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Record W3124048339 · doi:10.1111/1911-3846.12364

The Information Content of Tax Expense: A Discount Rate Explanation

2017· article· en· W3124048339 on OpenAlexvenueno aff
Erin Henry

Bibliographic record

VenueContemporary Accounting Research · 2017
Typearticle
Languageen
FieldBusiness, Management and Accounting
TopicAuditing, Earnings Management, Governance
Canadian institutionsnot available
Fundersnot available
KeywordsEconomicsCash flowMonetary economicsEarningsTax rateVariance (accounting)MicroeconomicsFinancial economicsFinanceAccounting

Abstract

fetched live from OpenAlex

ABSTRACT I investigate the information content of income tax expense using variance decomposition to separate stock returns into cash flow and discount rate news components. While prior literature has focused on linking tax expense with expected future cash flows, I argue that tax expense should also be informative about discount rates because of its ability to summarize fundamental economic performance. Consistent with my arguments, I find that tax expense surprises are correlated with both revisions in future cash flows and revisions in discount rates; however, the economic magnitude of tax expense's impact on returns is primarily through the discount rate channel. I also perform cross‐sectional tests, which reveal that the discount rate implications of tax expense are due not only to its ability to capture fundamental economic performance but also to its ability to convey information about a firm's earnings management and tax avoidance activities.

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

How this classification was reachedexpand

Full frame machine prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.

metaresearch head score (Codex)0.003
metaresearch head score (Gemma)0.034
Version: metacan-v3-hybrid-931329e0061cValidation status: machine_predicted_unvalidated
Candidate categoriesnone
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Observational · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.005
Threshold uncertainty score0.018

Distilled classifier scores by category (both heads)

CategoryCodexGemma
Metaresearch0.0030.034
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0010.001
Bibliometrics0.0020.001
Science and technology studies0.0000.002
Scholarly communication0.0030.005
Open science0.0010.001
Research integrity0.0010.002
Insufficient payload (model declined to judge)0.0050.000

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.079
GPT teacher head0.311
Teacher spread0.232 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.

The models applied no category: nothing in the taxonomy fit this work.
Study designObservational
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations19
Published2017
Admission routes1
Has abstractyes

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