Temporary Differences
Statement Purpose
This statement provides a detailed breakdown of the temporary differences between carrying value and tax value of an asset/liability.
Data Flow
The information from
Balance Sheet
will transfer into this statement for selected financial statement items identified as deferred tax.These tax value financial statement items can be found in
Tax items and descriptions
, which can be made available under Set up.If
Accounting
was selected for any unrealised gain or loss item in Calculation Setup
, any unrealised gain or loss information from Balance Sheet
will be transferred automatically into this statement as both carrying value and tax value. This represents that any unrealised gain or loss tax value is equivalent to its carrying value.If
Tax
was selected, the value from Statement of unrealised income
will transfer only to the tax value in this statement.Explanation of Fields
Carrying Value as per Balance Sheet
– The accounting values from Balance Sheet will be transferred to this column.Tax Value
Balance Sheet
– The tax value of specified deferred tax line items from Balance Sheet
will appear in this column. Any tax value manual input will be required under Tax value manual override
.Unrealised gain/loss
– The selection between Accounting
and Tax
in Calculation Setup
will determine whether the accounting values will appear in this column for unrealised gain or loss items. If Accounting
has been selected, it is assumed that the carrying value of the balance sheet item equals the tax value. If Tax
is selected, this column will have no value. Any tax value manual input will be required under Tax value manual override
.Tax value manual override
– Where the tax value present in the tax value column is incorrect, manual input is required to override the tax value. The deferred tax calculation will take the input in this column instead of the tax value column. The value entered here should be the correct tax value, not an adjustment amount, as it overrides any value present in the tax value column.Exception amount
– Where there are amounts that must be excluded from calculating temporary differences, manual input is required. The calculation of temporary differences will exclude any exception amount.Temporary Difference (DTA/DTL)
– The temporary differences between carrying value and tax value will be calculated and shown in this column. If it is a positive amount, it is a deferred tax asset, whilst if the amount is negative, it is a deferred tax liability.As an internal check, the statement also includes a variance check to ensure that the total deferred tax liability/(asset) on this statement agrees to the total unrealised net income on the
Statement of unrealised income
. There should be no variance in this cell. The formula is set to accept $2 immaterial variance.Signage
- Carrying and tax values are positive amounts.
- Tax value override amount can be positive or negative amounts.
- Exception amount can be positive or negative amounts.
- Deferred tax assets are shown in positive amounts.
- Deferred tax liabilities are shown in negative amounts.