IASB seeks comments on a proposed new standard on income tax accounting
31 March 2009
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The International Accounting Standards Board (IASB) today published for public comment an exposure draft of a proposed new standard on the accounting for income tax. If adopted, the standard would replace the existing requirements in IAS 12 Income Taxes.
The proposed standard retains the basic approach to accounting for income tax, known as the temporary difference approach. The objective of that approach is to recognise now the future tax consequences of past events and transactions, rather than waiting until the tax is payable. Although the proposed standard retains the same principle, the IASB proposes to remove most of the exceptions in IAS 12, to simplify the accounting and strengthen the principle in the standard. In addition, the IASB proposes a changed structure for the standard that will make it easier to use. |
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Introducing the exposure draft, Sir David Tweedie, Chairman of the IASB, said:
Income tax requirements differ considerably from jurisdiction to jurisdiction. The application of the existing requirements to these different circumstances can be difficult, resulting in complex and potentially diverse interpretations. Our aim is to achieve a clearer, more principle-based standard that will make the accounting requirements on income tax easier to understand and apply and will also result in more consistent reporting.
I also welcome and support the efforts of several national standard setters, in particular the UK Accounting Standards Board (ASB) and the German Accounting Standards Board (GASB), to undertake a fundamental review of income tax accounting.
The proposals are set out in the exposure draft Income Tax which is open for comment until 31 July 2009. The exposure draft is available on the ‘ Open for Comment ’ section on www.iasb.org . The IASB expects to hold a webcast soon to introduce the proposals in the exposure draft and details will be announced on the website in due course. A flow chart and illustrative examples to illustrate the proposals in the exposure draft have been prepared by the IASB’s staff and posted on the project page of the website.
Printed copies of the exposure draft (ISBN for the set 978-1-905590-97-1) will be available shortly, at £10.00 plus shipping, from:
IASC Foundation Publications Department,
30 Cannon Street, London EC4M 6XH, United Kingdom.
Tel: +44 (0)20 7332 2730 Fax +44 (0)20 7332 2749
Email: publications@iasb.org Web: www.iasb.org
Press enquiries
- Mark Byatt , Director of Corporate Communications, IASB
Telephone: +44 (0)20 7246 6472,
Email: mbyatt@iasb.org
- Sonja Horn , Communications Adviser, IASB
Telephone: +44 (0)20 7246 6463
Email: shorn@iasb.org
Technical inquiries:
- Anne McGeachin , Senior Project Manager, IASB
Telephone: +44(0)1225 426 517
Email: amcgeachin@iasb.org