Wuhan Corp. is a Vancouver-based company that engages in a large volume of international activities. The company had a largely independent wholly owned subsidiary in Hong Kong. Wuhan had been publicly traded on the TSX-V until mid-20X6, when a wealthy Vancouver tycoon purchased all of Wuhan’s outstanding shares through his private investment company. As Wuhan is no longer public but still needs to be audited, management decided to change its financial reporting from IFRS to Canadian ASPE effective in 20X6. Selected financial information (as reported under IFRS) is shown below (in thousands of Canadian dollars):

Wuhan’s management, with the consent of the new owner, has elected to change to the taxes payable method.

Required:
1. Explain the impacts that the change to ASPE will have on Wuhan’s restated comparative financial statements for 20X4 and 20X5.
2. Calculate the restated earnings for 20X4 and 20X5.

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Balances, 31 December: Retained earnings Deferred income tax liability OCI-accumulated translation gain (loss) OCI-accumulated pension remeasurement gain (loss) Year's translation gain (loss) on subsidiary (OCI) Year's actuarial gain (loss) on defined benefit pensions (OCI) Earnings for the year Dividends declared and paid during the year 20X3 $44,000 11,000 5,300 (8,000) (2,700) (1,500) 7,000 5,000 20X4 $45,000 8,000 6,800 (11,000) 1,500 (3,000) 7,500 5,000 20X5 $41,000 9,000 4,800 (9,600) (2,000) 1,400 2,000 6,000