This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.
The full functionality of our site is not supported on your browser version, or you may have 'compatibility mode' selected. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox.

IFRS Interpretations Committee publishes draft interpretations related to income taxes and foreign currency transactions

  • IFRS-IC document (dk green) Image

Oct 21, 2015

The IASB’s IFRS Interpretations Committee has published two draft interpretations: (1) "Uncertainty Over Income Tax Treatments" and (2) "Foreign Currency Transactions and Advance Consideration." The proposals are being issued to address diversity in practice in the application of IAS 12, “Income Taxes,” and IAS 21, “The Effects of Changes in Foreign Exchange Rates,” respectively.

The draft interpretation related to income taxes would clarify that the recognition and measurement of a “current or deferred tax asset or liability” under IAS 12 should “be based on taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates that are determined in accordance with [the draft interpretation] if there is uncertainty over income tax treatments.”  

The draft interpretation related to foreign currency transactions would address “how to determine the date of the transaction for the purpose of determining the spot exchange rate used to translate the asset, expense or income (or part of it) on initial recognition that relates to, and is recognised on the derecognition of, a non-monetary prepayment asset or a non-monetary deferred income liability.”

Comments on both draft interpretations are due by January 19, 2016. For more in­for­ma­tion, see the press release on the IASB’s Web site.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.