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The purpose of the article/hypothesis: This paper aims to provide a comprehensive review of the theoretical and empirical literature regarding tax-induced earnings management. In particular, the association between anticipated tax changes and earnings management is of interest to the authors. Methodology: This paper uses a systematic literature review to achieve its research objectives. Results of the research: The presented research is mostly devoted to tax rate decreases and focuses on accrual-based earnings management methods. In anticipation of a tax rate change, companies shift their income from a high to a low tax rate period. Moreover, the probability of tax-induced earnings management is higher in case of extreme changes in the tax rate, larger prospects for tax savings as well as in case of private firms. This paper identifies several inconsistencies and gaps in the current literature, emphasizing that the connection between firms' characteristics, the level of book-tax conformity and the practice of earnings management remains unclear. [ABSTRACT FROM AUTHOR]

The main aim of the paper is to explore the intra‐industry effects of a bankruptcy filing on the capital market and to analyse the predomination of either competitive or contagion effect. The article is based on the assumption that the bankruptcy filing of the company affects the stock returns of its industry competitors and that the competitive effect dominates. The event study method is employed to assess the effect on the valuation of announcing and non‐announcing firms. The empirical study is conducted on the example of stock‐listed companies in Poland, where bankruptcy proceedings are not aimed at preserving the firm in distress. Averaged results suggest that the bankruptcy filing has a positive short‐term effect on the valuation of industry competitors in the sample, which indicates the competitive effect. However, looking at results broken down by industries there is no robust evidence of the effect. Only one sector experiences short‐lived positive investors' reaction. [ABSTRACT FROM AUTHOR]