Consolidated report on the European outreach events on the discussion paper 'Improving the Financial Reporting of Income Tax'
Sep 04, 2012
The European Financial Reporting Advisory Group (EFRAG) has posted to its website a feedback statement reflecting input received from four European events on the discussion paper 'Improving the Financial Reporting of Income Tax', held earlier this year in London, Milan, Vienna and Warsaw.
The outreach events gave practitioners and others an opportunity to voice their opinions on topics considered in the discussion paper on the financial reporting of income tax (published in December 2011). These opinions will be considered in future proactive work on this topic.
The discussion paper provided possible enhancements to the requirements for financial reporting of income tax currently in IAS 12 Income Taxes. Overall, respondents noted that (1) existing guidance should be improved and (2) all exceptions allowed under IAS 12 should be removed.
The paper provided alternative approaches that could result in a replacement standard of IAS 12. The temporary difference approach was the best received, with participants noting it's consistency with the underlying principles of IFRS.
Overall, participants expressed their support in maintaining IAS 12 in order to: