As matters of income tax can have specific caveats that involve uncertainty, these were addressed specifically by the IASC.
As business can span the globe, it is important to recognize the fact that there are many different tax jurisdictions that a company may operate in and have liabilities due for. Furthermore, companies can have outstanding tax assets and/or liabilities with these jurisdictions which may or may not be recoverable. The general rule is that the tax rate in which the asset/liability is expected to be settled should be applied.
IAS are principles based standards, rather than strict rules based standards that govern international accounting. IAS standards differ from IFRS standards in that they were introduced prior to 2001, whereas IFRS were produced after this date by the IASB, or the International Accounting Standards Board. When determining the hierarchy of these, the IAS is considered to be the building blocks in which the newer and more relevant IFRS are founded and therefore IFRS is more authoritative when these conflict.
Accounting made easy, for FREE!
Access the contact form and send us your feedback, questions, etc. We are always welcome to help someone out. You can also contact us if you wish to submit your writing, cartoons, jokes, etc. and we will consider posting them to share with the world! The Facebook and LinkedIn groups are also good areas to find people interested in accounting like yourself, don’t hesitate to join as everyone of all levels are welcome to become part of the community.