a$.$ Explain the objectives of accounting for income taxes in general purpose financial statements. $$The primary objective is to accurately recognize the income tax obligations that a company incurs during a particular accounting period. This involves determining the current income tax expense, which is the tax liability based on the taxable income reported in the financial statements. $$Matching Principle: Another objective is to apply the matching principle, which ensures that expenses $($including income taxes$)$ are recognized in the same accounting period as the revenues they relate to$.$ By matching income tax expenses to the relevant revenues, financial statements provide a more accurate representation of the company's financial performance for the period.

b$.$ Explain the basic principles that are applied in accounting for income taxes at the date of the financial statements to meet the objectives discussed in $($a$).$ Accrual Accounting: Companies use accrual accounting, which means income taxes are recognized in the financial statements for the accounting period to which they relate, rather than when the tax payment is made. This ensures that tax expenses are matched with the corresponding revenues. Deferred Tax Accounting: The concept of deferred taxes is applied to account for temporary differences between the carrying amounts of assets and liabilities for accounting purposes and their tax bases. Temporary differences arise when the timing of recognition for accounting and tax purposes differs. Deferred tax assets and liabilities are recorded on the balance sheet to reflect these timing differences.$$Future Tax Rates: The tax effect on temporary differences is computed using the tax rates that are expected to apply in the periods when the deferred tax liabilities or assets are expected to be settled or realized. This requires an estimate of future tax rates, which may change over time.

c$.$ List the steps in the annual computation of deferred tax liabilities and assets.