Answered Questions

Date Submitted	06-Jul-10
Category	Financial Accounting & Reporting
Heading	DTA
Question	in the first para of this page, it says the standard specifies ...... will be available against which the DTD can be used? how do we know the taxable profit will be avalable which the DTD can be used? to my understanding that DTD means future deductions therefore more taxable income at presnet, does that mean if there is more taxable income then DTA can be recognised?
Answer	You can only recohnise an asset if it is probable that you will receive future benefit. In the case of DTA, you will only get the benefit if there is future assessable income against which to claim the DTDs or a liability for TTDs against which the DTDs can be offset. Whether it is probable that there will be future assessable income will a judgment based on past performance, future budgets, etc.