The Influence of Dividend Policy and Income Tax on Income Smoothing

Friska Firnanti ()
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Friska Firnanti: Accounting, Trisakti School of Management, Indonesia Author-2-Name: Author-2-Workplace-Name: Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:

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Abstract: Objective � This research aims to obtain the empirical evidence on the influence of dividend policy, income tax, firm size, profitability, and leverage on income smoothing. Methodology/Technique � In this research, income smoothing is proxied with the Eckel index and logistic regression is used to test the hypothesis. The research population consists of non-financial companies listed on the Indonesian Stock Exchange from 2013 to 2016. The sampling method used in this research is purposive sampling. The number of companies selected is 79 with 316 data. Findings � The results show that dividend policy, income tax, profitability, and leverage all have an influence on income smoothing. Meanwhile, firm size has no significant influence on income smoothing. Novelty � These findings are consistent with a firm's dividend policy and income tax having an incremental impact on income smoothing behavior. Type of Paper: Empirical.

Keywords: Income Smoothing; Dividend Policy; Income Tax; Firm Size; Profitability; Leverage. (search for similar items in EconPapers)
JEL-codes: M40 M41 M49 (search for similar items in EconPapers)
Pages: 6
Date: 2019-03-17
New Economics Papers: this item is included in nep-acc, nep-cfn and nep-sea
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Published in Accounting and Finance Review, Volume 4, Issue 1

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