REVIEW JURNAL : Effect of Tax Planning on Firms Market Performance: Evidence from Listed Firms in Ghana

REKAP ISI JURNAL ILMIAH

UNTUK KAJIAN PENELITIAN YANG RELEVAN

NamaPengutip: Rinny Viany S                                               Hari/Tgl Pengarsipan: 16 Oktober 2014

No	ASPEK JURNAL	SUBSTANSI/ ISI JURNAL DIKUTIP
1	Judul /title:	Effect of Tax Planning on Firms Market Performance: Evidence from Listed Firms in Ghana
2	Nama penulis :	by Seyram Kawor & Holy Kwabla Kportorgbi
3	Nama, edisi, halaman jurnal :	International Journal of Economics a nd Finance; Vol. 6, No. 3; 2014 ISSN 1916-971X   E-ISSN 1916-9728 Published by Canadian Center of Science and Education
	Sumber/bentuk	http:// www.ccsenet.org/ijef
4	Setting  penelitian
	A. Tempat penelitian :	Department of Accounting and Finance, University of Cape Coast, Ghana
	B. Waktu penelitian :	-
	C.  Subyek penelitian :	22 non-financial companies listed on the Ghana Stock Exchange over a twelve year period from 2000.
5	Kerangkapikir :	H 1: There is an association between tax planning and firms’ market performance. It is unreasonable to suggest that tax planning is the only determinants of firm performance. Baring the existence of multicollinearity between (among) the explanatory variables, sales growth, financial leverage, firm size and age of the firms will be introduced into the regression models. Several studies, including Desai and Hines (2002), Desai and Dharmaphala (2007), Abdul-Wahab (2010) reported positive association between firm performance and sales growth, firm size and financial leverage. It is thus clear to develop the null hypothesis that: H 2: Firm performance and sales growth and firm size are positively associated. Firms’ age, according to Desai and Dharmapala (2007) and Abdul-Wahab (2010) has a negative association with market performance of firms. This gives rise to the third null hypothesis that:  H3: Firms age and financial leverage are negatively associated with firms’ market performance.
6	Metodologi penelitian
	A. Jenis/ pendekatan :	Quantitative study
	B. Metode sampling :	cross sectional designs
	C. Metode pengumpulan data	Collected from the Database of the Ghana Stock Exchange
	D. Metode analisis data :	Data analysis and ordinary least square (OLS)
7	Teori yang digunakan :	·      According to Hoffman (1961) tax planning seeks to divert cash, which would ordinarily flow to tax authorities, to the corporate entities. ·      Hoffman (1961) also recognised the role of tax cost in the tax planning activities. The theory thus provided that the positive association between tax planning and corporate performance is on a basic assumption that tax benefits from the tax planning exceed tax cost. The scope of the Hoffman’s tax planning theory does not address the dynamics of tax planning and market performance. ·      As capital markets develop and the separation of ownership and control of corporate bodies become well-spread, the need for a comprehensive tax planning theory is imperative. This need is rather addressed through the empirical perspectiv e than through theoretical perspective (Inger, 2012).
8	Hasil/temuan penelitian :	·      This finding confirms the observation of business persons in Ghana that business climate in Ghana gives unmatched advantage to the mining sector . The service sector records the lowe st market performance. This raises a major concern as the sector is the major contributor to gross domestic product (GDP) in Ghana. Another sector to watch out for is the oil and gas. This sector has the most recent history. It was expected that the high hopes of investors in the sector after the discovery of oil in commercial quantities in Ghana would have positive influence on the performance. It is expected that the sector will  be one of the major drivers of firms’ market performance in the future. ·      The correlation results do not suggest causation but gives an indication of association between the variables. The “no relationship” finding between tax planning and firms’ market performance supports the reports of Desai and Dharmapala (2007) but differ from the findings of Desai and Hines (2002) and Abdul-Wahab (2010). The findings suggest that although savings from tax planning reflect in higher profit after tax, it does not necessarily reflect in the pocket of shareholders. This finding ignites studies aimed at uncovering factors that mediate the tax planning-firm performance relationship. Indeed, it might be the reasons behind the works of Desai and Dharmapala (2007), Desai and Dharmapala (2009) and Abdul Wahab (2010). ·      The regression results found a relationship that is largely  consistent with the correlation results shown in table 3. The results affirm that tax planning plays an insignificant role in the determination of firms’ market performance. Again this supports the agency theory’s argument that it not all actions of management that help achieve the wealth maximisation objective of management. From the results sales growth and the financial leverage are the two most influential variables. Firms should maintain low financial leverage ratio and pursue sales growth strategies in order to boost their market performance
9	Diskusi :	·      Firstly firms’ tax savings decrease as tax authorities reduce the statutory corporate income tax rates. This indicates that leakages in tax revenue as a result of intensive tax planning of firms reduce when tax authorities maintain low corporate income tax rates ·      Secondly, tax planning has a neutral influence on firms’ performance. This finding challenges the general perception that every cedi of tax savings from tax planning reflect in the pocket of investors. Agency problem is much present in the issue of tax planning. The efforts of management to reduce tax burden of firms benefit other stakeholders rather than shareholders. ·      Finally, sales growth, firm size, age of firms, financial leverage and tax planning simultaneously play a major role in determining firms’ market performance. These vari ables explain 55.3% of the variations in firms’ market performance. Sales growth and financial leverage are th e two most influential variables that determine firm market performance
10	Saran  & rekomendasi
	A. Saran :
	B. Rekomendasi :