Case Study 2 Al Farsi S.A.O.G is one of the regional leaders and the largest producer of cement in Oman. it has been a major partner to the success of the city of Ibra and the development of the country. The company has brought life and growth to the local and surrounding communities. They promise quality in all products and solutions. In collaboration with many local and international partners, Al Farsi provides the expertise, focus, and resources required to efficiently deliver solutions to aid the growth of construction across the Middle East. With a robust maritime fleet, Al Farsi has expanded its reach to boost the development of businesses and communities from Southern Oman, Yemen, East Africa and the Indian Ocean. Now, with the high quality products, strong partnerships, rapid growth, and major acquisitions, Al Farsi is quickly establishing itself as a strategic partner for growth in the developing world. Al Farsi wanted your expert advice to determine the deferred tax asset and liabilities in the each of the below scenarios. Tax Rate is considered at 15% for all the scenarios. Scenario A Al Farsi S.A.O.G purchased a machine costing RO450000 million on 1-4-2018 with a estimated life of two years. The scrap value of the machine at the end of the life will be NIL. Straight line method of depreciation in the books of Al Farsi S.A.O.G whereas it is decided for tax purposes to depreciate fully in the first year. The net profit before depreciation and tax is considered as RO 750000. Scenario B Al Farsi S.A.O.G has recorded expenses which are accrued RO 175500 as per the financial books on 1st July 2019. The records of Al Farsi S.A.O.G has recorded RO 125000 which is deductible as part of the first year of the operations and RO 50500 as part of the second year of the operations. Scenario C On 1st April 2018Al Farsi S.A.O.G has pretax revenue of RO 1350000. Fixed assets purchased by the company amounting to RO 150000 and the fixed asset were depreciated with RO 60000 and as per the tax records the fixed asset was depreciated by 100%. Inventory was written down by 25000 to a net realizable value of RO 37500. Al Farsi S.A.OG had made a donation of RO 7550 and the same was deducted as expenses but disallowed by the income tax law.