Читать книгу Annual Accounting and Auditing Workshop - Kurt Oestriecher - Страница 41

Congress passed the Tax Cuts and Jobs Act bill on December 22, 2017, which resulted in a significant lowering of the corporate tax rate from a graduated structure to a flat tax of 21 percent. Because most companies had used an expected tax rate of 34 percent in determining deferred tax assets and liabilities, the significant change in the corporate tax rate may have a significant impact on these estimates for the year ended December 31, 2018.

For items that flow through comprehensive income, the impact of deferred taxes is netted against the related gain or loss. However, GAAP dictates that the change in deferred tax assets and liabilities arising from changes in enacted rates be recognized in current earnings, not comprehensive income. Stakeholders informed FASB that this may cause misleading reporting because the original tax impact was recognized in other comprehensive income, not current earnings (commonly referred to as stranded tax effects).