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IAS-12

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › IAS-12

  • This topic has 3 replies, 2 voices, and was last updated 2 months ago by P2-D2.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • June 2, 2022 at 12:41 am #657102
    maximus07
    • Topics: 375
    • Replies: 380
    • ☆☆☆☆

    Professor Can you guide me what should I do if I have opening balance given in Trial Balance as Deferred Tax Liability and I calculated the closing balance as Deferred Tax Asset.

    June 4, 2022 at 9:26 am #657329
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6158
    • ☆☆☆☆☆

    Hi,

    You don’t do anything different to what we’ve done previously. The deferred tax asset is shown on the SFP and the movement shown in the SPL. Given that we are going from a deferred tax liability to a deferred tax asset the movement will give rise to a credit entry through profit or loss as we remove the liability and create the asset.

    Thanks

    June 4, 2022 at 6:19 pm #657377
    maximus07
    • Topics: 375
    • Replies: 380
    • ☆☆☆☆

    For example, we have at Starting of year Deferred tax liability of 250 and End of year we have deferred tax asset of 150. So we will show Deferred tax Credit of 400 in PNL?

    June 5, 2022 at 9:48 am #657427
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6158
    • ☆☆☆☆☆

    Correct. As to change the liability to the asset we would need to DR Deferred tax 400 CR SPL 400

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