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

Taxable in future period frs128 13 illustration 1

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Unformatted text preview: me Cr Current Tax Payable/Receivable 11 Illustration 1 - Terminology *  CASE OF ENTITY BB: *  Step 2: Uses information in the balance sheet [and other sources, if appliable] to determine temporary differences to compute the deferred tax liability/asset. As defined in the earlier seminar, temporary difference (“TD”) of an asset/liability is the difference between the carrying amount of an asset or liability in the statement of financial position and its tax base, i.e. CA- TB. *  Carrying amount (CA): Amount attributed to an asset or liability for accounting purposes (B/S) *  Tax base (TB): Amount attributed to an asset or liability for tax purposes (per tax B/S) (FRS12:5) 12 6 Illustration 1 - Terminology *  TB of an asset = amount that will be deductible for tax purposes against any taxable economic benefits that will flow to an entity when it recovers the CA of the asset (FRS12:7) *  If those economic benefits will not be taxable, TB of asset deemed equal to...
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This document was uploaded on 02/10/2014.

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