The International Accounting Standards Board (IASB) published on Tuesday 23 May amendments to accounting standard ‘IAS 12’, in accordance with the rules of the second pillar model issued by the Organisation for Economic Co-operation and Development (OECD). In April, the IASB confirmed its intention to amend this standard in order to avoid companies having to recognise deferred taxes resulting from the implementation of the Pillar Two model rules (see EUROPE 13160/16).
This temporary exception is intended to ensure consistency in the financial statements while easing into the implementation of the rules. Some targeted disclosure requirements are intended to help investors better understand a company’s exposure to income taxes arising from the reform, particularly before legislation implementing the rules is in place.
Companies can benefit from the temporary exception immediately but are required to provide the disclosures to investors for annual reporting periods beginning on or after 1 January 2023.
“A future maintenance project has been added to the pipeline, in which we will revisit the temporary exception and related disclosures”, explained Andreas Barckow, IASB chairman, in a statement. (Original version in French by Anne Damiani)