RSM321H1 Chapter Notes - Chapter 9: Historical Cost, Debits And Credits, Pipeline Transport
Document Summary
Ias 12 uses the balance sheet (liability) approach when dealing with deferred taxes. I. e. for unearned revenue it would be cv revenue that will not be taxable in the future. Two types of temporary differences: deductible one that can be deducted in determining ti in the future when the asset/liability is recovered or settled for its cv. Exist when cv of an asset < its tax base, or amount related to a liability can be deducted for tax purposes. These result in deferred income tax assets: taxable one that will result in future taxable amounts when the cv of the asset/liability is recovered/settled. Occur mainly when the cv of an asset > tax base. These result in deferred income tax liabilities. When cumulative cca taken on an asset > a/d for the asset, the result is a deferred tax liability.
