03 August 2010
Dear Experts, Can anyone clarify me regarding the applicability of Accounting Standard - 22 (Accounting of Taxes on Income) incase of a public limited company where the previous years was loss only for this year it is profit. Previous Year's Deferred Tax Liability/Asset has not been provided in the book. Please clarify me it is urgent Sir... With regards, Rajesh.
18 August 2010
If the return for the loss making year has been filed in time, the assessee is entitled to carry forward the loss to the subsequent year and set it off against the profit. After setting off the full profit, still there is unabsorbed loss,to that extent, deferred tax asset can be booked provided there is virtual certanity followed by convincing evidence that sufficient profit will emerge in the next year.
CAclubindia
