings of listed companies.And the financial analysis and earnings forecast of listed companies provide a new perspective and direction.Based on the data of A-share listed companies in China,this paper selects the sample from 2009-2016 as the main body of the study,taking the different sources of the book-tax differences as the basis of classification,while studying the impact of the differences on the future earnings growth of the companies at the same time.Further study policy differences,earnings management,tax avoidance behavior on the future earnings growth of listed companies.Through theoretical analysis and empirical research,this paper finds that there is a significant negative correlation between the book-tax differences and the earnings growth in the future.At the same time,there is a negative correlation with policy differences,earnings management and tax avoidance behavior.In other words,the greater the book-tax differences,the less likely future earnings growth of listed companies.This study provides an effective method for investors,listed companies and legislatures to identify earnings quality and earnings growth,and puts forward suggestions to further standardize the capital market.