英语论文网

rges and credits explained in APB Opinion #11 did not make the list of ten financial statements. Also, in paragraph #241 it states that 'only the deferred method explained in APB Opinion #11, does not fit the definitions'. Therefore, deferred charges and credits should not be included on the Balance Sheet. 

SFAS NO. 96 

The board supported the comprehensive tax allocation notion of APB Opinion #11. The only difference was the board considered the balancing debits and credits as assets and liabilities. Making the Balance Sheet accounts for deferred taxes more meaningful in keeping with the FASB's conceptual framework was the major purpose of this pronouncement SFAS No. 96. It required the recognition and measurement of deferred tax liabilities and assets under the liability method. The objective of accounting for income taxes was to recognize the amount of current and deferred income taxes payable or refundable at the date of the financial statements as a result of all events that had been recognized in the financial statements and as measured by the provisions of enacted tax laws. 

Under SFAS No. 96, the tax liabilities and assets are adjusted for the effect of changes in the tax laws or rates. Firms could recognize tax liabilities but tax assets could only be recognized to the extent of tax liabilities. Because tax allocation was so complex at the time due to changes in the rates, FASB established an implementation group for tax allocation in 1988 and deferred implementation of SFAS No. 96. After FASB issued a special report in 1989 on implementation issues, complications led to the deferral of SFAS No. 96 again, until 1992, which shows the difficulty of obtaining a resolution on tax allocation issues. 

SFAS NO. 109 

FASB issued this statement to replace the complex SFAS No. 96 which was concerned with the recognition of deferred income taxes. SFAS No. 109 requires that deferred tax liabilities for all taxable temporary differences and deferred tax assets for all deductible temporary differences and tax credit and operating loss carry forwards be recognized. The Balance Sheet approach is used. Deferred income tax assets and liabilities represent assets and liabilities instead of residual deferred charges and credits. Under the liability method, an enterprise recognizes a deferred tax asset or a deferred tax liability for the future income tax effects of the difference between the tax basis of the asset or liability and its reported amount in the financial statements. 

Accounting for income taxes continues to be a source of controversy and difficulty for accounting standard-setters. This is corroborated by the fact that the APB and the FASB have three financial accounting standards all named the same, 'Accounting for Income Taxes'. Therefore, accountants have had to make multiple efforts to resolve this issue. There are three questions that help explain the difficulty to achieve consensus on this topic and what makes accounting for income taxes so difficult. 

ARE INCOME TAXES AN EXPENSE? 

According to SFAC No. 6, expenses are defined as (1) outflows of assets of the firm to produce revenue, (2) voluntarily, and up to the discretion of the firm as to whether the expenditures will be made, and (3) the objective of in本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。