IFRIC Interpretation DI/2015/1 Uncertainty over Income Tax Treatments

The IFRS Interpretations Committee has published a proposed Interpretation of Standards on uncertainty over income tax treatments and how it affects the accounting for income taxes.

On 21 October 2015, the IFRS Interpretations Committee published for public comment a proposed Interpretation of Standards aimed at giving guidance on how uncertainty over income tax treatments should affect the accounting for income taxes.

Currently, IAS 12, Income Taxes does not provide specific guidance for how uncertainty about a tax treatment should be reflected in the accounting for income tax. 

The proposed interpretation forms part of the authoritative International Financial Reporting Standards (IFRS) requirements.

ACCA supports the Interpretation Committee’s proposed draft Interpretation, as it contributes to greater clarity and consistency in accounting approaches in this area. However, we would urge that:

  • The Interpretation Committee considers further the difficulties of recognising and disclosing the effects of uncertainty over income tax treatments in the period to which the income tax treatments relate, without using hindsight.
  • The Interpretation Committee clarifies the interpretation in relation to a number of areas, and that
  • The Interpretation Committee considers exploring the potential for alignment between IAS 12 and IAS 37.

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