Prudence Accounting, Financial Distress, and Foreign Operations on Tax Avoidance: Leverage’s Moderating Role

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This study shows tax avoidance influenced by prudence accounting and financial distress in Indonesia, suggesting leverage weakens these effects.

Prudence accounting and financial distress significantly increase tax avoidance, while foreign operations have no notable effect.
Leverage weakens the positive relationship between prudence accounting and tax avoidance by moderating their interaction.
Panel data regression analysis was utilized on secondary data from audited financial statements of firms listed on IDX.
Findings highlight the intricate dynamics of tax strategies within Indonesia's tightly regulated financial sector.

Raainaa et al. (2025) studied this question.

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This study shows tax avoidance influenced by prudence accounting and financial distress in Indonesia, suggesting leverage weakens these effects.