Temporary differences schedule: Kiln subject to dismantling

Context

Valcrozet SA (a fictitious entity) manufactures technical ceramics. In 20X4, it leases a warehouse, brings into service a kiln subject to a dismantling obligation, acquires a licence, receives a grant, obtains control of Lantimar SAS (a fictitious entity) and issues a convertible bond. All entities are subject to the same taxation authority. For the 20X4 consolidated financial statements, you are preparing the deferred tax analysis of each transaction at the date of its initial recognition.

Assignment

Temporary differences schedule workpaper (lease, kiln, licence, grant, goodwill, convertible bond).

Purpose of the workpaper

For one statement of financial position item (asset or liability) of a taxable entity, determine the tax base and the taxable or deductible temporary difference, review the exceptions (goodwill, initial recognition, single transaction giving rise to equal differences), compute the gross deferred tax at the rate expected on reversal, then post the entries and pass the items on to the note.

Questions of the file covered by this workpaper

• Calculate the temporary differences arising on initial recognition (and that of goodwill at the reporting date).
• For each transaction, does a recognition exception apply? Give reasons.
• Calculate the deferred tax assets and liabilities, recognised or not.
• Calculate the net deferred tax of the two single transactions (lease, dismantling).
• Record the deferred tax entries for the lease, the kiln and the convertible bond.

• ContractWarehouse leaseOpen
• MemoTechnical memo on the kilnOpen
• InvoiceLicence invoiceOpen
• ExtractGrant award decreeOpen
• MemoConsolidation memoOpen
• ContractConvertible bond issue agreementOpen
• MemoTax department memoOpen
• InvoiceInsurance quote for the kilnOpen