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.

IASB publishes amendments related to the recognition of deferred tax assets for unrealized losses

  • IASB document Image

Jan 19, 2016

The IASB has published final amendments, “Recognition of Deferred Tax Assets for Unrealised Losses,” to the guidance in IAS 12, “Income Taxes.”

The amendments clarify the following:
  • Un­re­al­ized losses on debt in­stru­ments mea­sured at fair value and mea­sured at cost for tax pur­poses “give rise to a de­ductible tem­po­rary dif­fer­ence [re­gard­less] of whether the debt in­stru­ment’s holder expects to recover the car­ry­ing amount of the debt in­stru­ment by sale or by use.”
  • “The car­ry­ing amount of an asset does not limit the es­ti­ma­tion of prob­a­ble future taxable profit.”
  • Es­ti­mates of future taxable profit exclude “tax de­duc­tions re­sult­ing from the re­ver­sal of de­ductible tem­po­rary dif­fer­ences.”
  • An entity as­sesses a de­ferred tax asset in com­bi­na­tion with other de­ferred tax assets. When tax law re­stricts the uti­liza­tion of tax losses, an entity assesses a de­ferred tax asset in com­bi­na­tion with other de­ferred tax assets of the same type.

The amendments are effective for annual periods beginning on or after January 1, 2017; earlier application is permitted. As transition relief, an entity may recognize the change in the opening equity for the earliest comparative period in opening retained earnings on initial application without allocating the change between opening retained earnings and other components of equity. The Board has not added additional transition relief for first-time adopters.

For more information, see Deloitte's IFRS in Focus newsletter, as well as the press release and amendments 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.