Thank you in advance!
Is there a question?
we gonna have to read his mind. !!
I know my mind goes blank when I think about DTA/DTLs, so maybe he just gave up after writing the subject title.
Ok ill ask the question for him, can someone expain DTA/DTL really really really chewed up? I cant seem to grasp them.
Difference between actual tax paid and tax provsion as per income statement which is expected o be reversed in coming years. Please correct me if i’m wrong
With a DTA, you pay more tax now;
With a DTL, you will have to pay more tax in the future.
It’s just a reconcilment to taxes. Your income statement has a different taxable income than what you actually reported in your taxes. So these DTA/DTLs adjust for these differences. If you used double declining on your Income Statement, well NI will be lower than your taxes because you are reporting straight line. That difference is tax isn’t going away, it’ll end up evening out over the life of that asset being deperciated – and the DTA/DTL are used to adjust for those values over time.