Accounting estimates (IAS 8)

Income tax = measurement uncertainty - because tax legislation is sometimes unclear and subject to interpretation Deferred tax = less uncertainty - it's an objective calculation - but I suppose you could argue that changes in future tax rates make measurement uncertain I would hope that your question is too theoretical for what is now a practical exam :) :)

Thank You, Sir. Therefore, we could state the current tax as accounting estimate as well as the deferred tax assuming that the tax rate changes in the future. I did not really get what you have mentioned by stating the question as too theoretical which is now practical. May I know whether you have meant that the income tax standard is more tested numerically rather than theoretically?

The exam is testing whether we can apply the standards in practice. As long as you can explain why a temporary difference arises in a given scenario, you will be fine. I wouldn't expect many marks for numbers because tax is a 'mechanical' topic. :)