Our ‘IFRS Viewpoint’ series provides insights from our global IFRS Team on applying IFRSs in challenging situations. Each edition will focus on an area where the Standards have proved difficult to apply or lack guidance. This edition provides guidance on the potential accounting consequences arising from the recent reform of the United States’ tax system.
What’s the issue?
On 22 December 2017, the President of the United States (US) signed into law the ‘Tax Cuts and Jobs Act’ (Act). The Act is a sweeping reform of US taxation which is likely to have a significant impact on financial statements prepared under IFRS for entities with US operations.
Furthermore, because the Act became law on 22 December its effects must be included in interim and annual reporting periods that include that date. The range and complexity of the Act means that companies with US operations need to analyse the impact of the Act in detail. This IFRS Viewpoint addresses some of the issues that entities will face when doing so.