Evolving Connections Between Tax and Financial Reporting in Italy

Giovanna Gavana (), Gabriele Guggiola and Anna Marenzi
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Giovanna Gavana: Department of Economics, University of Insubria, Italy
Gabriele Guggiola: Department of Economics, University of Insubria, Italy

Economics and Quantitative Methods from Department of Economics, University of Insubria

Abstract: This paper analyzes the evolution of the relationship between tax and financial reporting in Italy after the mandatory introduction of IFRS for listed companies in 2005. In order to assess this link we will use the methodology developed by Lamb et al. (1998). Italy represents an interesting case study because IFRS have become mandatory, for listed companies, also for what concerns individual, and fiscally relevant, accounts. Therefore, two accounting systems, one based on IFRS and one based on Italian Gaap coexist, originating the emergence of two rather different linkages between tax and financial reporting. IFRS and tax reporting exhibit an high degree of disconnection, while Italian Gaap, according to a continental European accounting tradition, are heavily linked to fiscal rules. The analysis will point out a rapidly evolving situation, with links between both accounting systems (IFRS and Italian Gaap) and tax reporting getting tighter as a consequence of last years tax reforms. JEL Classification: H20, M41

Keywords: Taxation; Accounting; International Financial Reporting Standards (IFRS) (search for similar items in EconPapers)
Pages: 27 pages
Date: 2010-01
New Economics Papers: this item is included in nep-acc
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Citations: View citations in EconPapers (3)

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