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Sunday 9 October 2011

BMS ssf -DTA & DTL

(i) An enterprise should offset deferred tax assets and deferred tax liabilities if:
(a) the enterprise has a legally enforceable right to set off assets against liabilities
representing current tax, and
(b) the deferred tax assets and the deferred tax liabilities relate to taxes on
income levied by the same governing taxation laws.
(ii) Deferred tax assets and liabilities should be distinguished from assets and liabilities
representing current tax for the period. Deferred tax assets and liabilities should be
disclosed under a separate heading in the balance sheet of the enterprise,
separately from current assets and current liabilities.
(iii) The break-up of deferred tax assets and deferred tax liabilities into major
components of the respective balances should be disclosed in the notes to
accounts.
(iv) The nature of the evidence supporting the recognition of deferred tax assets should
be disclosed, if an enterprise has unabsorbed depreciation or carry forward of
losses under tax laws.

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