Proposed Accounting Standards Update – Income Taxes (740): Simplifying the Accounting for Income Taxes
As part of its Simplification Initiative, FASB has issued an Exposure Draft proposing changes to ASC Topic 740, Income Taxes. The proposal would simplify the accounting for income taxes by removing certain exceptions in the area of financial reporting for taxes. The proposal would also make Codification improvements to promote consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending guidance that already exists. Comments are due June 28.
You can read the Exposure Draft, which was Issued on May 14, here.
Income tax accounting can be difficult due to differences between book accounting and the actual tax return. This video examines some niche areas that are being updated within the overall Simplification initiative.
“The goal here is not to make things more difficult,” Galasso says, “It’s actually to take things that were identified as being difficult and make them easier. This is focusing on looking at a lot of the exceptions that currently exist in Topic 740 and trying to streamline and standardize so we don’t have as many exceptions to the rule.”
Interested parties may submit comments within this short time period in one of three ways:
- Use the electronic feedback form available on the FASB website at Exposure Documents Open for Comment
- Email comments to email@example.com, File Reference No. 2019-700
- Send a letter to: Technical Director, File Reference No. 2019-700, FASB, 401 Merritt 7, PO Box 5116, Norwalk, CT 06856-5116
What questions do you have? Send your questions to firstname.lastname@example.org.
SCACPA is excited to partner with Galasso Learning Solutions and the Genuine Learning Blog for real-time A&A updates and answers for SCACPA members. With over 15 years of experience in the accounting profession, Melisa Galasso designs and facilitates courses in advanced technical accounting and auditing topics, including not-for-profit and governmental accounting. She closely monitors regulatory bodies for changes in auditing and accounting guidance and serves as a subject matter expert in implementing the updated guidance.
Melisa was a speaker on audit topics at SCACPA’s 2019 Spring Splash. Look for her to return this November for Fall Fest as well as many seminars and rebroadcasts.