IFRIC 23 (1): identifying an uncertain tax treatment and assessing its acceptance

A tax treatment is uncertain when its acceptance by the authority is uncertain. IFRIC 23 clarifies how to apply IAS 12 in that case: the entity first chooses the unit of account (single treatment or group of treatments) that best predicts the resolution; it assumes the authority will examine everything it has a right to examine, with full knowledge; then it assesses whether it is probable that the treatment will be accepted. If so, tax follows the return; if not, the effect of the uncertainty is reflected in the amounts.

In this lesson

1. 2Understand
2. 3The IFRS rule
3. 4Why?
4. 5How to apply it
5. 6Example
6. 7Key points
7. 8Exercises