Deferred tax (cash flow statement)

This topic has 4 replies, 2 voices, and was last updated 5 years ago by Stephen Widberg.

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October 17, 2019 at 7:52 am #549835
alikhakar
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Sir I got a little confused here..
DEFERRED TAX PROVISION
Opening balance 689
Decrease in provision (134)
Closing balance. 555
TAX PAYABLE
Opening balance 2989
Closing balance. 4278
Tax charged in SOPL 2038
In kaplan text the reconciliation is done like this
Opening (2566+689) = 3255
P&L. +2038
Tax paid (balance). (1016)
Closin bal(3722+555)= 4277
My ques is.. Why the decrease in provision is not taken into account in reconciliation ? Also the decrease in provision should be added back to Profit before tax in CFS because its a non cash adjustment..but it has not been added in book.
If we take into account the decrease in provision then the tax paid comes to 882. What is correct ?
Thanks
October 17, 2019 at 8:38 am #549849
alikhakar
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Q2. How are the payments for OPERATING lease classified ?
October 17, 2019 at 6:58 pm #549929
Stephen Widberg
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I would have added together the 2 opening balances 689+2989
Added on the SPLOCI charges 2038 + anything in the OCI
Compared to the closing balances 555 + 4278
Balance would be cash paid
Re your other question operating leases no longer exist in lessee accounting
October 22, 2019 at 8:16 am #550414
alikhakar
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Re: que2, sorry i meant how will be the cash flows for operating lease be classified from the lessee’s point of view.
October 22, 2019 at 8:38 am #550418
Stephen Widberg
Keymaster
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From a lessee’s perspective there is no such thing as an operating lease – please review IFRS 16
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