Accounting Firms and Tax Aggressiveness
type: CreativeWork
description: This thesis is motivated by reported instances of opportunistic aggressive tax positions taken by large corporations across the globe. The role of professional service providers in delivering various types of tax services, especially the role of accounting firms which provide audit services at the same time to their clients, has received significant public attention. One salient concern is the appropriateness of an audit division reviewing the work conducted by the tax division of the same accounting firm. During the conduct of financial statement audits, the audit engagement team undertakes detailed examinations of the validity and reasonableness of tax-related accounts in financial reports. In situations where the tax division of an audit firm has been engaged to provide tax-related services, this could impact the incentives of the accounting firms in enabling or constraining clients’ tax aggressiveness. This thesis is comprised of three related studies that provide empirical evidence of associations between accounting firms and client firms’ tax aggressiveness. Study One examines whether accounting firm office size affects corporate tax aggressiveness. Study Two explores the association between different auditor characteristics (i.e., group audit arrangements and Big 4 identity) and the tax aggressiveness of multinational enterprises (MNEs). Study Three investigates whether corporate tax aggressiveness is associated with auditors’ propensity to issue first time going-concern opinions. In addition, these three studies also explore whether factors such as whether an audit firm also provides tax services to clients, the existence of audit or tax-specific expertise, and client importance, could moderate associations between auditor characteristics and client firms’ tax aggressiveness. Study One (accounting office size study) uses a large U.S sample covering the period from 2003 to 2017 and finds that clients audited by large audit offices have lower levels of corpora…
abstract: This thesis is motivated by reported instances of opportunistic aggressive tax positions taken by large corporations across the globe. The role of professional service providers in delivering various types of tax services, especially the role of accounting firms which provide audit services at the same time to their clients, has received significant public attention. One salient concern is the appropriateness of an audit division reviewing the work conducted by the tax division of the same accounting firm. During the conduct of financial statement audits, the audit engagement team undertakes detailed examinations of the validity and reasonableness of tax-related accounts in financial reports. In situations where the tax division of an audit firm has been engaged to provide tax-related services, this could impact the incentives of the accounting firms in enabling or constraining clients’ tax aggressiveness. This thesis is comprised of three related studies that provide empirical evidence of associations between accounting firms and client firms’ tax aggressiveness. Study One examines whether accounting firm office size affects corporate tax aggressiveness. Study Two explores the association between different auditor characteristics (i.e., group audit arrangements and Big 4 identity) and the tax aggressiveness of multinational enterprises (MNEs). Study Three investigates whether corporate tax aggressiveness is associated with auditors’ propensity to issue first time going-concern opinions. In addition, these three studies also explore whether factors such as whether an audit firm also provides tax services to clients, the existence of audit or tax-specific expertise, and client importance, could moderate associations between auditor characteristics and client firms’ tax aggressiveness. Study One (accounting office size study) uses a large U.S sample covering the period from 2003 to 2017 and finds that clients audited by large audit offices have lower levels of corpora…
author: Fu, Yi
language: EN
keywords: Going Concern, Audit Firm, Tax Aggressiveness, Group Audit
license: https://purl.org/coar/access_right/c_abf2
license: https://creativecommons.org/licenses/by-nc-nd/3.0/au/
date published: 2020
date modified: 2026-07-24T05:33:55Z
provider: University of New South Wales
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: UNSW, Sydney

PropertyValue
property ID: Handle
value: http://hdl.handle.net/1959.4/70655

PropertyValue
property ID: DOI
value: 10.26190/unsworks/2218