Accountant CFOs and corporate tax avoidance

This paper examines the association between Chief Financial Officers (CFOs) with accounting expertise (i.e., Accountant CFOs) and corporate tax avoidance. Specifically, I attempt to explore the impact of specialized accounting knoWledge of CFOs on general and aggressive tax avoidance strategies. Consistent with my conjectures, I find that having accounting competence among CFOs is positively associated with their general tax avoidance behavior, suggesting that CFOs take advantage of their professional knowledge to reduce corporate tax payment to related tax authorities. In addition, the empirical evidence that I found also shows that accountant CFOs are less likely to involve in aggressive tax avoidance strategies. This conclusion is consistent with prior studies arguing that accountant CFOs are risk averse and conservative. In summary, accountant CFOs have quite different attitudes towards various tax avoidance activities depending on the underlying tax position of the tax planning behavior.