2175. The impact of deferred taxes on key business figures under IAS 12
Invited abstract in session TD-6: Financial Reporting, stream Financial Management and Accounting.
Thursday, 14:30-16:00Room: H9
Authors (first author is the speaker)
| 1. | Carolin Famulla
|
| Chair for Quantitative Accounting & Financial Reporting, Bielefeld University |
Abstract
Deferred taxes are defined as expected future tax payments or refunds arising from temporary differences between the accounting and tax balance sheet, according to International Accounting Standard No. 12. As such, deferred taxes affect the comprehensive income and the equity with regard to the financial statement. According to the balance-sheet-oriented temporary-concept, deferred taxes relate to items recognized both inside and outside profit and loss. In addition, deferred taxes have an impact on different key business figures. Generally, this effect is temporary due to the compensatory nature of deferred taxes. But under certain conditions, deferred taxes can have a permanent effect on key business figures, such as the percentage of self-financing. This key figure is a percentage measure for the permanent distributable income as a proportion of equity. Considering accounting discretion, I have modelled the effect of deferred taxes recognized both inside and outside profit and loss on the self-financing ratio. The presented approach analyzes the impact of deferred taxes on the percentage of self-financing, particularly under which conditions the effect is temporary or permanent, and how deferred taxes influence the objective of maximizing the self-financing ratio.
Keywords
- Accounting
Status: accepted
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