Recognition of Deferred Tax Assets for Unrealized Losses (Amend IAS 12)

BACKGROUND

The Accounting Standards Board (AcSB) is participating in the International Accounting Standards Board’s (IASB) project to amend International Accounting Standard (IAS) 12 Income Taxes.

The objective of this project is to clarify the accounting for deferred tax assets for unrealized losses on debt instruments measured at fair value.

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The AcSB’s due process includes ensuring that Canadian entities’ financial reporting needs are considered by the IASB and issuing the AcSB’s own exposure draft on each IASB proposal.  Subject to the responses to the AcSB’s exposure draft on whether the IASB’s proposals are appropriate for application in Canada, the AcSB expects that the amendments will be incorporated into Canadian GAAP in accordance with the AcSB’s strategy of adopting IFRSs for publicly accountable enterprises.

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PROJECT NEWS

Final Amendments – Recognition of Deferred Tax Assets for Unrealised Losses (Amendments to IAS 12)
January 22, 2016.  The IASB has issued narrow-scope amendments to IAS 12 Income Taxes to clarify how to account for deferred tax assets related to debt instruments measured at fair value. The amendments are effective for annual periods beginning on or after January 1, 2017 with earlier application permitted.

AcSB Response – Recognition of Deferred Tax Assets for Unrealized Losses (Proposed amendments to IAS 12)
On December 18, 2014, the AcSB submitted a comment letter responding to the IASB’s Exposure Draft issued in August 2014.  The letter expresses support for the proposed amendments set out in the Exposure Draft.   The letter also suggests that the proposed illustrative example focus on the key aspects of the amendments, thereby reducing its length and complexity.  Read the AcSB letter posted by the IASB.

AcSB Exposure Draft – Recognition of Deferred Tax Assets for Unrealized Losses (Proposed amendments to IAS 12)
October 3, 2014. The AcSB has issued an Exposure Draft that corresponds to the IASB’s Exposure Draft on this topic. Canadian stakeholders are encouraged to submit their comments, on the form provided, by December 18, 2014.

IASB Exposure Draft – Recognition of Deferred Tax Assets for Unrealised Losses (Proposed amendments to IAS 12)
August 21, 2014. The IASB has issued an Exposure Draft proposing amendments to IAS 12 Income Taxes to clarify how to account for deferred tax assets related to debt instruments measured at fair value. Canadian stakeholders are encouraged to submit their comments to the IASB by December 18, 2014.

 

Disclaimer: This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal ballot process.