Appendix A (INT23_07-17_COMPmar20_07-21)

This appendix is an integral part of AASB Interpretation 23 and has the same authority as the other parts of Interpretation 23.

In applying paragraph 13 of this Interpretation, an entity shall assess the relevance and effect of a change in facts and circumstances or of new information in the context of applicable tax laws. For example, a particular event might result in the reassessment of a judgement or estimate made for one tax treatment but not another, if those tax treatments are subject to different tax laws.

Examples of changes in facts and circumstances or new information that, depending on the circumstances, can result in the reassessment of a judgement or estimate required by this Interpretation include, but are not limited to, the following:

(a) examinations or actions by a taxation authority. For example:

(i) agreement or disagreement by the taxation authority with the tax treatment or a similar tax treatment used by the entity;

(ii) information that the taxation authority has agreed or disagreed with a similar tax treatment used by another entity; and

(iii) information about the amount received or paid to settle a similar tax treatment.

(b) changes in rules established by a taxation authority.

(c) the expiry of a taxation authority’s right to examine or re-examine a tax treatment.

The absence of agreement or disagreement by a taxation authority with a tax treatment, in isolation, is unlikely to constitute a change in facts and circumstances or new information that affects the judgements and estimates required by this Interpretation.

When there is uncertainty over income tax treatments, an entity shall determine whether to disclose:

(a) judgements made in determining taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates applying paragraph 122 of AASB 101 Presentation of Financial Statements; and

(b) information about the assumptions and estimates made in determining taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates applying paragraphs 125–129 of AASB 101.

If an entity concludes it is probable that a taxation authority will accept an uncertain tax treatment, the entity shall determine whether to disclose the potential effect of the uncertainty as a tax-related contingency applying paragraph 88 of AASB 112.