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ifrs_tax_accounting_methods_0209

ifrs_tax_accounting_methods_0209 - IFRS What you need to...

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IFRS, US GAAP, and US tax accounting methods* Comparing IFRS & US GAAP and assessing the potential implications on US tax accounting methods February 2009 IFRS: What you need to know
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The heart of the matter 02 How will changes in accounting policy resulting from a conversion to IFRS affect tax accounting methods? An in-depth discussion 04 Will changes in accounting policy required upon the conversion to IFRS necessitate US tax accounting method changes? US tax accounting method considerations 05 US tax accounting method change procedures 07 A closer look 08 IFRS, US GAAP, and US tax accounting methods—a detailed comparative assessment February 2009 Table of contents
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IFRS, US GAAP, and US tax accounting methods 02 The heart of the matter How will changes in accounting policy resulting from a conversion to IFRS affect tax accounting methods?
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The heart of the matter 03 PricewaterhouseCoopers Converting to International Financial Reporting Standards (IFRS) will be a significant undertaking for many companies and could result in the adoption of several new accounting policies in the United States and in each foreign jurisdiction in which the organization operates. Assessing the tax implications of each of these newly adopted accounting policies will also be a labor intensive effort and will require a deep under- standing of the differences between a jurisdiction’s local GAAP and IFRS, as well as its local tax laws. As part of this assessment, companies will need to consider whether each new accounting policy change necessitates a tax accounting method change or, alternatively, creates an opportunity for a tax accounting method change that is strategic in light of the organization’s overall tax planning objectives. PricewaterhouseCoopers (PwC) has developed this IFRS publication, which compares the current US GAAP and IFRS treatment of several key pretax issues to help companies: Determine whether tax accounting method changes will be required or desired in the United States with respect to the computation of taxable income for domestic companies and of earnings and profits (E&P) for foreign subsidiaries. Assess the impact of each new accounting policy change on the computation of book-tax differences (also known in the United States as “Schedule M” adjustments) and E&P computations. This document serves as a companion piece to the following PwC IFRS publications: IFRS and US GAAP, similarities and differences , which provides a more comprehensive overview and analysis of the significant pretax accounting similarities and differences between IFRS and US GAAP and Implications of IFRS Conversion on US Tax Accounting Methods , which provides an in-depth discussion of the potentially significant cash tax and tax compliance implications that conversion to IFRS may have on key US tax accounting method issues.
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