IASB amends IFRS 1 and IAS 12
Dec 20, 2010
The International Accounting Standards Board (IASB) has published amendments to IAS 12 'Income Taxes' and IFRS 1 'First-time Adoption of International Financial Reporting Standards'.
IAS 12 Income Taxes requires an entity to measure deferred tax relating to an asset depending on whether the entity expects to recover the carrying amount of an asset through use or sale. The amendment provides a practical solution to the application of these requirements in relation to investment property under IAS 40 Investment Property, introducing a presumption that recovery of the carrying amount of an investment property will normally be through sale.
The amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards made two limited amendments:
- replacing references to "1 January 2004" with "the date of transition to IFRSs", eliminating the need for entities adopting IFRS for the first time to restate derecognition transactions occurring prior to the date of transition to IFRS
- providing guidance on how an entity should resume presenting financial statements in accordance with IFRS after a period when the entity was unable to comply with IFRS because its functional currency was subject to severe hyperinflation.
Click for:
- IASB press release on Deferred Tax: Recovery of Underlying Assets: Amendments to IAS 12 (PDF 33k)
- IASB press release on Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters: Amendments to IFRS 1 (PDF 33k)
- IAS Plus summary of income taxes project
- IAS Plus summary of IFRS 1 fixed dates project
- IAS Plus summary of IFRS 1 hyperinflation project
