| All firms | Family firms (Family firm 3) | Non-family firms | Diff in Means | t-stat. | |||
| Mean | Std. Dev. | Mean | Std. Dev. | Mean | Std. Dev. | ||
BTD | −0.009 | 0.287 | 0.002 | 0.251 | −0.026 | 0.316 | 0.028 | 3.93** |
RBTDs | 0.005 | 0.091 | 0.007 | 0.093 | 0.002 | 0.087 | 0.005 | 2.34* |
DPDs (Discretionary Permanent Differences) | 0.013 | 0.321 | 0.019 | 0.329 | 0.004 | 0.318 | 0.015 | 1.94* |
Divergence | 0.854 | 0.376 | 0.876 | 0.314 | 0.819 | 0.398 | 0.057 | 6.25** |
PTROA | 0.015 | 0.089 | 0.016 | 0.093 | 0.013 | 0.082 | 0.003 | 1.21 |
NOL_D | 0.397 | 0.412 | 0.401 | 0.326 | 0.391 | 0.451 | 0.010 | 1.03 |
FOR_D | 0.401 | 0.375 | 0.414 | 0.328 | 0.381 | 0.431 | 0.033 | 3.44** |
DAP | −0.040 | 7.53 | 0.120 | 7.01 | −0.292 | 8.14 | 0.412 | 2.16* |
LEV | 0.853 | 1.853 | 0.784 | 0.846 | 0.961 | 1.961 | −0.177 | −4.44** |
MTB | 1.581 | 1.547 | 1.618 | 1.528 | 1.523 | 1.562 | 0.095 | 2.49** |
EM1 | 0.089 | 0.488 | 0.083 | 0.476 | 0.098 | 0.492 | −0.015 | −1.29 |
EM2 | 0.000 | 0.424 | 0.001 | 0.429 | −0.002 | 0.413 | 0.003 | 0.25 |
ΔPTCFO | 0.002 | 0.134 | 0.002 | 0.156 | 0.002 | 0.112 | 0.001 | 0.16 |
SIZE | 11651 | 25111 | 10945 | 24045 | 12761 | 29452 | −1815.84 | −2.68** |
Number of observations | 6.929 | 4235 (61.12%) | 2694 (38.88%) |
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BTDs | The book income less taxable income scaled by lagged total assets; | |||||||
RBTDs | The portion of book-tax gap not explained by earnings accruals, which was developed by | |||||||
DPDs | The discretionary permanent difference is the measure of tax sheltering developed by | |||||||
Famfirm3 | At least one member of the 2nd or later generation serves as an officer, a director or large shareholder | |||||||
PTROA | Pre-tax income at t year divided by total assets at year t − 1; | |||||||
NOL_D | 1 if the net operating loss carryforwards for firm i at year t − 1 are greater than 0; 0 otherwise; | |||||||
FOR_D | 1 if foreign income for firm i at year t is not equal to 0; 0 otherwise; | |||||||
DAP | The performance-adjusted discretionary accruals suggested by | |||||||
LEV | Total debt for firm i at year t, divided by total assets at year t; | |||||||
MTB | Market value of common equity for firm i at year t − 1, divided by book value of common equity for firm i at year t − 1; | |||||||
EM1 | 1 if net income in year t, divided by the market value of common equity at year t − 1, is greater than 0 and less than or equal to 0.01 for firm i, and 0 otherwise; | |||||||
EM2 | 1 if the change in net income from year t − 1 to year t, divided by the market value of common equity at year t − 2 is greater than 0 and less than or equal to 0.01 for firm i, and 0 otherwise; | |||||||
ΔPTCFO | Change in pre-tax cash flow from operations for firm i in year t, divided by total assets for firm i at year t − 1; and | |||||||
SIZE | The natural logarithm of total assets at book value for firm i at year t. |