Accounting Standards for Private Enterprise

Income Taxes

Summary

This project proposes to amend Section 3465 to remove an outdated example on “eligible capital expenditures”, and to remove the requirement to present future income tax assets and liabilities as current and non-current when the future income taxes method is applied.

Staff Contact(s)

Grace Lang, CPA, CA, CPA (Illinois)

Principal, Accounting Standards Board

Project Status

  • Information gathering

    Completed prior to March 2018

  • Approving project

    The AcSB approved the project in March 2018

  • Consulting stakeholders

    Exposure Draft issued September 7, 2018

    Public outreach is underway

    Comment letters are due by December 5, 2018

  • Deliberating feedback
  • Final pronouncement

Meeting & event summaries


June 19, 2018

AcSB Decision Summary – June 19, 2018

The Board considered the advice of its Private Enterprise Advisory Committee relating to the proposals, and decided:

  • to remove the example in Section 3465, which is no longer applicable given recent changes to the Income Tax Act (Canada); and
  • to require enterprises using the future income taxes method to present future income tax assets and liabilities as non-current and to disclose the amount of future income tax assets and liabilities.

The Board also considered a communication plan for the forthcoming exposure draft and decided on its outreach activities with stakeholders. The Board directed staff to begin the balloting process for the proposals and plans to issue an exposure draft in September 2018 with comments due in December 2018.

May 3, 2018

Private Enterprise Advisory Committee Notes – May 3, 2018

Future income tax
The Committee considered staff’s proposals on the following two amendments in Section 3465, Income Taxes:

  • Delete example (f) in paragraph 3465.14, which is no longer applicable given recent changes to the Income Tax Act (Canada).
  • Remove the requirement to segregate future tax assets and liabilities into current and non-current portions when the future tax method is applied.

The Committee noted that presenting all future taxes as non-current may affect the financial information reported in some situations. For example, future tax liabilities resulting from holdbacks in the construction industry, which typically unwind in 12-18 months, would no longer appear as current liabilities. The Committee advised the Board to consider supplementing the classification of future tax proposal with additional note-disclosure requirements.

March 20, 2018

AcSB Decision Summary – March 20-21, 2018

The Board also considered the Committee’s advice relating to issues raised by stakeholders through its outreach activities and decided:

  • to expose for public comment the proposals to delete as narrow-scope amendments:
    • the example in Section 3465, Income Taxes, that is no longer applicable given recent changes to the Income Tax Act (Canada) and
    • the requirement to segregate future tax assets and liabilities into current and non-current portions when the future tax method is applied.

News


October 23, 2018

News

Webinar – AcSB Domestic Standards Update

October 23, 2018. Are you a Canadian private enterprise or not-for-profit organization, an advisor to one, or a user of financial reports? Learn about upcoming and future changes to Part II and Part III of the CPA Canada Handbook. Tune in on October 30, 2018 (French) or October 31, 2018 (English).

September 7, 2018

News

AcSB Exposure Draft – Income Taxes

September 7, 2018. The AcSB has issued an Exposure Draft that revises and updates Section 3465, Income Taxes, to remove an outdated example and requires future income tax assets and liabilities to be presented as non-current. Stakeholders are encouraged to submit their comments by December 5, 2018.

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.