EFFECT OF INCOME TAX ON EARNINGS MANAGEMENT OF LISTED COMPANIES IN NIGERIA

This study examined the Impact of Income Tax on Earnings Management of Listed Companies in Nigeria. The study adopted the ex-post facto research design. In order to determine the effect of Income Tax on Earnings Management of Listed Companies in Nigeria. Income tax was measured using Current tax paid (CTP) and Deferred Tax (DFT). Ex-post facto research design was adopted and data for the study were obtained from annual accounts of sampled firms for a period of 10 years (2013-2022). Two hypotheses were formulated and tested using multiple regression, with the aid of STATA statistical tool. From the analysis done, the study found that there’s no significant relationship and impact of Income Tax on Earnings Management of Listed Companies in Nigeria. The non-significant relationships between income tax variables (CTP, DFT) and earnings management suggest that, in the context of listed firms in Nigeria, income tax payments and liabilities do not appear to be major drivers of earnings management practices. The study recommended that The Nigerian government can enhance tax transparency by providing clearer guidance on tax laws and regulations. This can help companies better understand their tax obligations and reduce the incentives for earnings management aimed at tax optimization and also, Companies should provide comprehensive and transparent disclosures regarding their tax positions, including any uncertainties or contingencies related to income tax matters. Keywords: Income Tax, Earnings Management, Current Tax, Deferred Tax