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Statement of Financial Accounting Standards No. 109
FAS109 Status Page FAS109 Summary

Accounting for Income Taxes
February 1992

Financial Accounting Standards Board
of the Financial Accounting Foundation 401 MERRITT 7, P.O. BOX 5116, NORWALK, CONNECTICUT 06856-5116

Copyright © 1992 by Financial Accounting Standards Board. All rights reserved. No part of this publication may bereproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the Financial Accounting Standards Board.

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Statement of Financial Accounting Standards No. 109 Accounting for Income Taxes February 1992 CONTENTS Paragraph Numbers Introduction.................................................................................................................. 1–2 Standards of Financial Accounting and Reporting: Scope ...................................................................................................................... 3–5 Objectives and Basic Principles ........................................................................... 6–15 TemporaryDifferences................................................................................. 10–15 Recognition and Measurement........................................................................... 16–34 Annual Computation of Deferred Tax Liabilities and Assets ...................... 17–25 A Change in the Valuation Allowance............................................................... 26 AnEnacted Change in Tax Laws or Rates......................................................... 27 A Change in the Tax Status of an Enterprise ..................................................... 28 Regulated Enterprises......................................................................................... 29 Business Combinations...................................................................................... 30 Opinion 23 and U.S. Steamship Enterprise Temporary Differences............ 31–34 Intraperiod Tax Allocation ................................................................................. 35–39 Certain Quasi Reorganizations........................................................................... 39 Separate Financial Statements of aSubsidiary......................................................... 40 Financial Statement Presentation ....................................................................... 41–42 Financial Statement Disclosure.......................................................................... 43–49 Effective Date and Transition............................................................................. 50–59 Prior Business Combinations....................................................................... 53–56 Assets of Regulated Enterprises Reported on a Net-of-Tax or After-Tax Basis ...................................................................................... 57–59 Appendix A: Basis for Conclusions ...................................................................... 60–222 Appendix B: Application of the Standards toSpecific Aspects of Accounting for Income Taxes .......................................................... 223–276 Appendix C: Background Information................................................................ 277–285 Appendix D: Amendments to Existing Pronouncements.................................... 286–288 Appendix E: Glossary................................................................................................. 289

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FAS 109: Accounting for Income Taxes

FAS 109 Summary
This Statement establishes financial accounting and reporting standards for the effects of income taxes that result from an enterprise's activities during the current and preceding years. It requires an asset and liability approach for financial accounting and reporting for income taxes. This...