FAS 109 Accounting for Income Taxes
Accounting for income taxes under Financial Accounting Standard (FAS) 109 has become increasingly difficult due to complexities in tax law and expanded financial statement disclosure relating to income taxes. The impact of foreign tax credits, mergers and acquisitions and valuation allowance analysis are just a few of the complications that a company must consider in determining its current projected effective tax rate.
As a result of recent actions of the Public Company Accounting Oversight Board, auditors are placing more emphasis on income taxes and look to their clients to provide increasing amounts of analysis and documentation. What used to be a time-consuming annual exercise to prepare FAS 109 calculations and footnote disclosure is now becoming a quarterly event. In addition, the Financial Statement Accounting Board has recently issued a significant proposed interpretation under FAS 109, Accounting for Uncertain Tax Positions. This proposed interpretation will likely have a far-reaching impact on financial statement reporting.
Proper and timely preparation of a company’s quarterly and annual FAS 109 calculation, presentation and footnote disclosure requires personnel with strong technical skills in tax and financial areas. Many companies find themselves overburdened as they devote significant resources to Sarbanes-Oxley and other compliance requirements. Unfortunately, at a time company personnel need more assistance in the FAS 109 area, Sarbanes-Oxley further restricts the ability to utilize their audit firm’s personnel, including tax professionals.
Centerprise Group FAS 109 Services was formed to meet the demands of CFOs, controllers and tax directors by providing a full range of FAS 109 services. Centerprise Group professionals have extensive experience in FAS 109 compliance and consulting services. We are objective consultants who can interface with your tax and financial management and external auditors. Our team of professionals can free your staff to focus on tax planning and effective tax rate management rather than time-consuming calculations.
Centerprise Group FAS 109 service offerings include:
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FAS 109 Tax Rate Analysis – prepare all or selected calculations freeing your staff to focus on other priorities.
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Effective Tax Rate Analysis – calculate current and projected effective tax rate and related analysis.
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Mergers and Acquisition Due Diligence and Consultation – determine the impact on income taxes as a result of the target’s and combined entity’s tax attributes.
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Technical Advisory Consultations – assistance and advise on complex technical interpretations and the impact on your company.
Centerprise Group FAS 109 Services can support your compliance and planning efforts with a national network of FAS 109 professionals. You can rely on Centerprise Group professionals to provide tax and financial expertise to manage all of your FAS 109 needs.