#ASC740 #SALT #Taxes
As noted in
ASC 740-10-30-21, other negative evidence may exist and should be considered when determining the need for, and amount of, a valuation allowance. Although the types of other negative evidence are fairly straightforward, it should be noted that an absence of those other forms of negative evidence is not considered positive evidence as described in
ASC 740-10-30-22. For example, if a company has not had net operating loss or tax credit carryforwards expire unused, it does not indicate positive evidence exists of a sufficient quality and quantity to obviate the need for a valuation allowance.
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Portfolio 5000-9th: Accounting for Income Taxes—FASB ASC 740, VI. Valuation Allowanced with the other positive and negative evidence available from the four sources of taxable income before concluding on the realizability of the deferred tax assets. b. Other negative evidence — <span>As noted in ASC 740-10-30-21, other negative evidence may exist and should be considered when determining the need for, and amount of, a valuation allowance. Although the types of other negative evidence are fairly straightforward, it should be noted that an absence of those other forms of negative evidence is not considered positive evidence as described in ASC 740-10-30-22. For example, if a company has not had net operating loss or tax credit carryforwards expire unused, it does not indicate positive evidence exists of a sufficient quality and quantity to obviate the need for a valuation allowance. 1. Going-concern opinion — If an auditor modified its opinion to state a substantial doubt exists about an entity's ability to continue as a going concern, we believe, for all practical Summary
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