Question 5 (4 Marks) Using the fundamental principle from paragraph 10 of IAS 12, explain why a deferred tax liability should be recognised in relation to the following scenarios. Development costs Development costs of $1000 that are recognised as an asset (i.e. capitalised) and will be amortised to the statement of PfL and OCI. The costs were deducted in determining taxable prot when they were incurred (i.e. when the cash was paid). Prepaid expenses Prepaid expenses (recognised as an asset for accounting purposes) of $ 1000 that have already been deducted in determining the taxable prot in the period in which they were paid