Page 47 - FINAL CFA I SLIDES JUNE 2019 DAY 8

CV > Tax base or Taxable income < pre tax income = DTL
Session Unit 8:

For expense: Tax base < Accounting base or Taxable income > pre tax income = DTA 30. Income Taxes

Example: Temporary and permanent differences between taxes payable and income tax expense,
p.255. Using the following table, identify the type of difference (taxable temporary, deductible
temporary, or permanent), and determine if the difference creates a DTA or a DTL.

Higher depreciation T, TI < PTI DTL
tanties DTA
Capitalised Expensed T, TI > PTI
Provisions
not allowed T, TI > PTI DTA

Typically, no taxable P, TI = PTI -

T, TI > PTI DTA
Cash is revenue
T, TI > PTI DTA
Only when claimed
P, TI = PTI -
Not tax deductible

Same tax base P, TI = PTI -
Same tax base P, TI = PTI -