Income Taxes IAS 12 - Wiley Home所得稅的國際會計(jì)準(zhǔn)則12號-威利家

1、Wiecek and YoungIFRS PrimerChapter 23Income Taxes:IAS 122Income TaxeslRelated standardslIAS 12lCurrent GAAP comparisonslIFRS financial statement disclosureslLooking aheadlEnd-of-chapter practiceRelated StandardslFAS 109 Accounting for income taxes3Related StandardslIAS 1 Presentation of financial st

2、atementslIAS 8 Accounting policies, changes in accounting estimates and errorslIAS 37 Provisions, contingent liabilities and contingent assetslIFRS 3 Business combinations4IAS 12 OverviewlObjective and scopelRecognition of current tax liabilities and assetslRecognition of deferred tax liabilities an

3、d assetslMeasurementlRecognition of current and deferred taxlPresentationlDisclosures5IAS 12 Objective and ScopelIAS 12 addresses the accounting issues related to tax effects ofCurrent period transactions and eventsUnused tax losses or creditsTax consequences when carrying amounts and tax amounts di

4、ffer6IAS 12 Recognition of Current Tax Liabilities and AssetslCurrent tax = amount of income taxes payable or recoverable on the taxable profit or loss for the periodlIf current taxes payable taxes paid, thenIncome taxes payablelIf current income taxes payable taxes paid, thenIncome taxes recoverabl

5、e/receivable7IAS 12 Recognition of Deferred Tax Liabilities and AssetslUnderlying assumption of accounting model:Assets will be recovered for at least their carrying amountLiabilities will be settled for their carrying amount l If there are tax consequences when the asset is recovered or liability s

6、ettled, this effect should be reported on the statement of financial position nowl Future tax effect = deferred tax liability or deferred tax asset8IAS 12 Recognition of Deferred Tax Liabilities and AssetsQ. Why a tax consequence?A. Because carrying amount of A & L may differ from their tax amount o

7、r tax base = a temporary difference Taxable temporary difference:Taxable income is increased in future when asset recovered/liability settledDeductible temporary difference:Taxable income is decreased in future when asset recovered/liability settled9IAS 12 Recognition of Deferred Tax Liabilities and

8、 Assets10IAS 12 Recognition of Deferred Tax Liabilities and AssetslExample: Installment A/R carrying amount - $40; revenues recognized on sale; taxable when cash received. Tax base = $0l Why is tax base $0?When the $40 is received (assets carrying amount is recovered), it is all taxable. No amount (

9、$0) is deductible from the $40 received.lTaxable temporary difference = $40 - $0 = $4011IAS 12 Recognition of Deferred Tax Liabilities and Assets12IAS 12 Recognition of Deferred Tax Liabilities and AssetslExample: Warranty liability carrying amount - $90; deductible for tax only when warranty expend

10、itures are made. Tax base = $0l Why is tax base $0?When the obligation is settled, the full $90 is deductible in calculating taxable income. Tax base is carrying amount of $90 less amount deductible in future of $90 = $0lDeductible temporary difference = $90 - $0 = $9013IAS 12 Recognition of Deferre

11、d Tax Liabilities and AssetslFuture tax consequence (assume tax rate of 40%):Taxable temporary difference tax rate* = deferred tax liabilityInstallment A/R temporary difference of $40 40% = $16 deferred tax liabilityl* tax rate statutory rate when temporary difference is expected to reverse, i.e., e

12、nter into calculation of taxable income14IAS 12 Recognition of Deferred Tax Liabilities and AssetslFuture tax consequence (assume tax rate of 40%):Deductible temporary difference tax rate* = deferred tax assetWarranty liability temporary difference of $90 40% = $36 deferred tax assetl * tax rate sta

13、tutory rate when temporary difference is expected to reverse, i.e., enter into calculation of taxable income15IAS 12 Recognition of Deferred Tax Liabilities and AssetslDeferred tax assetsResult from deductible temporary differences and unused tax losses/creditsRely on having taxable income in the fu

14、ture in order to benefitRecognize deferred tax asset only if probable that taxable profit will be available16IAS 12 Recognition of Deferred Tax Liabilities and AssetslProbable that taxable income will be available in future? Consider:Existence of taxable temporary differences that will reverse in fu

15、ture resulting in taxable incomeHistory of profitabilityTax planning opportunities lIf so, recognize deferred tax asset and benefit in same year as tax loss; recognize full tax effect on temporary deductible differences. Reassess each B/S date.17IAS 12 Recognition of Deferred Tax Liabilities and Ass

16、etslComplexities arise with differences between carrying amounts and tax base ofGoodwillA & L in a business combinationInvestments in subsidiaries, associates, joint ventures18IAS 12 MeasurementlCurrent tax liabilityTaxable income current tax rate = current tax payablel Current tax asset if past tax

17、es can be recoupedTaxable loss tax rate of past year = current tax receivable/recoverablelCurrent tax asset if current years taxes overpaid = current tax receivable/recoverable19IAS 12 MeasurementlDeferred tax assets and liabilitiesMeasured on an undiscounted basisUse tax rates for period when asset

18、 is expected to be recovered or liability settledUse rates based on laws enacted or substantively enacted at B/S dateUse average rates expected to apply to taxable profit/loss in period of expected reversal of temporary differenceReview carrying amount of deferred tax assets at each reporting date20

19、IAS 12 Recognition of Current and Deferred TaxlRecognize current and deferred taxes in profit or loss unlessThe related income or expense is recognized elsewhere such as OCI or directly in other equity itemTax results from a business combination21IAS 12 Presentationl Classification - deferred taxes

20、are non-current A/L (IAS 1)lOffsetting - both for current and deferred: only if same taxation authority, legal right to offset, intent is to settle net or at same timelTax expense includes both current and deferred taxeslReport tax expense on profit or loss separately from tax expense in OCI22IAS 12

21、 DisclosureslReport separately the major components of tax expense or incomeCurrent tax expense/incomeAdjustments for current tax of other periodsDeferred tax expense/income from each type of temporary difference or change in tax rates or new taxesBenefits recognized currently from previously unreco

22、gnized tax losses/credits, or other temporary differences23IAS 12 Disclosuresl Report (continued)Tax expense recognized directly in equity and in each component of OCIReconciliation of expected tax rate to effective tax rateTax expense for discontinued opns separately for operating results and other

23、 gain or loss24IAS 12 Disclosuresl Related to statement of financial position:lAmount of deferred tax asset/liability for each type of temporary differencelDeductible temporary differences and other balances with unrecognized deferred tax assetslNature of evidence supporting recognition of uncertain

24、 deferred tax assets25Current GAAP Comparisons Pages 29 to 30 of 49 ofhttp:/ Pages 94 to 98 of 164ofhttp:/www.kpmg.co.uk/pubs/IFRScomparedtoU.S.GAAPAnOverview(2008).pdf26IFRS Financial Statement Disclosures The Nestl Group http:/ Accounting policy for taxPage 16 of 118Income statement related disclo

25、suresPage 31 of 118Deferred tax assets and liabilitiesPage 55 of 11827Looking AheadlIncome taxes part of short-term convergence project with FASBlBoth IASB and FASB have agreed on many changes to eliminate exceptions to general principles in the standardslIASB issued an exposure draft in 2009 and ex

26、pects to issue final standard in 2010lExposure draft is for new draft IFRS, not amendments to IAS 1228Looking Aheadl Proposed changes likely in exposure draftTax base becomes a measurement attributeExisting non-recognition of deferred tax assets/liabilities in specific cases to be eliminatedClarific

27、ation of substantively enacted tax rateChange from non-recognition of deferred tax assets (when not probable of realization) to recognition with an associated valuation allowance accountProbable will be defined as more likely than not29Looking Aheadl Proposed changes (continued)Continuation of alloc

28、ating tax expense/income among P&L, OCI and equity, but subsequent changes will go through P&LBalance sheet classification of deferred taxes to mirror U.S. requirementsUncertain tax positions will be addressed using an expected outcome measure and changes recognized in continuing operationsDisclosur

29、es added; others removedReconciliation will be of parent company statutory rate to effective rate30End-of-Chapter Practice23-1 IAS 12 provides much more guidance on the recognition and measurement of the tax effects derived from deductible temporary differences than for the benefits from taxable tem

30、porary differences.Instructions Write a short paragraph to explain this situation.31End-of-Chapter Practice 23-2 Listed below are a number of situations that affect the financial statements.1.Development costs have been capitalized on the statement of financial position and are being amortized to pr

31、ofit or loss over three years, but deducted as an expense for tax purposes as incurred. 2.Revenue is recognized as goods are delivered for financial reporting purposes, but on a cash basis for tax purposes.3.An entity borrows money and pays a transaction fee on the amount borrowed. The transaction c

32、osts are added to the debt and amortized using the effective interest method for financial reporting purposes, although they were deducted when they were paid for tax purposes.4.Pension expense is charged to profit or loss each period although tax legislation allows entities to deduct only the contr

33、ibutions to the pension trustee to be deducted for tax purposes. Expenses have always exceeded the contributions.5.Investment property is measured according to the revaluation model for financial reporting purpose, resulting in valuations in excess of original cost. This method is not permitted for

34、tax purposes.InstructionsFor each situation described above, indicate whether the company has a deductible or a taxable temporary difference and whether it will result in the recognition of a deferred tax asset or a tax liability. Explain each briefly.32End-of-Chapter Practice23-3 A company buys equ

35、ipment for $1,000, uses it in the manufacturing of goods for resale, and depreciates it on a straight-line basis over its five-year expected useful life. For tax purposes, the equipment is depreciated at 25% a year on a straight-line basis. Tax losses may be carried back against taxable profit of th

36、e previous five years. The tax rate for all years is 40%, and in 2004 the companys taxable profit was $500. In each year from 2005 to 2009, the company reported profits before depreciation expense and taxes of $200. Instructionsa)For each year from 2005 to 2009, determine the companys taxable profit or loss and the current tax expense recognized.b)For each year from 2005 to 2009, determine the amount of any year-end taxable or deductible temporary difference and the related balance of the deferred tax asset or liability account reported on the balance sheet, and