PAS 12 - INCOMETAXES PAS 1 (January 1, 2005) 1...

Info iconThis preview shows pages 1–9. Sign up to view the full content.

View Full Document Right Arrow Icon
1 INCOME TAXES PAS 1 (January 1, 2005)
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 Preface to PAS 12 PAS 12 proper (with some examples) Appendix A – examples of temporary  differences Appendix B – illustrative computations  and presentation – indicates 5  examples
Background image of page 2
3 Objective prescribe the accounting treatment for  income taxes, particularly on how to account  for the current and future tax consequences  of     - the future recovery (settlement) of the  carrying amount of assets (liabilities) that are  recognized in the balance sheet     - transactions and other events of the  current period that are recognized in an  entity’s financial statements
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 Scope Applies to all enterprises that are subject to  income taxes. Income taxes include all domestic and foreign  taxes based on taxable profits, and witholding  taxes which are payable by subsidiary, associate  or joint venture on distributions to the reporting  entity Does not deal with methods of accounting for  government grants or investment tax credits  (covered by PAS 20)  but PAS 12 covers for  temporary differences arising from such grants  or investment tax credits
Background image of page 4
5 Definitions Accounting profit   – is profit or loss for a period  before deducting tax expense Taxable profit (tax loss)   – is the profit (loss) for  a period, determined in accordance with the  rules established by the taxation authorities,  upon which income taxes are payable  (recoverable)
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6 Definitions Temporary difference -  a difference between the  carrying amount of an asset or liability and its tax  base     -  taxable temporary difference  - a temporary  difference that will result in taxable amounts in the  future when the carrying amount of the asset is  recovered or the liability is settled.     - deductible temporary difference  - a temporary  difference that will result in amounts that are tax  deductible in the future when the carrying amount  of the asset is recovered or the liability is settled. 
Background image of page 6
7 Temporary differences Taxable temporary differences In the period of origin accounting profit >  taxable profit Revenues that are recognized in accounting profit before  they are recognized in taxable profit  revenues earned under the accrual basis in excess of  revenues earned under the cash basis Expenses and losses that are recognized in accounting  profit after they are recognized in taxable profit tax depreciation in excess of book depreciation expenses recognized under the cash basis for tax  purposes in excess of expenses recognized under the  accrual basis for accounting purposes)
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
8 Temporary differences
Background image of page 8
Image of page 9
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 11/30/2011 for the course ECON 310 taught by Professor Johnsmith during the Spring '11 term at Kentucky.

Page1 / 24

PAS 12 - INCOMETAXES PAS 1 (January 1, 2005) 1...

This preview shows document pages 1 - 9. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online