The 'Depreciation Capital-Allowance Transform' (D-CAT) Model: Decomposing the Divergence between Accounting Depreciation and Tax Depreciation

The Valuation Relevance of Reversing Deferred Tax Liabilities

The Accounting Review ◽

10.2308/accr.2004.79.2.437 ◽

2004 ◽

Vol 79 (2) ◽

pp. 437-451 ◽

Cited By ~ 24

Author(s):

David A. Guenther ◽

Richard C. Sansing

Keyword(s):

Discount Rate ◽

Firm Value ◽

Market Value ◽

Present Value ◽

Depreciation Rate ◽

The Future ◽

Deferred Tax Liabilities ◽

Deferred Tax ◽

Tax Depreciation ◽

Depreciation Methods

This paper compares two attributes of a deferred tax liability (DTL) that arise from differences in book and tax depreciation methods. The first attribute is the effect of the DTL on the market value of the firm. The second is the length of time between when the asset is placed into service and when the DTL associated with that asset begins to reverse. The paper shows that a decrease in the time it takes for the DTL to begin to reverse is neither necessary nor sufficient for the value of the DTL to increase. It also shows that the value of the DTL is not equal to the present value of the future deferred tax expense. The effect of one dollar of DTL on firm value depends only on the tax depreciation rate and the discount rate.

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Somatosensory Thalamic Activity Modulation by Posterior Insular Stimulation: Cues to Clinical Application Based on Comparison of Frequencies in a Cat Model

Neuromodulation Technology at the Neural Interface ◽

10.1111/ner.13343 ◽

2020 ◽

Author(s):

Hiba‐Douja Chehade ◽

Sandra Kobaïter‐Maarrawi ◽

Fares Komboz ◽

Jean‐Paul Farhat ◽

Michel Magnin ◽

...

Keyword(s):

Clinical Application ◽

Cat Model

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Intracranial pressure following resuscitation with albumin or saline in a cat model of meningitis*

Critical Care Medicine ◽

10.1097/ccm.0b013e3181fb7c94 ◽

2011 ◽

Vol 39 (1) ◽

pp. 135-140 ◽

Cited By ~ 10

Author(s):

Mårten Jungner ◽

Peter Bentzer ◽

Per-Olof Grände

Keyword(s):

Intracranial Pressure ◽

Cat Model

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COVID-19 and deferred tax reversals

Pacific Accounting Review ◽

10.1108/par-09-2020-0140 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Jilnaught Wong ◽

Norman Wong ◽

Willow Yangliu Li

Keyword(s):

New Zealand ◽

Financial Statement ◽

Public And Private ◽

Content Type ◽

Reversal Effect ◽

Tax Relief ◽

Deferred Tax Liabilities ◽

Deferred Tax ◽

Accounting Reports ◽

Tax Depreciation

Purpose This paper aims to examine the financial statement impact resulting from the tax depreciation on buildings that was reinstated on 25 March 2020 as part of the New Zealand Government’s coronavirus (COVID-19) tax support package. The COVID-19 pandemic and the tax relief created an accounting response to map the environment to accounting reports, reversing previously recognized deferred tax liabilities and increasing reported income as a result. Design/methodology/approach This is an exploratory and descriptive study to understand the accounting response and impact on companies’ financial statements following a COVID-19 tax relief to support businesses in a dire financial situation as the effects of COVID-19 took hold. Findings First, the accounting response provided the appropriate mapping from the COVID-19 environment to accounting reports. Second, the financial statement impacts are material, especially for companies with extensive holdings of buildings that are held for use. Third, while the accounting relief was immediate, the economic (cash flow) support does not occur until a year later. Research limitations/implications The financial statement impacts are based on a subset of NZX 50 companies with the available information at the time of writing. However, they do not compromise the external validity of the findings because the tax depreciation relief applies to other listed companies, unlisted public and private companies, trust, partnerships and individuals. Practical implications The New Zealand Government could have been more helpful to businesses by allowing an immediate depreciation deduction in the 2020 year as opposed to implementing it from 2021. Further, it could have legislated a backlog depreciation deduction from 2010 – when the depreciation on buildings was disallowed – to 2020. Originality/value This paper documents the evolution of the accounting for deferred taxes when the New Zealand Government withdrew the tax depreciation in 2010, how NZ IAS 12 evolved as a result of that event and now the reversal effect with the reinstatement of the tax depreciation during COVID-19. The paper also blends in the accounting responses and considers whether they are opportunistic or efficient.

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Explaining Underutilization of Tax Depreciation Deductions: Empirical Evidence from Norway

SSRN Electronic Journal ◽

10.2139/ssrn.976080 ◽

2003 ◽

Cited By ~ 2

Author(s):

Karl O. Aarbu ◽

Jeffrey K. MacKie-Mason

Keyword(s):

Empirical Evidence ◽

Tax Depreciation

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The impact of transition type on chromatic adaptation under dual lighting conditions

Color and Imaging Conference ◽

10.2352/issn.2169-2629.2020.28.7 ◽

2020 ◽

Vol 2020 (28) ◽

pp. 36-41

Author(s):

Shining Ma ◽

Peter Hanselaer ◽

Kees Teunissen ◽

Kevin A.G. Smet

Keyword(s):

Chromatic Adaptation ◽

Spatial Complexity ◽

Lighting Conditions ◽

Adaptation State ◽

Cat Model ◽

The Impact ◽

Transition Type

Over the years, many CATs (chromatic adaptation transform), typically based on the von Kries coefficient rule, have been developed to predict the corresponding colors under different illuminants. However, these CATs were derived for uniform stimuli surrounded by a uniform adapting field. To investigate the adaptation state under spatially complex illumination, an achromatic matching experiment was conducted under dual lighting conditions with three color pairs and two transition types. It has been found that the transition type has an impact on both the equivalent chromaticity and degree of adaptation. These results can help build a comprehensive von Kries based CAT model, with considering the spatial complexity of illumination.

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