Accounting Financial Standards Board
ORIGINAL PRONOUNCEMENTS
AS AMENDED
Statement of Financial Accounting Standards No. 109
Accounting for Income Taxes
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Statement of Financial Accounting Standards No. 109 Accounting for Income Taxes
STATUS
Issued: February 1992 Effective Date: For fiscal years beginning after December 15, 1992 Affects: Amends ARB 43, Chapter 9C, paragraph 5 Replaces ARB 43, Chapter 9C, paragraphs 11 through 13 Deletes ARB 43, Chapter 10B and Chapter 11B, paragraph 8 Deletes ARB 44, (Revised), related letter dated April 15, 1959 Supersedes ARB 44 (Revised) Reinstates ARB 51, paragraph 17 Supersedes APB 1 Replaces APB 2, paragraph 16 Deletes APB 6, paragraphs 20 through 23 and footnotes 7 and 8 Supersedes APB 11 Amends APB 16, paragraphs 87 and 88 Deletes APB 16, paragraph 89 Amends APB 17, paragraph 30 Amends APB 21, footnote 8* Amends APB 23, paragraphs 9, 13,* 21, and 23 and footnotes 7* and 9 Replaces APB 23, paragraphs 10, 11, 14, and 24 Deletes APB 23, footnotes 3, 4, 6, and 10 Supersedes APB 24 Amends APB 25, paragraph 17 Amends APB 28, paragraphs 19* and 20 and footnotes 2 and 3 Amends APB 29, paragraph 27* Amends APB 30, paragraph 7 Deletes AIN-APB 4, Interpretations No. 4 and 6 Supersedes AIN-APB 11, Interpretations No. 1 through 25 Deletes AIN-APB 15, Interpretations No. 13 and 16 Amends AIN-APB 18, Interpretations No. 1 and 2* Supersedes AIN-APB 23, Interpretation No. 1 Amends AIN-APB 25, Interpretation No. 1 Amends FAS 12, paragraph 22* Amends FAS 13, paragraph 47 Replaces FAS 16, paragraph 11 Amends FAS 16, paragraph 13 and footnotes 3 and 4 Deletes FAS 16, footnote 5 Amends FAS 19, paragraphs 59U, 59Y(c), 61, and 62 Supersedes FAS 31 Replaces FAS 37, paragraph 4 and footnote (*) of paragraph 4 Deletes FAS 37, paragraphs 17, 18, and 26 through 29 and footnotes 1 through 3 and footnote () of paragraph 4 Amends FAS 37, paragraphs 19,* 20, 21,* 22,* 23, 24,* and 25*
*
Result of the amendment, at least in part, described in paragraph 287.
FAS1091
Amends FAS 38, paragraphs 2 and 5 Replaces FAS 38, footnote 2 Amends FAS 44, paragraph 6* Amends FAS 52, paragraphs 22,* 23,* 24,* and 48 Amends FAS 57, paragraph 2 Replaces FAS 60, paragraphs 55 and 60(i) Deletes FAS 60, paragraphs 56 through 58 and 60(j) and footnote 8 Amends FAS 60, paragraph 59 Amends FAS 69, paragraphs 26, 30(c), 40, and 41 Replaces FAS 71, paragraph 18 Amends FAS 71, paragraph 46 Deletes FAS 71, footnote 12 Amends FAS 87, paragraph 37* Amends FAS 89, paragraphs 33* and 96 Amends FAS 90, paragraphs 14 and 27* Supersedes FAS 96 Supersedes FAS 100 Amends FAS 101, paragraph 19* Supersedes FAS 103 Supersedes FAS 108 Amends FIN 18, paragraphs 6,* 8, 16, 18, 40 through 43, 46 through 55, 58, 65, 66, and 68 and footnotes 2,* 19, and footnote (*) of paragraph 47 Replaces FIN 18, paragraphs 14, 15, 20, and 23 Deletes FIN 18, paragraphs 59 through 61 and 70 and footnotes 9 through 14, 18, 21 through 23, and 25 Supersedes FIN 22 Supersedes FIN 25 Supersedes FIN 29 Amends FIN 30, paragraph 5* Amends FIN 31, footnote 1 Supersedes FIN 32 Amends FTB 79-9, paragraph 3 Amends FTB 79-16 (Revised), paragraph 4 Supersedes FTB 81-2 Replaces FTB 82-1, paragraph 5 Amends FTB 82-1, paragraph 7* Supersedes FTB 83-1 Supersedes FTB 84-2 Supersedes FTB 84-3 Supersedes FTB 86-1 Deletes FTB 87-2, paragraphs 9 through 11, 13, and 22 through 33 and footnotes 4 and 8 Amends FTB 87-2, paragraphs 14,* 18,* 34,* 35,* 36,* 40,* 45,* and 46* Amends FTB 88-2, paragraph 4* Affected by: Paragraph 8(a) replaced by FIN 48, paragraph C3(a) Paragraphs 9(d), 16, 26, 37, 45(f), 45(h), 48, 250 through 262, 264, 265(e), and 266 and footnotes 9a and 18a amended by FAS 141(R), paragraphs E22(a), E22(c), E22(d), E22(h), E22(i), E22(j), E22(k), E22(m), E22(n), E22(o), E22(q), E22(r), E22(s), E22(g), and E22(a), respectively Paragraph 10 amended by FIN 48, paragraph C3(b)
*Result of the amendment, at least in part, described in paragraph 287.
FAS1092
Paragraphs 11(h), 30, and 259 amended by FAS 141, paragraphs E15(a) and E15(b), E15(d), and E15(f), respectively, and FAS 141(R), paragraphs E22(b), E22(e), and E22(l), respectively Paragraph 13 amended by FAS 141, paragraph E15(c), and FAS141(R), paragraph E42 Paragraph 30A and footnote 8a added by FAS 141(R), paragraph E22(f) Paragraph 33 amended by FAS 160, paragraph C2 Paragraphs 35 and 36 amended by FAS 130, paragraph 32 Paragraph 36(b) amended by FAS 115, paragraph 133 Paragraphs 36(d) and 270 amended by FAS 141, paragraphs E15(e) and E15(g), respectively Paragraph 36(e) amended by FAS 123, paragraph 390, and FAS 123(R), paragraph D13 Paragraph 263 replaced by FAS 141(R), paragraph E22(p) Paragraphs 268 and 269 deleted by FAS 141(R), paragraph E22(t) Paragraph 276 amended by FAS 135, paragraph 4(s) Paragraph 289 amended by FIN 48, paragraph C3(c), and FSP FAS 126-1, paragraph A4 Other Interpretive Releases: FASB Special Report, A Guide to Implementation of Statement 109 on Accounting for Income Taxes: Questions and Answers (in Current Text Section I27) FASB Staff Positions FAS 109-1 and FAS 109-2 FASB Staff Positions FIN 48-1 and FIN 48-2 AICPAAccounting Standards Executive Committee (AcSEC) Related Pronouncements: SOP 76-3 SOP 93-6 SOP 94-6 PB 14 Issues Discussed by FASB Emerging Issues Task Force (EITF) Affects: Nullifies EITF Issues No. 84-43, 85-3, 85-15, 85-33, 86-1, 86-4, 86-37, 86-41, and 86-42 Partially nullifies EITF Issues No. 86-3 and 87-8 Resolves EITF Issues No. 84-1, 84-2, 84-27, 85-5, 86-11, 87-28, and 91-3 and Topic No. D-7 Partially resolves EITF Issues No. 85-41 and 88-5 Affects EITF Issues No. 86-31, 88-19, and 91-8 Interpreted by: Paragraph 9 interpreted by EITF Topic No. D-31 Paragraph 9(f) interpreted by EITF Issues No. 92-8 and 93-9 and Topic No. D-56 Paragraph 11 interpreted by EITF Issue No. 93-9 Paragraphs 15 and 31 interpreted by EITF Issue No. 93-16 Paragraph 17 interpreted by EITF Issue No. 94-1 and Topic No. D-31 Paragraph 18 interpreted by EITF Issue No. 95-10 Paragraph 19 interpreted by EITF Issue No. 95-20 Paragraph 26 interpreted by EITF Issue No. 94-10 Paragraph 27 interpreted by EITF Issues 93-12, No. 93-13, and 99-15 and Topic No. D-30 Paragraph 30 interpreted by EITF Issues No. 93-7 and 99-15 Paragraph 34 interpreted by EITF Issue No. 93-17 Paragraph 35 interpreted by EITF Issue No. 95-9 and Topic No. D-32 Paragraph 36 interpreted by EITF Issue No. 94-10 and Topic No. D-32 Paragraph 36(f) interpreted by EITF Issue No. 92-3 Paragraphs 37 and 38 interpreted by EITF Topic No. D-32 Paragraph 268 interpreted by EITF Topic No. D-33 Related Issues: EITF Issues No. 85-31, 86-9, 88-4, 96-7, 98-11, 00-15, 02-13, 05-8, and 06-11
FAS1093
SUMMARY
This Statement establishes financial accounting and reporting standards for the effects of income taxes that result from an enterprise's activities during the current and preceding years. It requires an asset and liability approach for financial accounting and reporting for income taxes. This Statement supersedes FASB Statement No. 96, Accounting for Income Taxes, and amends or supersedes other accounting pronouncements listed in Appendix D. Objectives of Accounting for Income Taxes The objectives of accounting for income taxes are to recognize (a) the amount of taxes payable or refundable for the current year and (b) deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an enterprise's financial statements or tax returns. Basic Principles of Accounting for Income Taxes The following basic principles are applied in accounting for income taxes at the date of the financial statements: a. A current tax liability or asset is recognized for the estimated taxes payable or refundable on tax returns for the current year. b. A deferred tax liability or asset is recognized for the estimated future tax effects attributable to temporary differences and carryforwards. c. The measurement of current and deferred tax liabilities and assets is based on provisions of the enacted tax law; the effects of future changes in tax laws or rates are not anticipated. d. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realized. Temporary Differences The tax consequences of most events recognized in the financial statements for a year are included in determining income taxes currently payable. However, tax laws often differ from the recognition and measurement requirements of financial accounting standards, and differences can arise between (a) the amount of taxable income and pretax financial income for a year and (b) the tax bases of assets or liabilities and their reported amounts in financial statements. APB Opinion No. 11, Accounting for Income Taxes, used the term timing differences for differences between the years in which transactions affect taxable income and the years in which they enter into the determination of pretax financial income. Timing differences create differences (sometimes accumulating over more than one year) between the tax basis of an asset or liability and its reported amount in financial statements. Other events such as business combinations may also create differences between the tax basis of an asset or liability and its reported amount in financial statements. All such differences collectively are referred to as temporary differences in this Statement. Deferred Tax Consequences of Temporary Differences Temporary differences ordinarily become taxable or deductible when the related asset is recovered or the related liability is settled. A deferred tax liability or asset represents the increase or decrease in taxes payable or refundable in future years as a result of temporary differences and carryforwards at the end of the current year.
FAS1094
Deferred Tax Liabilities Adeferred tax liability is recognized for temporary differences that will result in taxable amounts in future years. For example, a temporary ...