Page 99 - CITN 2017 Journal

Effects Specification
Cross-section fixed (first differences)

Mean dependent
-0.011222 S.D. dependent var 9.112949
var
S.E. of regression 5.322012 Sum squared resid 12490.80
J-statistic 34.32538 Instrument rank 45
Prob(J-statistic) 0.548362

Wald chi2(8) 44.58644 (0.0000)

TEST ORDER M.Statistic Rho SE(rho) Prob.
AR(1) -3.439 -2833.15 823.62 0.0006
AR(2) -1.161 -965.99 831.82 0.2455

***, * mean significant at 1% and 10% respectively
Source: Author's Computation, 2015
As observed by Kawor and Kportorgbi (2014), it is unreasonable to suggest that tax
planning is the only determinants of firm performance likewise the firm value, other
variables such as leverage (LEV), Liquidity (LIQ), Net Working Capital (NWC), Growth
opportunities (MTB) capital intensity (CIN) profitability and size were introduced into the
model specification. All the variables such as leverage (LEV), Liquidity (LIQ), Net
Working Capital (NWC), Growth opportunities (MTB) capital intensity (CIN) are found to
have a positive and significant relationship with the firm value except the profitability and
size that shows a negative but significant relationship. These variables play a major role in
determining firms' value.

Conversely and contrary to apriori expectation, there is a significant negative relationship
between profitability and the value of non-financial quoted companies in Nigeria. This
implies that an increasing proportion of profitability is associated with decrease in firm
value. Agency problem is much present in this issue of profitability. The efforts of
management to increase profit benefit other stakeholders rather than shareholders, as this
may not reflect in the firm value. Similarly, there is a significant negative relationship
between SIZE and firm value (t=-3.340150, p< 0.01). This finding is in variance with Rego
(2003) finding of a positive relationship between firm size and firm value, he stressed that
larger firms can achieve economies of scale via tax planning and have the resources and
incentives to decrease group tax. Since, the relationship between size and firm value is
ambiguous, the result is within the theoretical prediction.The F- statistics value of
44.58644 (P<0.01) shows that all the variables in the model are jointly statistically
significant in explaining variations in value of non-financial quoted companies.

1. CONCLUSION AND RECOMMENDATION

The study analysed the effects of corporate tax planning on the value of non-financial
quoted companies in Nigeria. A panel data of financial characteristic of 50 non-financial
quoted firms spreading over ten sectors were collected from the annual financial statement
of the firms over the period of 2004 to 2014 from the Nigerian Stock Exchange fact books.
The coefficient of lagged dependent variable (TOBINQ) is positive and significantly
different from zero at 1%. This suggests that current firm value is positively influenced by
firm value in the previous year. The adjustment coefficient is about 0.880044, which

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