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Table 2 Sample selection

From: The detection of earnings management through a decrease of corporate income tax

  Netherlands Germany
Cash basis sample*   
List of cash basis companies from 2002–2017 9 96
Companies with missing lagged market value of equity and 8 7
Companies with DataStream in only 1999 or 2004 12 10
Companies with missing earnings data for either year 4 5
Companies not on DS or with missing returns for either year 6 4
Companies that have no matching accrual basis companies in the same 7 6
Total cash basis sample—number of companies 54 64
Number of company-years available for the sample of 54 Dutch companies and 64 German companies for the years 2002–2006 and 2007–2009 200 200
Accrual basis sample   
Company-years in the DataStream file matching four-digit industries as the cash sample with 2002 sales > $5 million, and observations in both years 2002 and 2004, for years 2000–2004 and 2006–2009 1350 1850
Company-years with missing earnings or return data 400 200
Less cash basis company observations 200 200
Total accrual basis sample—company-years (65 companies) 750 1450
Total sample cash and accrual company-year observations 950 1650
  1. Source: Author work
  2. *Cash basis sample includes the companies required to switch from the cash basis method of accounting for tax purposes to the accrual basis method following Guenther [25] and Moghadam et al. [26] provides evidence with companies deferring more financial accounting income as a result of the increase in book-tax conformity after this change