RECEIVABLES AND TAX PAYABLE IN MANUFACTURING COMPANIES: PANEL ANALYSIS REACTIONS

Articles in Press

Document Type : Review article

Author

• Tajudeen Adejare ADEGBITE

Department of Accounting, AL-HIKMAH UNIVERSITY, ILORIN

10.22067/ijaaf.2024.88155.1464

Abstract

ABSTRACTThis study examined the effect of receivable on tax payable in listed Nigeria manufacturing companies. Data collected from annual publication of selected thirty-four (34) Nigeria manufacturing companies between 2011 and 2023 were analysed with analytical tools such as pooled regression, fixed effects and random effects as well as Hausman test. The heteroskedasticity and VIF were also employed to determine the multicollinearity in the variables employed. Pearson Product Moment correlation (PPMC) was also involved to determine the relationship among the variables. It was noted from results attained from the analysis that there is a positive effect of receivables on tax payable. It was invariably discovered that PBT, taxable income and revenue had positive influence on tax payable but total asset negative and audit committee quality displayed negative effect on tax payable due to the fact that one percent increment in total assets and audit committee quality absolutely bring down tax payable. Conclusively, receivable has positive significant effect on tax payable in Nigeria manufacturing companies. It is recommended that receivable monitoring mechanisms or devices should be put in place by the government to monitor all the receivables of the organization in order to prevent artificial dwindling in tax payable and to enhance transparency in financial reporting of manufacturing companies which will contribute to a more accurate and standardized assessment of tax implications.

Keywords

• Receivable
• Total Asset
• Audit Committee Quality
• Taxable income
• Tax payable

Main Subjects

• Accounting

---