• Management & Information Systems Review
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• v.17
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• pp.335-358
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• 2005

The purpose of this study is in investigating the tax clients for their relationship with tax preparers and the general levels of characteristics for the taxation objects, and establishing significant relationships of the two major factors-satisfaction factors and characteristics of the clients-on the satisfaction of the clients. The results of this study will provide an important basic data required for rational management of tax clients. A total of 20 sub-hypotheses were used, which can essentially be summarized into the following three major statements. The hypotheses investigation results can be summarized as below. First, as for the characteristic factors of the preparer, the taxation knowledge factor and the client satisfaction factor were found to be in a significant median positive relationship, and the experience factor and the client satisfaction factor were found to be in a relatively less significant relationship. Second, the factor on the relationship with the preparer and the client satisfaction factor were all found to be in a highly significant positive relationship. Third, in order to measure the characteristics of the taxation objects, relationships between potential tax reductions factor, probability of taxable income adjustments factor, and the client satisfaction factor were analyzed, and they were found to have positive relationships of relatively high significance. Fourth, the average for the client satisfaction factor by industry was found to be the highest for the manufacturing industry, followed by wholesalers and retailers. Other sectors showed little deviation from the average of 4.9, but this factor was not statistically significant. Fifth, the average difference examination of the satisfaction levels for the clients with or without experience of taxable income adjustments showed that those without experience of taxable income adjustments had higher satisfaction levels. Sixth, 12 study hypotheses had been proposed in order to investigate the relationship between the client satisfaction factors and the client satisfaction levels according to the characteristics of clients. Among the 12 sub-hypotheses, except for the study hypothesis of investigating the relationship between the tax preparer's taxation knowledge and the client's satisfaction levels according to the experience of taxable income adjustments, 11 study hypotheses were all not adopted.

• Management & Information Systems Review
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• v.35 no.2
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• pp.83-97
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• 2016

The purpose of this study is to evaluate our system and consider how the tax rules on corporate reorganization and asset adjustment account can be improved. The scope of this study includes the Korean tax rules on corporate reorganizations, as well as key tax benefits provided by the Special Tax Treatment Control Act. In case of Korea, The relevant regulations and system of taxation respecting the merger has been made the rapid progress in several respects in this situation, there are capable of improvement. This paper suggests improve some problems on tax avoidance abusing incomplete tax law. First, the asset adjustment account is the difficulty that it needs to follow-up during this period of time, as well as the complexity of the accounting and tax adjustments on the practice. If it is permitted to succeed asset-liability as market value, the complexity of asset adjustment account in corporate tax accounting also disappear. Second, in case that controlling shareholders possess more than 20% of merged entity, they could not get the tax deferral until after the time of two years has elapsed. It needs to further alleviate the merged entity ratio than the present level. Finally, after the merger it will be to strengthen the surveillance provisions of five years from the current two years. In addition, continuity of shareholder's requirements and business requirements, it is also necessary to strengthen the requirements of the follow-up provided by a separate regulation.

• Management & Information Systems Review
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• v.36 no.3
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• pp.255-268
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• 2017

This study examines whether firms with tax avoidance of Corporate Social Responsibility(CSR) performance is tempered by the extent firms engage in CEO turnovers. Considering the increasing interest in CSR activities of the firm to secure sustainable growth of national economy, this paper investigates the benefit and cost of CSR activities by combining the agency theory using the firm level data. Prior studies document that investors positively value tax avoidance. The rationale for this finding is that tax avoidance provides cash savings that can be used by firm managers to generate future shareholder wealth. Prior studies also show that investors' valuations are sensitive to the risk of future negative tax outcomes. Assuming that many types of CSR performances are low risk, low yielding uses of firm resources, we posit that higher levels of CSR performance may signal to investors that cash generated via tax avoidance has not been fully used to generate a return sufficient to offset the risk associated with aggressive tax planning strategies. Consistent with this argument, we predict and find that the positive association between CSR performance and tax avoidance is significantly weakened when firms have higher positive levels of CEO turnovers. Further, we predict and find that 'philanthropic' types of CSR activities in particular are associated with investor discounting of tax avoidance. We interpret our results as suggesting the equity market views CSR activities to be ostensibly funded through cash savings generated via tax avoidance.

• Management & Information Systems Review
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• v.23
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• pp.157-174
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• 2007

Concerning this nation's M&A system, it is expected that standards of limitation on ownership is considerably modified and alleviated. This would allow companies to freely merge with each other, raising the efficiency of the whole national economy and ultimately benefiting all economic subjects. Another goal of business merger lies in adjusting net income or reducing tax amount. The income and the amount are to be financially reported. If merger between companies does not create any synergy effect, but just contributes to net income increase or tax reduction for the purpose of the parties' financial reporting, it might distort a rational distribution of wealth over all facets of economy. Merger whose goal is to create the most desirable synergy effect should be positively encouraged, but that whose goal lies in tax avoidance needs to be strongly restricted. Thus the purpose of this study was to find how to improve this nation's merger-related taxation system. For the purpose, this researcher investigated problems of existing tax supports to merger, which meets related taxation requirements, especially in terms of liquidation income, appraisal profit from merger, fictitious dividend and requirements for taxation. Among the problems, the study found, the biggest thing was that liquidation income or deficit carried forward, if any, is subject to be prior deducted from surplus, so the income is likely to generate. To raise the consistency of this nation's taxation on business restructuring, existing local systems in regard to merger, division, investment in kind and dividend-exclusion method need to be reconsidered following the introduction of consolidated taxation system.

• Management & Information Systems Review
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• v.7
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• pp.401-426
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• 2001

The form of company divides private and coporate companies. In general. private company has direct connection with owner's fortunes. On the contrary, cooperate company is established by a group of people who invest capital funds on their company and has an independent character. In the case of private company, their are many merits that owner can obtain all the benefits without divisions. However, the owner can mix up the control of accounting between public and private matters. As a result confusing, it is difficult to estimate financial situation of company and is limited to fund supply. Futhermore, owner has unlimited liabilities with law credit as a social cognition. Especially, the government tries to induce conversion of private company into cooperation one on the basis of benefits of tax and so on. In those situations, the purpose of this thesis is to study the management benefits with the conversion of private company into cooperate one focucing on the related tax reduction effect. To do this, I have reviewed all of the related textual achievements and tested the real significancy of tax reduction effect of conversion empirically. Finally, I have concluded that the conversion of private company into coporate one has many benefits including significant tax reduction effect. In other side, I have considered and reviewed many difficulties related conversion privated company into cooperate one and suggested some improvements as results. This thesis is comprises 5 chapters as follows; The first chapter explains purposes and methodologies and extents of this study. The second chapter deals the theoretical basis of conversion of private company into cooperate one and cooperates diverse benefits and types and processes of conversion. The preceding research achievements are also reviewed in this chapter. The third chapter deals empirical testing on the real tax reduction effect of the conversion. The analysis is proceeded through t-test of difference of tax between pre and after conversion. The result is presented so positively that I can conclude that cooperate conversion of private company has real benefit of tax reduction. The forth chapter deals the difficulties and improvements related with conversion. They are considered and reviewed at various aspects such as practical, financial and tax aspect. In fifth chapter, I summarise all of the significant points of this study and have conclusions in various aspects at last. In final point, this study is not enough in sample numbers and sample collecting area for empirical testing of significant tax reduction effect of cooperate conversion and research of more foreign achievements. Those are remained as continuing future studies.

• Management & Information Systems Review
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• v.35 no.4
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• pp.169-184
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• 2016

Deferred tax assets (liability) in a company's financial statements are to reflect the temporary difference between taxable income and accounting income and therefore can provide useful information as a proxy for discretionary accruals. In addition, deferred tax assets allow a company to manage its earnings by reviewing the feasibility of the assets' recognition. As such, this study focused on deferred tax assets to examine their relationship with discretionary accruals, which were measured by a modified Jones model (Dechow et al. 1995), and investigated the impact of audit quality on this relationship. In order to control for the effects of tax rate change and measurement credibility, deferred tax assets of 2,670 non-financial firms from 2009 to 2010 were collected as samples for the study. The results of the empirical analysis are as follows. First, the samples as a whole indicated that deferred tax assets have a negative relationship with discretionary accruals in a general sense, but a high-quality audit did not reveal a significant relationship between them. Second, the 1,379 samples with negative discretionary accruals did not reveal a significant relationship between deferred tax assets and discretionary accruals; however, the result showed a significant negative relationship under a high-quality audit. These findings suggest that in the case of negative discretionary accruals, a high-quality audit restricts an earnings management technique that utilizes deferred tax assets and that the assets can be a useful tool for detecting discretionary accruals. The present study is meaningful in that, unlike previous research, it combined the two contrasting roles of deferred tax assets-that of an earnings management detector and an earnings management tool-to examine their general relationship. The study also suggested that audit quality could influence the usefulness of deferred tax assets in providing information on discretionary accruals.

• Management & Information Systems Review
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• v.35 no.2
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• pp.67-81
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• 2016

The purpose of this study was to investigate lots of problems that the current tax appeal system has, which are becoming serious issues as tax appeal cases are recently increasing. Those problems include the unreasonable procedure and period of deliberation on tax appeal cases, permission of a same tax appeal by more than one governmental agencies and the compulsory transposition system of tax appeal cases. All of these problems should be rectified in order to ensure that the currently tax appeal system protect taxpayers' rights and interests effectively. According to the current tax appeal system, the period from the receipt of tax appeal cases to ruling on them is up to 90 days. This is unrealistic, so that period should be allowed to be extended if those cases about more complicated taxation or if they are even harder to be treated for any reason. At present, chief of Tax Tribunal has to unconditionally accept resolution from the meeting of tax judges and make a ruling accordingly because he has no right to reject that resolution. But now, it's time to establish legal grounds based on which the chief suggests the tax judges to reconsider their resolution if it is undoubtedly wrong. Currently, there's a relatively little acceptance of tax appeals from people who can't financially afford to designate a proxy for them. To solve this problem, lots of efforts to make socially recognized the necessity to relive those people's rights and interests and make widely known the Public Proxy of Tax Appeal System. The current tax appeal system allows the Board of Audit and Inspection to be an appealer. This means taxation may be deliberated on by more than one governmental agencies. It is so inefficient. Therefore, tax appeal by the board should be only about taxation that they found unacceptable by audit and inspection. Except for this, it is not allowed that the Board of Audit and Inspection file tax appeals that are, in turn, necessarily transported to the National Taxation. Esecially, the transposition should be a procedure that is occasionally taken. In sum, this study investigated problems with the current tax appeal system, and made suggestions about solutions that are not theoretical but practical.

• Management & Information Systems Review
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• v.36 no.1
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• pp.215-232
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• 2017

[Purpose] The purpose of this study is to point out the issue of pensions and retirement income tax which were amended from 2012 to 2016 and present a rational and intellectual improvement to this issue. [Methodology] This study was carried out a literature survey about the tax laws of pension income and retirement income. In order to confirm the differences between the case-by-case tax burden, calculated the effect of tax burden by presenting the examples in the case of retirement income. [Findings] It is necessary to apply the differential multiples in accordance with the seniority when leaving the company rather than applying the five times or 12 times in the tax base as the current retirement income tax. Also, It should be given the flexibility of pension income to ease the requirements of inevitable temporary receipt of a pension income. In addition, it is needed to expand separate taxation threshold which is current 12 million won. Finally, the annual limit of tax incentives for IRP should be increased significantly more than the current 7 million won. [Implications] The improvement of the study is to offer suggestions on the revision of retirement income and pension income taxation to the tax authorities or National Pension Service and retirement pension providers. The result of this study is expected to be used as reference to develop policy options on the legislative process.

• Management & Information Systems Review
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• v.32 no.1
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• pp.195-216
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• 2013

This Study investigates evaluation policies for goodwill under the current tax law and suggests improvements as follows. First, even though not appear on the financial statements of acquiree at the date of acquisition, the current corporate tax raw regulates that firms need to estimate purchased goodwill including acquisition amount and additionally recognizable intangible property right with no distinction. According to this rule, purchased goodwill from business combination under the current tax raw has a drawback in overestimating. So, there is need of further improvement on the current related purchased goodwill regime to distinguish additionally recognized intangible property right from purchased goodwill. Second, in the consideration of internally generated goodwill, suggested in the current inheritance and gift tax act as a supplementary evaluation technique, the estimated value of goodwill may contain some bias, since the current regulation uniformly applies to all the companies with no industry characteristics. This may particularly become problematic while computing abnormal earnings, uniformly applying the 10% normal return to all the companies since the normal return is not likely to reflect industry characteristics and thus the computed abnormal earnings may be biased. Therefore, there is need to revise the current regulation relating to the normal return, to convert from the existing 10% rule to the industry average rate of return method.

• Journal of Digital Convergence
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• v.19 no.9
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• pp.181-188
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• 2021

Research and importance of legal services applied with AI so that it can be easily understood and predictable in difficult legal fields is increasing. In this study, based on the decision of the Tax Tribunal in the field of tax law, a model was built through self-learning through information collection and data processing, and the prediction results were answered to the user's query and the accuracy was verified. The proposed model collects information on tax decisions and extracts useful data through web crawling, and generates word vectors by applying Word2Vec's Fast Text algorithm to the optimized output through NLP. 11,103 cases of information were collected and classified from 2017 to 2019, and verified with 70% accuracy. It can be useful in various legal systems and prior research to be more efficient application.