Let's talk a little about the difference in tax and financialreporting and the impact IFRS could have. In the United States, inparticular, fair presentation under GAAP sets the standards forfinancial accounting. GAAP is adjusted, if you will, to comply withtax accounting. More specifically, taxable profits must be adjustedfrom GAAP presentation to tax accounting in order to facilitateaccurate tax reporting at year's end.
From an accounting perspective, do you think tax accounting andfinancial accounting should be uniform? I believe that is a hugeleap considering that countries themselves are separated in termsof how accounting systems developed legally. On the one hand, youhave micro-based, common law countries like the U.S., who haveadopted fair presentation standards. On the other hand, aremacro-based, code law countries whose accounting standards conformto tax legislation? I don't believe, under these separate set ofcircumstances, that uniformity will work internationally any morethan one would expect diverse systems of government and capitalmarkets to behave in one way. What are your thoughts?
Let's talk a little about the difference in tax and financialreporting and the impact IFRS could have. In the United States, inparticular, fair presentation under GAAP sets the standards forfinancial accounting. GAAP is adjusted, if you will, to comply withtax accounting. More specifically, taxable profits must be adjustedfrom GAAP presentation to tax accounting in order to facilitateaccurate tax reporting at year's end.
From an accounting perspective, do you think tax accounting andfinancial accounting should be uniform? I believe that is a hugeleap considering that countries themselves are separated in termsof how accounting systems developed legally. On the one hand, youhave micro-based, common law countries like the U.S., who haveadopted fair presentation standards. On the other hand, aremacro-based, code law countries whose accounting standards conformto tax legislation? I don't believe, under these separate set ofcircumstances, that uniformity will work internationally any morethan one would expect diverse systems of government and capitalmarkets to behave in one way. What are your thoughts?