EFRAG and UK ASB issue discussion paper on income tax
The European Financial Reporting Advisory Group (EFRAG) and the UK Accounting Standards Board (UK ASB) have issued discussion paper 'Improving the Financial Reporting of Income Tax'.
The discussion paper provides possible enchancements to the requirements for financial reporting of income tax currently in IAS 12. Specifically, it provides possible changes to the reconciliation of tax expense to a standard rate; revisions to the requirements in respect of uncertain tax positions; and whether deferred tax should be discounted. Further, the discussion paper provides alternative approaches that could result in a replacement standard of IAS 12. The alternative approaches are the flow-through approach, the partial allocation approach, the valuation approach, and the accruals approach.
Comments on the paper are invited by 29 June 2012. The discussion paper can be downloaded via the press release on EFRAG's website.