HOLMES INSTITUTE FACULTY OF HIGHER EDUCATION Assessment Details and Submission Guidelines Trimester Unit Code Unit Title Assessment Type Assessment Title Purpose of the assessment (with ULO Mapping) Weight Total Marks Word limit Due Date Submission Guidelines T1 2020 HI5020 Corporate Accounting Individual Assignment Accounting for Income Tax This assignment aims at developing a clear understanding of students on corporate accounting for income tax issues. Students will develop an understanding on different concepts used in accounting for income tax. They will also develop an understanding on how different concepts of accounting for income tax are used by companies in the practical setting. (ULO 1, 2, 4, 5, 6). 40 % of the total assessments (Written assignment 30 % + Presentation 10 percent) Written assignment 30 marks + Presentation 10 marks 3000 words 500 words Assignment submission: Final Submission of individual Assignment: 11:59 pm Friday, Week 10 Late submission incurs penalties of five (5) % of the assessment value per calendar day unless an extension and/or special consideration has been granted by the lecturer prior to the assessment deadline. All work must be submitted on Blackboard by the due date along with a completed Assignment Cover Page. The assignment must be in MS Word format, no spacing, 12-pt Arial font and 2 cm margins on all four sides of your page with appropriate section headings and page numbers. Reference sources must be cited in the text of the report, and listed appropriately at the end in a reference list using Harvard referencing style. HI5020 Corporate Accounting Group Assignment T1 2020 Page 2 of 6 Assignment Specifications Purpose: This assignment aims at developing a clear understanding of students on corporate accounting for income tax issues. Students will develop an understanding on different concepts used in accounting for income taxes. They will also develop an understanding on how different concepts of accounting for income tax are used by companies in the practical setting. Assessment task: Collect the latest annual report of an ASX listed company for the last 2 financial years. Please read the financial statements (balance sheet, income statement, cash flow statement) and notes attached to financial statements on income tax issues very carefully. Please remember some aspects of your firm's treatment of its tax - can be a very complicated area, particularly for some firms. Based on your understanding of the topic \"accounting for income tax\" and based on your reading of the collected annual reports, do the following tasks. i Briefly explain the concepts of accounting profit, taxable profit, temporary difference, taxable temporary difference, deductible temporary difference, deferred tax assets and deferred tax liability. ii Briefly explain the recognition criteria of deferred tax assets and deferred tax liability. iii What is your firm's tax expense in its latest financial statements? iv Is this figure the same as the company tax rate times your firm's accounting income? Explain why this is, or is not, the case for your firm highlighting the reasons for differences. v Identify the deferred tax assets/liabilities that is reported in the balance sheet articulating the possible reasons why they have been recorded. vi Is there any current tax assets or income tax payable recorded by your company? Why is the income tax payable not the same as income tax expense? vii Is the income tax expense shown in the income statement same as the income tax paid shown in the cash flow statement? If not, why is the difference? viii Briefly explain the concepts of temporary difference and permanent difference. Identify any permanent differences that your company may have. ix What do you find interesting, confusing, surprising or difficult to understand about the treatment of tax in your firm's financial statements? What new insights, if any, have you gained about how companies account for income tax as a result of examining your firm's tax expense in its accounts? Assignment Structure should be as the following: Abstract - One paragraph List of Content Introduction Body of the assignment with detailed answer on each of the required tasks Summary/Conclusion List of references ..... HI5020 Corporate Accounting T1 2020 Page 3 of 6 Instruction for video presentation: Based on your written assignment you will have to make a summary video presentation ranging for 10 minutes. Your presentation should explain the assignment tasks and your key findings. You will have to upload the presentation in You Tube and submit the You Tube link in the black board so that the marker can watch and mark your presentation. Your assignment will be marked based on the following criteria: Excellent Very good Good Satisfactory Unsatisfactory Presentation marks) 3-2.5 2.5-1.75 1.75-1.5 1.5-1.00 1.00-0 Style (3 Content (4 marks) 4-3 3-2.5 2.5-2.00 2.00-1.00 1.00-0 Clarity of the presentation ((3 marks) 3-2.5 2.5-1.75 1.75-1.5 1.5-1.00 1.00-0 Marking criteria Marking criteria Abstract List of content & overall presentation of the assignment Introduction Briefly explain the concepts of accounting profit, taxable profit, temporary difference, taxable temporary difference, deductible temporary difference, deferred tax assets and deferred tax liability. Provide suitable example for each concept. Briefly explain the recognition criteria of deferred tax assets and deferred tax liability. What is your firm's tax expense in its latest financial statements? Is this figure the same as the company tax rate times your firm's accounting income? Explain why this is, or is not, the case for your firm highlighting the reasons for differences. Identify the deferred tax assets/liabilities that is reported in the balance sheet articulating the possible reasons why they have been recorded. Is there any current tax assets or income tax payable recorded by your company? Why is the income tax payable not the same as income tax expense? Is the income tax expense shown in the income statement same as the income tax paid shown in the cash flow statement? If not why is the difference? Briefly explain the concepts of temporary difference and permanent difference. Identify any permanent differences that your company may have. What do you find interesting, confusing, surprising or difficult to understand about the treatment of tax in your firm's financial statements? What new insights, if any, have you gained about how companies account for income tax as a result of examining your firm's tax expense in its accounts? Conclusion Total in Written Assignment Video presentation Total HI5020 Corporate Accounting T1 2020 Weighting 1% 1% 1% 7% 2% 1% 3% 3% 3% 3% 2% 2% 1% 30% 10% 40 % Page 4 of 6 Marking Rubric Excellent Very Good Good Satisfactory Unsatisfactory Briefly explain the concepts of accounting profit, taxable profit, temporary difference, taxable temporary difference, deductible temporary difference, deferred tax assets and deferred tax liability. /7 Briefly explain the recognition criteria of deferred tax assets and deferred tax liability. /2 All seven concepts have been discussed clearly and comprehensively . Suitable examples have been given All seven concepts have been discussed. Suitable examples have been given. Has discussed all seven concepts with examples. Minor errors remain. Attempted to discuss all seven concepts. Also attempted to provide examples. Major errors remain. Did not show an understanding of the concepts, did not provide appropriate examples. The recognition criteria of deferred tax assets and deferred tax liability have been correctly and comprehensively discussed The recognition criteria of deferred tax assets and deferred tax liability have been discussed. There is scope for improvement. The recognition criteria of deferred tax assets and deferred tax liabilities have been discussed with minor errors and ambiguity. The recognition criteria of deferred tax assets and deferred tax liabilities have been discussed with major errors and ambiguity. What is your firm's tax expense in its latest financial statements? /1 The income tax expense has been correctly identified ------ ------ The income tax expense has been incorrectly identified An attempt has been made to discuss the recognition criteria of deferred tax assets and deferred tax liability but the answer is mostly irrelevant, or an attempt has not been made to discuss the recognition criteria of deferred tax assets. The income tax expense has not been identified. HI5020 Corporate Accounting T1 2020 Page 5 of 6 Is this figure the same as the company tax rate times your firm's accounting income? Explain why this is, or is not, the case for your firm highlighting the reasons for differences. /3 Identify the deferred tax assets/liabilities that is reported in the balance sheet articulating the possible reasons why they have been recorded. /3 Demonstrated an excellent understanding of the issue. The reasons for the differences have been identified and explained Demonstrated a good understanding of the issue. The reasons for the differences have been identified and explained Demonstrated a poor understanding of the issue. The reasons for the differences have been identified and explained with minor errors Demonstrated a poor understanding of the issue. The reasons for the differences have been identified and explained with major errors Demonstrated very poor or no understanding of the issue. The reasons for the differences have not been identified and explained Has correctly identified the deferred tax assets and deferred tax liabilities reported by the company. The reasons for their origin have been identified and explained. Has correctly identified the deferred tax assets and deferred tax liabilities reported by the company. The reasons for their origin have been identified and explained with minor errors. Has clearly identified if the company has reported any current tax asset or income tax payable. Has demonstrated an excellent understanding of the reasons for the differences between income tax payable and income tax expense. Has clearly identified if the company has reported any current tax asset or income tax payable. Has demonstrated a good understanding of the reasons for the differences between income tax payable and income tax expense. Minor errors. Has identified the deferred tax assets and deferred tax liabilities reported by the company with major errors. The reasons for their origin have been identified and explained with major errors. Has identified if the company has reported any current tax asset or income tax payable. Has demonstrated a poor understanding of the reasons for the differences between income tax payable and income tax expense. Major errors. Has not identified the deferred tax assets and deferred tax liabilities reported by the company. The reasons for their origin have not been identified and explained. Is there any current tax assets or income tax payable recorded by your company? Why is the income tax payable not the same as income tax expense? /3 Has identified the deferred tax assets and deferred tax liabilities reported by the company with minor errors. The reasons for their origin have been identified and explained with major errors. Has identified if the company has reported any current tax asset or income tax payable. Has demonstrated a reasonable understanding of the reasons for the differences between income tax payable and income tax expense. Major errors. HI5020 Corporate Accounting T1 2020 Has not been able to identify if the company has reported any current tax asset or income tax payable. Unable to demonstrate an acceptable level of understanding of reasons for the differences between income tax payable and income tax expense. Major errors. Page 6 of 6 Is the income tax expense shown in the income statement same as the income tax paid shown in the cash flow statement? If not, why is the difference? /3 Has clearly identified if there is any difference between these two figures. Has demonstrated an excellent understanding on the reasons for the differences between these two figures. Has clearly identified if there is any difference between these two figures. Has demonstrated a good understanding on the reasons for the differences between these two figures. Has clearly identified if there is any difference between these two figures. Has discussed on the reasons for the differences between these two figures with minor errors Has attempted to explain if there is any difference between these two figures. Has discussed on the reasons for the differences between these two figures with major errors Briefly explain the concepts of temporary difference and permanent difference. Identify any permanent differences that your company may have. /2 Has shown an excellent understanding on the concepts of temporary difference and permanent difference. Has identified all permanent differences that the company might have. Has shown a good understanding on the concepts of temporary difference and permanent difference. Has identified all permanent differences that the company might have. What do you find interesting, confusing, surprising or difficult to understand about the treatment of tax in your firm's financial statements? What new insights, if any, have you gained about how companies account for income tax as a result of examining your firm's tax expense in its accounts? /2 Has provided an excellent synthesis of the discussions and analysis highlighting the reasons why the tax treatment can be complex. Has provided a very good synthesis of the discussions and analysis highlighting the reasons why the tax treatment can be complex. Has shown a basic understanding on the concepts of temporary difference and permanent difference. Has attempted to identify permanent differences that the company might have. Has provided good synthesis of the discussions and analysis highlighting the reasons why the tax treatment can be complex. Minor errors. Has attempted to explain the concepts of temporary difference and permanent difference, major errors remain. Has attempted to identify permanent differences that the company might have. Has provided a very basic synthesis of the discussions and analysis highlighting the reasons why the tax treatment can be complex. Major errors in the discussion. HI5020 Corporate Accounting T1 2020 Has not made any acceptable attempt to explain if there is any difference between these two figures. Has discussed on the reasons for the differences between these two figures with major errors Has not Explained the concepts of temporary difference and permanent difference. Has not attempted to identify permanent differences that the company might have. Has provided a very poor or no synthesis of the discussions and analysis highlighting the reasons why the tax treatment can be complex. Major errors in the discussion