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On 31 March 2009, the International Accounting Standards Board (IASB) released an exposure draft containing proposals for a new standard on accounting for income taxes which will replace the existing IAS 12 Income Taxes. This represents a partial alignment of IFRS and US GAAP in a number of areas, however there will continue to be some rather significant differences. The IASB's proposal is open to public comment until 31 July 2009, and the FASB will also take the proposal into account when deciding whether and how to proceed with eliminating the remaining differences between FAS 109 and IFRS.
The changes proposed by the exposure draft would have a significant impact on any companies who are currently preparing their financial statements under IFRS or the equivalent thereof. The proposals would likely result in greater complexity in the income tax provision calculations, and may also require changes in companies' systems and procedures to enable the new requirements to be met.
We will be issuing further comment on different aspects of the exposure draft to help companies access the impact of the proposals on them. In the meantime, a "Dataline" article has been issued by PricewaterhouseCoopers US provides a brief background of the exposure draft, summarises its key provisions and the continuing differences with US GAAP, and shares some of PricewaterhouseCoopers' insights on how the proposed changes would affect companies.
Get your copy here
Read more by downloading our Income tax accounting under IFRS - A look ahead: New exposure draft proposes significant changes for income tax accounting (pdf file, 71KB) for your reference.
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