Chapter Eight: Taxation

Question 1

How is tax for current and prior periods recognised in the SoFP?

Answer 1

As a liability.

Question 2

How is the tax recognised if the amount already paid exceeds the amounts for prior and current periods?

Answer 2

As an asset.

Question 3

If the estimate of tax is different from the actual figure when will this be adjusted? Should it be shown seperately?

Answer 3

In the next year’s tax provision. Only shown separately if material.