Deferred Tax Accounting Disclosure Practices of Indian Companies - An Analytical Study
Author(s):
Savitha P. R.
Keywords:
Deferred tax accounting, AS- 22, Ind AS- 12, Timing difference. Deferred Tax Assets, Deferred Tax Liability.
Abstract
Purpose: A true and fair disclosure of information on deferred tax in companies' annual reports is needed to understand the significance of deferred tax by the users of accounting information. The level of awareness on deferred tax among the listed companies in India is high as the Accounting Standard on Deferred taxes is mandatory for Indian companies. Though Accounting standards prescribe the standard rules to be followed to disclose the information on deferred tax, the way of disclosure of deferred tax is not unique among the companies in India. The study aims to identify the extent of disclosure of deferred tax assets and deferred tax liabilities in annual reports of listed companies in India and to understand the level of awareness of deferred tax among companies. Methodology: This study is conducted based on secondary data from the annual reports of ten sample companies for the year 2017-18. A hypothesis is formulated to reveal the facts about the level of disclosure of deferred tax among the sample companies. The study used descriptive statistics, and the inferential statistical tool ANOVA is applied for the logical analysis of data. The result of the present study indicated that listed companies in India have been disclosing the deferred tax accounting information as per AS 22 and Indian Accounting Standard (Ind.AS) 12-Income Taxes replaced AS 22 after the implementation of IFRS in India. Findings: The study revealed the fact that there exists a difference in the level of disclosure of deferred tax assets and deferred tax liabilities in the annual reports of listed companies in India. Practical Implication: The result of the study will facilitate an understanding of the concept and disclosure practice of deferred tax. Originality/Value: The study will enrich the domain knowledge through systematic financial statement analysis.
Article Details
Unique Paper ID: 166518

Publication Volume & Issue: Volume 4, Issue 12

Page(s): 374 - 379
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