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Tax Effect Accounting - Implementation of AASB 112

Published on 06 Feb 2006 | Took place at Launceston Function Centre and Mercure Hotel Hobart, TAS

AASB 112 Income Taxes, introduces a conceptual change in the manner in which reporting entities account for income taxes. The conceptual change means that the old '4 column' approach to derive tax balances is no longer appropriate. Also, the financial statements of affected entities may be adversely affected. For instance, the new standard may require entities to recognise the tax impact of any unrealised gains booked in the financial statements. This is generally not required under the current standard. The new rules are applicable to financial reporting periods commencing on or after 1 January 2005.

These seminar materials will assist you in understanding:
- what the change in the conceptual approach means
- how to calculate tax balances under the new standard
- how to transition into the new standard
- what the key issues, traps and solutions are.

Individual sessions

Changes to accounting for income tax

Author(s):  Daren YEOH,  Ivan SHAPIRO

This paper covers:

  • why are the changes important?
  • who is most affected?
  • timeline
  • steps to implement AASB 112 for the first time
  • key changes
  • calculation of tax balances
  • comparing the old approach versus the new approach - what do you see?
  • tax base
  • recognition exceptions
  • revaluations
  • investments
  • business combinations
  • compound financial instruments
  • share-based payments
  • tax consolidation - UIG 1052.
Materials from this session: