Working with Regional Deferred Tax
The Deferred Tax Regional form is used to view the deferred tax calculation.
Tax Reporting calculates Deferred Tax on assets and liabilities. The calculation requires the book and tax basis of assets and liabilities as inputs. In Tax Reporting, the difference between the book and tax basis is calculated, and the tax rate applied to determine the amount of deferred tax asset and liability.
Table 12-4 Example of Deferred Tax
| Example: Property, Plant, Equipment | |
|---|---|
| Book Basis | 1,000,000 |
| Tax Basis | 900,000 |
| Difference | (100,000) |
| Tax Rate | 20% |
| Deferred Tax Liability | (20,000) |
Note:
Due to accelerated depreciation for tax purposes, the tax basis is less than the book basis, giving rise to a deferred tax liability.If you want to classify deferred tax settings, seeClassifying Deferred Tax Assets and Liabilities.
To access the Deferred Tax Regional form:
- From the Home page, click Tax Provision Regional, and then Package Regional.
- Select the Deferred Tax Regional tab.
- Expand column headings
to see all categories.
The Deferred Tax Regional form contains the following headings across the columns:
Table 12-5 Regional Deferred Tax Column Headings
| Category | Subcategory | Description and Subcategories |
|---|---|---|
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Opening Balance As Adjusted |
The tax effect of the prior year end temporary differences, including the tax effect of the opening balances for federal benefit of state taxes, deferred tax not recognized, and prior year adjustments. |
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Opening Balance |
The tax effect of the prior year end temporary differences before the tax effect of the opening balances for federal benefit of state taxes, deferred tax not recognized, and prior year adjustments. |
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Opening Balance Adjustment |
The sum of Total Opening Balance, and prior year adjustments. |
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Prior Year Adjustment - Losses And Credits |
The Total of the adjustments is copied from the Current Provision form to the corresponding Tax loss/credit account on the Temporary Differences form. This field is read-only. |
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Current Year Total |
The sum of Automated and Adjustments. |
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Automated Total |
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Adjustment Total |
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Return to Accrual (Deferred Only) |
The tax effect of the adjustments to temporary differences based on the regional Return to Accrual form. |
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Audit Settlements (Deferred Only) |
The tax effect of the adjustment to temporary differences resulting from regional audit settlements. |
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Other Adjustments (Deferred Only) |
The tax effect of the regional adjustments to temporary differences resulting from any other type of adjustment automated in Tax Reporting. |
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Other Adjustments (Deferred Only) |
The tax effect of the adjustment to temporary differences resulting from any other type of adjustment. |
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Other Adjustments Automated (Deferred Only) |
The tax effect of the adjustments to temporary differences resulting from any other type of adjustment automated in Tax Provision. |
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Transfers (Deferred Only) |
The tax effect of the adjustment to temporary differences resulting from transfers of Assets/Liabilities and the related temporary difference. |
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Prior Year Adjustment (Deferred Only) |
The tax effect of the adjustment to temporary differences resulting from prior year adjustments. |
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Contingency (Deferred Only) |
The tax effect of the adjustment to temporary differences resulting from tax contingencies related to temporary differences. |
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Impact from change in Tax Rates Regional |
The impact of change in regional tax rates on the opening balance and current year movement. If you enable Scenario - Entity Tax Rate Change to Equity feature, the system creates custom attribute for all the scenario members on the application. If you apply that custom attribute to any entity, impact from change in tax rates regional data will be moved to the Impact from Change in Tax Rates in Equity column for all the temporary difference accounts. See also: Enabling Application Features and Defining Entity Tax Attributes in Administering Tax Reporting |
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Impact from change in Tax Rates - Opening Balance |
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Impact from change in Tax Rates - RCCY |
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Impact from change in Tax Rates - Acquisitions Total |
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Total Deferred Expense |
The sum of deferred transfers, prior year adjustments, contingency and the impact from changes in Tax Rates. |
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Acquisition |
The tax effect of the adjustment to temporary differences resulting from the acquisition of assets and liabilities and the related temporary difference. |
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| Adjustment for Change in Tax Rates - Acquisition | ||
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Disposals |
The tax effect of the adjustment to temporary differences resulting from the disposals of assets/liabilities and the related temporary difference. |
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Total Equity |
The sum of equity Automated and Adjustments. |
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Equity Automated Total |
The tax effect of the adjustment to temporary differences resulting from equity transactions. |
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Equity Adjustments Total |
The tax effect of the adjustment to temporary differences resulting from equity transactions. |
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Equity Prior Year |
The tax effect of the adjustment to temporary differences resulting from equity transactions and return filing. |
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Equity Other |
The adjustment to temporary differences resulting from all other equity transactions. This amount is input manually and does not affect the deferred tax expense. |
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Impact from change in Tax Rates in Equity |
The tax effect of tax rate changes for accounts identified as equity. |
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Impact from change in Tax Rates in Equity - Opening Balance |
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Impact from change in Tax Rates in Equity |
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Total Equity Adjustments |
The sum of automated and equity adjustments. |
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Balance Sheet Total |
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Foreign Exchange |
The total currency translation on the opening balances and current year movements. |
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Foreign Exchange - Opening Balance |
The total currency translation on the opening balances. |
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Foreign Exchange - Current Year |
The total currency translation on the current year movements. |
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Ownership |
This amount is the total of Ownership Opening Balance and Ownership for the Current Year. |
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Ownership - Opening Balance |
This amount is the difference in the Opening Balance due to Ownership changes to the Parent. |
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Ownership - Current Year |
This amount is the difference in the Current Year due to changes in Ownership to the Parent. |
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Closing Balance Regional - Tax |
The sum of the tax effect of the opening balance plus current movements. |
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Closing Balance Regional Reclass - Non Current Assets |
The classification of the tax effect of the total net deferred tax assets and deferred tax liabilities. If the total tax effect is positive or an asset, then all deferred tax assets and liabilities will be classified as an asset. |
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Closing Balance Regional Reclass - Non Current Liabilities- |
The classification of the tax effect of the total net deferred tax assets and deferred tax liabilities. If the total tax effect is negative or a liability then all deferred tax assets and liabilities will be classified as a liability. |
The following entries are listed down the rows displayed on the Regional Deferred Tax form:
Table 12-6 Regional Deferred Tax Row Headings
| Category | Subcategory | Description and Subcategories |
|---|---|---|
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Total Temporary Differences (GAAP to Stat) |
User-defined upon implementation. |
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Total Temporary Differences (Stat to Tax) |
User-defined upon implementation. |
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Total Temporary Differences |
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Total National Tax Losses - Carryforward Automated |
Used for Tax Losses that are deferred. These are system-defined, and two accounts are provided: Current Year and Carryforward. Carryforward is linked to the Tax Losses form. |
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Total Tax Credits Carryforward |
The parent of system-provided base accounts that are used for Tax Credits that are deferred. |
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Tax Credit |
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General Business Credit |
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Jobs Credit |
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Total Tax Attributes |
User-defined upon implementation. Amounts are generally entered on a tax-effected basis in the temporary difference rollforward and are considered adjustments to deferred tax. |
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Deferred Tax Contingency |
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National Tax Attribute 2 |
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Total National temporary Differences, Losses, Credits and Attributes |
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Total Valuation Allowance |
This category is used to record valuation allowances against assets as required. The following accounts are provided: Noncurrent, Credits, and TaxLoss. Credits are entered on a tax-effected basis, while amounts entered in the other accounts are entered on a pretax basis. The form also provides the classification of deferred tax assets and liabilities as follows:
The Non-Current setting, together with the value of the Closing—Total Closing Balance, defines the column in which the amount is displayed. If this balance is positive, then the amount is classified as an Asset. If this balance is negative, then the amount is classified as a Liability. Valuation allowance is classified using a factor of -1 (for example, Closing*-1) and is therefore always reflected as a contra-asset. |
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Valuation Allowance - Credits |
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Valuation Allowance - Non Current |
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Valuation Allowance - Tax Losses |
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Deferred Tax National |
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Total Regional Temporary Differences |
The parent of system-provided base accounts that are used for Tax Credits that are deferred. |
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Total Temporary Differences - Regional |
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Total Regional Tax Losses |
This category is used for regional Tax Losses that are deferred. These are system-defined, and two accounts are provided: Current Year and Carryforward. Carryforward is linked to the Tax Losses form. |
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Total Regional Tax Losses Pre-Apportionment |
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Total Regional Tax Losses - Carryforward Automated |
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Total Regional Tax Losses |
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Total Regional Tax Credits |
The parent of system-provided base accounts that are used for Tax Credits that are deferred. |
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Total Regional Tax Credits - Carryforward |
This category is used for Tax Losses that are deferred. These are system-defined, and two accounts are provided: Current Year and Carryforward. Carryforward is linked to the Tax Losses form. |
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State Tax Credit |
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Regional Tax Credit 2 - XXXX |
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Regional Tax Credit 3 - XXXX |
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Regional Tax Attributes |
This category is user-defined upon implementation. Amounts are generally entered on a tax-effected basis in the temporary difference rollforward and are considered adjustments to deferred tax. |
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Regional Tax Attribute 1 |
The parent of a base account that is user-defined upon implementation. |
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Regional Tax Attribute 2 |
The parent of a base account that is user-defined upon implementation. |
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Regional Valuation Allowance |
The parent of a base account that is user-defined upon implementation. |
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Regional Valuation Allowance - Credits |
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Regional Valuation Allowance - Non current |
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Regional Valuation Allowance - Tax Losses |
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Total Regional Temporary Differences, Losses, Credits and Attributes |
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Total Deferred Tax - Regional |
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Total Deferred Tax National - No VA |