Thursday 01 September 2016
The IFRS Interpretations Committee published the draft Interpretation to provide guidance when there is uncertainty over income tax treatments.
The Interpretations Committee was asked when the recognition of a current tax asset is appropriate if tax laws require an entity to make an immediate payment in respect of a disputed amount.
The Interpretations Committee noted that IAS 12 Income Taxes provides guidance on recognition in such a situation. However, it observed diversity in practice for various issues in circumstances in which there is uncertainty in the application of the tax law.
IAS 12 provides requirements on the recognition and measurement of current or deferred tax liabilities or assets, but does not provide specific guidance for how uncertainty about a tax treatment should be reflected in the accounting for income tax. Consequently, the Interpretations Committee proposes an Interpretation to propose that guidance.
The proposed draft Interpretation was published in October 2015. The comment period ended on 19 January 2016. A summary of the feedback received was presented to the Interpretations Committee in July 2016.
Feedback on draft Interpretation presented to the IFRS Interpretations Committee
The IFRS Interpretations Committee proposes two new interpretations
The IASB members confirmed that they are satisfied with the due process steps to date and therefore instructed the staff to begin the balloting process
[eIFRS Basic required]
© IFRS Foundation.