AC2101 S1 2014 Seminar 13 & 14 Deferred Tax (Anil).pptx

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Unformatted text preview: Cr Underlying account 20 10 Illustrating the 1st and 2nd Principles Seminar Outline: *  Illustration 1 (Asset: PPE capital allowance, Liability: Accrued expense & warranty provision) *  Illustration 2 (Asset: HFT securities) *  Dr Deferred Tax Expense (P&L) *  Illustration 3 (Asset: AFS securities) *  Dr AFS Reserve (OCI) 21 Application of FRS 12 -   Discuss Seminar Question 2 22 11 Recall from Step 2 *  Step 2: Uses information in the balance sheet [and other sources, if applicable] to determine temporary differences to compute the deferred tax liability/asset 23 Main Sources of TD *  Balance sheet items (Illustrations 1- 3) 24 12 Examples of TD Arising from B/S Items B/S account Cause of TD CA vs. TB Type of TD PPE (Asset – Illustration 1) Accelerated capital allowance CA > TB Taxable à༎ DTL Warranty provision (Liability – Illustration 1) Warranty expense CA > TB Deductible à༎ DTA Investment (Asset – Illustrations 2&3) Unrealized MTM gains CA > TB Taxable à༎ DTL Revenue in advance (Liability-...
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