scholarly journals THE INFLUENCE OF TAX DIFFERENCES ON THE INDICATORS OF FINANCIAL RESULTS OF BUSINESS ENTITIES: IDENTIFICATION AND ACCOUNTING

2021 ◽  
Author(s):  
Oksana Ponomarenko ◽  
Nataliya Kantsedal
Keyword(s):  
Income Tax ◽  
Economic Space ◽  
Deferred Tax Assets ◽  
Tax Legislation ◽  
Special Rules ◽  
Business Entities ◽  
Deferred Tax ◽  
Recognition And Response ◽  
The Impact ◽  
Tax Accounting

The article establishes the measure and direction of the influence of tax differences on the indicators of financial results of business entities and outlines approaches to the construction of an adequate accounting mechanism for income tax collection processes. An analysis of the impact on the financial result of a number of tax differences arising from typical business transactions: accrual of depreciation, disposal of an object of fixed assets, etc. It was proved that in the economic space of Ukraine there was no completion of the processes of final implementation of the simplification of the determination of the object of taxation by income tax of legal entities by synchronizing the indicators of "accounting" and "tax" profit. Measures implemented with the introduction of the Tax Code to harmonize the regulatory framework of accounting and tax accounting for taxation of profits of enterprises were analyzed. Details are given of the characteristics of income recognition for tax purposes by date and special rules for income recognition after the abolition of the category "gross income". It was established that the implementation of tax legislation regarding financial results is carried out by means of recognition and response to the presence of tax differences. Today, there are differences in the accrual of depreciation of non-negotiable assets with respect to financial performance; differences from the formation of reserves and collateral, differences in transactions for the sale or disposal of securities; Differences from financial transactions. The article discloses the essence of methodological approaches to calculating tax differences for such operations. The conclusion is justified that crisis phenomena in the country's economy and the impact of the pandemic on the global economic space actualize the need to reflect not only real, but also potential assets and liabilities, in particular deferred tax assets and deferred tax liabilities. The introduction of new documentary forms of accounting for tax differences and separate income and expenditure accounts for tax purposes can also be considered as areas of improvement of income tax accounting.

scholarly journals DEFERRED INCOME TAX: IMPACT ON FINANCIAL AND TAX REPORTING (THE PRACTIСE OF UKRAINE AND GERMANY)

2021 ◽  
Vol 4 (39) ◽  
pp. 138-148
Author(s):  
O. Malyshkin ◽  
S. Rohoznyi ◽  
O. Yarmolitska ◽  
Yu. Ostapenko
Keyword(s):  
Financial Reporting ◽  
Income Tax ◽  
Jel Classification ◽  
International Standards ◽  
Tax Base ◽  
Deferred Tax Assets ◽  
Deferred Tax Liabilities ◽  
Deferred Tax ◽  
Tax Reporting ◽  
The Impact

Abstract. Income taxation is typical for most countries with their own peculiarities. In the practice of the Ukrainian enterprises, there is a lack of relationship between accounting and tax accounting to reflect the deferred tax asset and deferred tax liability in the reporting. The purpose of the article is to analyze the income tax in terms of its calculation by the international standards and identify key tax differences. The authors proposed to formulate the definitions of the current income tax which should be understood as the amount of income taxes payable (reimbursed) on taxable profit (tax loss) for the period and expenses (income) from income tax which should be understood as the total amount included in the determination of profit or loss for the period in accordance with current and deferred taxes. This interpretation of the definitions will help better understand the concepts in accounting and taxation. The tax base of assets and the tax base of liabilities are given and substantiated. The temporary differences were identified by authors. The example of definition of Deferred tax liabilities and Deferred tax assets, the order of their reflection in the report on financial results (about the total income) and disclosure in the Notes to the financial reporting is considered and analyzed. The impact on the indicators of the Income Tax Return is investigated. There is no direct impact of the amount of the Deferred tax assets / Deferred tax liabilities according to the current algorithm for the object of taxation, which is determined by tax legislation. The conclusions are made about the importance of determining of Deferred tax liabilities and Deferred tax assets, which directly affects the amount of net profit. The result of the study was confirmation of the hypothesis concerning different orientation of norms of the legal documents on the display of information in the forms of the financial and tax reporting. Such differences are related to the different requirement to the reporting by the modern stakeholders. Keywords: income tax, deferred tax, tax asset, tax liability, reporting. JEL Classification M40, М41, М48 Formulas: 0; fig.: 2; tabl.: 5; bibl.: 16.

scholarly journals Deferred tax analysis and impact on firm's economic efficiency ratios

2005 ◽  
Vol 53 (6) ◽  
pp. 33-44 ◽  
Author(s):  
Hana Bohušová ◽  
Patrik Svoboda
Keyword(s):  
Income Tax ◽  
Financial Analysis ◽  
Accounting System ◽  
Theoretical Level ◽  
High Quality ◽  
Business Entities ◽  
Deferred Tax ◽  
High Level ◽  
The Impact ◽  
Retained Earnings

Category of deferred income tax is a complex topic including the whole accounting system and the income tax. Calculation method can be time-consuming and demanding a high quality system of analytical evidence and a system of valuation and demanding the high level of accountants' knowledge. The aim in the theoretical level was to analyze process of calculation and recording of deferred tax. Importance of recording of deferred tax and the impact on financial analysis ratios was analyzed. Fourteen business entities were examined. Deferred tax recording is a legal way to reduce retained earnings a to protect of its careless alocation.

THE IMPACT OF INFORMATION TECHNOLOGIES ON THE REGIONS’ ECONOMIC SECURITY

2017 ◽  
Author(s):  
Yuliya Tymchyshyn ◽  
Keyword(s):  
Information Technology ◽  
Information Technologies ◽  
Organizational Structures ◽  
Economic Security ◽  
Deep Penetration ◽  
Short Term ◽  
Economic Space ◽  
Business Entities ◽  
Short Term Forecasting ◽  
The Impact

The article highlights the impact of information technology on the economic security of regions and threats to economic security of the region that arise from the use of information technology. The system of economic security of the region in the context of development and application of information technologies is considered, which should include the following elements: diagnostics and identification of the existing state of economic security of the region; identification of threats to the economic security of the region from the use of information technology by business entities and from trends and problems in the development of the IT sector in the region; assessment of identified threats; development of effective mechanisms for their prevention; ensuring the increase of the level of economic security of the region with observance of the balance of national, regional and local interests; monitoring the level of economic security of the region. The main tasks of monitoring the economic security of the region in the context of development for the use of information technology are analyzed: monitoring the state of development of the IT sphere of the region and the level of ICT use in the activities of enterprises; timely detection of changes occurring in the IT sphere of the region and in the activities of economic entities of the region in the process of using information technology, and the reasons that caused them; prevention of negative trends leading to the formation and development of tensions in the IT sphere and socio-economic space of the region to prevent threats to its economic security; implementation of short-term forecasting of trends in the most important processes in the IT sphere of the region and in the functioning of economic entities from other sectors of the economy, due to the widespread use of IT in commercial, management and production activities; assessment of the effectiveness of methods, organizational structures and processes of managing the economic security of the region in terms of information development of society and the deep penetration of IT in various areas of management and economic activity at the regional level. The principles of monitoring the economic security of the region in the context of development and application of information technologies are revealed. The requirements to be met by the mechanism of economic security of the region, related to the intensification of informatization processes and the development of the IT sphere, are described. The functions that should be performed by the mechanism of economic security of the region (MESR) related to the intensification of informatization processes and the development of the IT sphere are substantiated. The main groups of computer crimes with the use of information computer technologies are identified, which have an extremely sharp impact on the economic condition of both a particular enterprise and the region as a whole.

Decomposing Changes in Deferred Tax Assets and Liabilities to Isolate Earnings Management Activities

2004 ◽  
Vol 26 (s-1) ◽  
pp. 43-66 ◽  
Author(s):  
John D. Phillips ◽  
Morton Pincus ◽  
Sonja Olhoft Rego ◽  
Huishan Wan
Keyword(s):  
Earnings Management ◽  
Income Tax ◽  
Deferred Tax Assets ◽  
Using Data ◽  
Deferred Tax ◽  
Annual Earnings ◽  
Tax Expense ◽  
Footnote Disclosures

This paper provides evidence on the types of accounts that reveal earnings management activities. We build on Burgstahler and Dichev's (1997) evidence of earnings management to avoid an earnings decline and Phillips et al.'s (2003) findings that deferred tax expense (DTE) can be used to detect such earnings management. In particular, we investigate the relation between changes in annual earnings and changes in deferred tax asset and liability components using data hand-collected from firms' income tax footnote disclosures. Our evidence indicates that changes in the net deferred tax liability (DTL) component related to revenue and expense accruals and reserves can be used to detect earnings management to avoid an earnings decline. In addition, we build on Joos et al.'s (2003) results and partition our sample into firm-years with positive and negative changes in net DTLs and repeat our analyses. In contrast to the Joos et al. (2003) finding that DTE can be used to detect earnings management only for firm-years in which DTE is negative, we find that both subsamples reflect earnings management of revenue and expense accruals and reserves to report earnings increases.

scholarly journals PECULIARITIES OF FINANCIAL AND TAX ACCOUNTING OF TRANSACTIONS ON DEBT CONVERSION

2016 ◽  
Vol 15 ◽  
pp. 312-321
Author(s):  
D. Yu. Poroshin ◽  
N. Yu. Semenova
Keyword(s):  
Income Tax ◽  
Value Added ◽  
Financial Accounting ◽  
Value Added Tax ◽  
Tax Legislation ◽  
Definition Of ◽  
Economic Studies ◽  
Tax Accounting

The article deals with peculiarities of conducting forensic economic studies connected with collecting income tax and value added tax as well as the order for recording debt conversion in financial accounting. It discusses methods that are used while conducting the studies, lists the relevant articles of normative acts that regulate the order of recording debt conversion transactions in financial accounting. It also considers a number ofpossible situations for debt conversion transactions, the order of recording them in financial accounting and tax consequences of these transactions. Having analyzed the requirements of the tax legislation, the article claims that debt conversion transactions constitute an object exempt of income tax and vale added tax because: such transactions cannot be classified as obtaining income and do not constitute trade in debt obligations; the transfer of credit debt of one debtor to another is still a liability and not a commodity (work or service); such transactions do not conform with any definition of transactions for the supply of goods, services or factoring.

ACCOUNTING OF DEFERRED TAX ASSETS AND LIABILITIES: HISTORICAL EXCURSION AND MODERN REALITIES

2021 ◽  
Author(s):  
Ольга Височан ◽  
Тетяна Івасюк
Keyword(s):  
Income Tax ◽  
Historical Context ◽  
Current Position ◽  
Deferred Taxes ◽  
Accounting Standard ◽  
Deferred Tax Assets ◽  
Deferred Tax ◽  
Historical Methods ◽  
Algorithmic Process ◽  
Methodological Difficulties

The article considers the essence of deferred tax assets and liabilities and their reflection in the system of accounts and registers in the historical context. The periodization of the process of formation and development of the problem of deferred taxes in Ukraine with the use of normative and historical methods of cognition is carried out. The differences between permanent and temporary differences in tax profit (loss) and accounting profit (loss) are described. The approach to accounting for deferred taxes and their place in the reporting of enterprises using an algorithmic process is generalized. A detailed description of the current position of accounting for deferred taxes through the viewpoint of Ukrainian accounting standard 17 "Income Tax". Conclusions are made on the possibility of further research on the elimination of methodological difficulties in the allocation of certain tax differences to temporary or permanent.

scholarly journals THE EFFECTS OF LABOUR COSTS REDUCTION ON FOREIGN INVESTMENT IN ROMANIA

2019 ◽  
Vol 19 (3) ◽  
pp. 129-137
Author(s):  
Adina TRANDAFIR
Keyword(s):  
Foreign Investment ◽  
Income Tax ◽  
Econometric Analysis ◽  
Corporate Income Tax ◽  
Foreign Investments ◽  
Tax Legislation ◽  
Labour Costs ◽  
Legislative Changes ◽  
Fiscal Pressure ◽  
The Impact

This article addresses the issue of changes in tax legislation in our country over the last 20 months, in view of the effect they have on the level of foreign investment. The article presents, besides the actual legislative changes and the evolution registered in this period by foreign investments, also the fiscal pressure in the field of contributions, VAT and corporate income tax. The paper presents an econometric analysis that seeks to highlight the impact of the fiscal pressure of the above mentioned taxes on the FDI level recorded in Romania between January 2017 and August 2018.

scholarly journals ENTITY TAX EFFICIENCY ANALYSIS

2018 ◽  
pp. 193-199
Author(s):  
Svitlana Kalabukhova
Keyword(s):  
Income Tax ◽  
Analytical Procedure ◽  
Financial Statements ◽  
The State ◽  
Document Management ◽  
Information Culture ◽  
Tax Efficiency ◽  
Business Entities ◽  
The Impact ◽  
Retained Earnings

Introduction. The necessity of estimation by various groups of stakeholders of the tax system influence on the financial results of business entities has led to the emergence of tax analysis. The key task of tax analysis is to substantiate the economic decisions, which aim to optimize tax expenses from the profit of the enterprise. A number of issues still remains unsolved. These issues are connected with the analytical procedure of external users understanding of the impact of the tax policy of the company on its financial results according to the financial statements. Purpose. The article aims to study and to develop the analysis of the tax efficiency of a business entity that provides the external users with financial reporting an understanding of the intentions of management personnel as for the owners and investors capital preservation and the state interests’ realization. Results. The investigation of issues, which are connected with the disclosure of information on expenses on corporate income tax in the financial statements has been extended. New analytical indicators of tax efficiency and additive factor models of expenses on corporate profit tax have been proposed. The importance of calculating the analytical indicator "effective tax rate on profit" has been substantiated. It has been reasoned that the analysis of the formation of the income tax enables the search for additional free sources of financing for the activity. An analytical procedure for understanding the tax efficiency of an entity has been developed. The procedure of testing for the risk of non-payment of income tax by the entity has been proposed. The procedure for assessing the risk of lowering retained earnings in the future due to the deferred income tax in the reporting period has been disclosed. The form of an analytical table, which can facilitate the unification of the management document "Management Report" in terms of the characteristics of the tax environment of the entity, has been developed. The stencil of the analytical conclusion as for the tax efficiency of the business entity, which promotes the information culture of documenting the generalizations about the intentions of the managerial staff regarding the owners' and investors' capital preservation and the state interests’ realization, has been proposed.

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