Complete corporate income tax process at binh nam aluminum co ltd

Deferred tax liabilities are corporate income taxes that will be payable in the future based on taxable temporary differences for the current year, determined as follows: Deferred inco

BANKING ACADEMY ADVANCED PROGRAM FACULTY OF ACCOUNTING – AUDITING

-

GRADUATE THESIS COMPLETE CORPORATE INCOME TAX ACCOUNTING

PROCESS AT BINH NAM ALUMINUM CO LTD

Hanoi, May 2024

DECLARATION

I hereby declare that this thesis “Complete corporate income tax process at Binh Nam Aluminum Co Ltd” is my own work and has been conducted under the

guidance of Phd Nguyen Thanh Trung The research content and results presented

in this thesis are truthful and have not been previously published in any form The data in the tables used for analysis, commentary, and evaluation have been collected from various sources, all of which are clearly cited and referenced I take full

responsibility for the authenticity and originality of this thesis

Student

Pham Dieu Anh

ACKNOWLEDGEMENTS

First and foremost, I would like to express my deepest gratitude to my advisor, PhD Nguyen Thanh Trung, for their unwavering support, insightful advice, and valuable guidance throughout the course of this research Their mentorship has been invaluable, and I am immensely grateful for the time and effort they invested in helping me complete this work

I would also like to thank the Board of Directors of Binh Nam Group for giving me the opportunity to intern at the company, and to the staff in the accounting

department for their dedicated assistance throughout my internship and during the completion of this thesis

I am grateful to my colleagues and fellow students, who have provided me with a stimulating and enjoyable environment in which to learn and grow Their friendship and encouragement have made this journey more enjoyable and fulfilling

Thank you all for your support and encouragement

TABLE OF CONTENTS DECLARATION I TABLE OF CONTENTS III LIST OF ABBREVIATIONS V LIST OF FIGURES VI

INTRODUCTION 1

CHAPTER 1: THEORETICAL BASIS ON CORPORATION INCOME TAX ACCOUNTING 4

1.1 Theoretical basis on corporation income tax 4

1.1.1 Concept and characteristics of corporate income tax 4

1.1.2 Roles of corporate income tax 4

1.1.3 General contents of corporate income tax law in Vietnam 5

1.2 THEORETICAL BASIS ON CORPORATION INCOME TAX ACCOUNTING 13

1.2.1 Responsibilities of corporate income tax accountants 13

1.2.2 Corporate income tax accounting in accordance with international accounting standards 14

1.2.3 Corporate income tax accounting according to Vietnamese accounting standards 17 CHAPTER 2: CORPORATION TAX ACCOUNTING PROCESS IN BINH NAM ALUMINUM CO LTD 37

2.1 Company overview 37

2.1.1 Characteristics of the company's business organization 37

2.2.2 Company’s accounting policy 40

3.3 Corporate income tax accounting process in Binh Nam Aluminum Co Ltd 41

3.3.1 Characteristics of Binh Nam Co Ltd corporate income tax 41

3.3.2 Documents and accounts used 43

3.3.3 Corporate income tax accounting process at Binh Nam Aluminum Co Ltd 43 3.4 General assessments on corporate income tax accounting at Binh Nam Aluminum Co Ltd 54

3.4.1 Advantages 54

3.4.2 Limitations 56

CHAPTER 3: SOLUTIONS TO IMPROVE CORPORATE INCOME TAX

ACCOUNTING AT BINH NAM ALUMINUM CO LTD 59

3.1 Development orientation of binh nam aluminum company limited in the future time 59

3.2 Objectives and solutions to improve corporate income tax accounting at the company 59

3.2.1 The goal of improving corporate income tax accounting 60

3.2.2 Solutions 61

3.2.3 About the accounting document system 62

3.2.4 Potential risks in the process of approving financial transactions in corporate income tax accounting 63

3.3.5 Regarding the company's business development and expansion goals in 2024 and the coming years 64

CONCLUSION 67

LIST OF ABBREVIATIONS

Standards

LIST OF FIGURES

Table 3.1 Genaral Ledger 48

Table 3.2 Extract detailed ledger account 8211 - Current corporate income tax expense 48

Table 3.3 Extract detailed ledger account 3334 – Corporate income tax 48

Table 3.4 Excerpt from financial statement notes in 2023 49

Picture 3.1 Screenshot of preparing tax declaration 50

Picture 3.2 Extract corporate income tax declaration 52

Chart 1.1: Current corporate income tax expense accounting 30

Chart 1.2: “Deferred corporate income tax” accounting 31

Chart 2.1 Binh Nam Aluminum Co Ltd management structure chart 38

Chart 2.2 Binh Nam Aluminum Co Ltd accounting department structure chart 38

INTRODUCTION The urgency of the subject

Since transitioning from a centrally planned economy to a market economy following the 6th National Congress of the Communist Party in 1986, Vietnam’s economy has become increasingly diverse in terms of activity types, organizational scale, ownership structures, and economic activities Moreover, the country is becoming more deeply integrated into regional and global economies, as evidenced

by its membership in numerous economic and trade organizations, such as the WTO, AFTA, and APEC, and through the signing of trade agreements, which have opened up significant opportunities for economic growth while simultaneously presenting a range of new challenges In this increasingly competitive environment, accounting, as an important economic management tool for businesses, must adhere

to tax law regulations while also safeguarding the interests of enterprises

While accounting serves as an effective economic management tool for businesses, tax policy is utilized as a principal instrument by the government for macroeconomic management and regulation Among the taxes enacted by the National Assembly, corporate income tax (CIT) is one that garners significant attention from both the state and enterprises

"Tax is a major revenue source for the state budget, establishing social equity and equality among economic sectors and social classes."

Tax ensures revenue for the state budget, meeting the state's expenditure needs, redistributing income and assets to ensure social equity, and regulating the macroeconomy Paying tax according to the law is the duty and right of all organizations and individuals engaged in relevant activities, requiring them to transfer a portion of their income or assets to the state

For businesses, tax, especially corporate income tax, is extremely important because

it is an obligation that businesses must fulfill Tax greatly affects the profitability of each enterprise Therefore, tax accounting in general, and corporate income tax accounting in particular, are essential for businesses, helping them accurately determine the tax amount payable, fulfill their obligations to the state budget, and determine the tax amounts refundable or exempt, thus ensuring the rights of

enterprises

In the context of economic integration, issues related to tax and corporate income tax accounting are of particular concern for the government in fostering enterprise development The Ministry of Finance has issued numerous circulars and decrees to adjust and supplement corporate income tax policies Accurately understanding and determining corporate income tax obligations for organizations and companies is extremely important Understanding the importance of corporate income tax and corporate income tax accounting, I have chosen the topic "Improving the Corporate Income Tax Accounting Process at Binh Nam Aluminum Co., Ltd." as the subject

of my graduation thesis

Research overview

Through recent investigation, I have observed that research topics related to this theme predominantly focus on tax accounting for specific clusters of enterprises or particular regions Some notable research includes:

- "Improving corporate income tax accounting for small and medium-sized enterprises in the construction sector in Thanh Xuan District, Hanoi" – 2020 Economics thesis by Bui Thi Thoa

- "Improving corporate income tax in Vietnam today" – 2019 Doctoral dissertation

by Le Thi Minh Phuong

Due to the frequent changes in tax laws to align with the state's policy direction in each period, the practical relevance of these research topics is no longer suited to current conditions Moreover, the solutions proposed in these studies are often unrealistic, idealized, and not practically applicable in the actual operations of enterprises Additionally, these solutions primarily aim at refining the application of accounting standards in enterprise accounting without comprehensively studying the improvement of accounting methods Therefore, identifying basic, comprehensive, and feasible solutions to enhance the effectiveness of corporate income tax accounting is extremely necessary, including the development of models that can be practically applied in the management activities of manufacturing and processing enterprises in general, and specifically at Binh Nam Aluminum Co Ltd

Aim of the study

- Present an overview of general theories on corporate income tax accounting

- Reflect the reality of corporate income tax accounting at Binh Nam Aluminum Company Limited

- Provide assessments and comments on the corporate income tax accounting system at the company, thereby proposing solutions to help the company improve and overcome limitations

Research object and scope

This thesis investigates several theoretical issues related to corporate income tax accounting, examines the current state of corporate income tax accounting as applied at Binh Nam Aluminum Co., Ltd., and proposes solutions for enhancing corporate income tax accounting from the perspective of organizational implementation at the studied enterprise

Research methodology

The research methodology combines theoretical study with practical surveys and summaries, utilizing a comprehensive set of analytical, synthetic, and comparative methods This approach is employed to both study the results and propose solutions for improvement

Thesis structure

In addition to the introduction, conclusion, table of contents, list of abbreviations, list of charts and tables, list of references, and appendices, the thesis is structured as follows:

Chapter 1: Theoretical Framework of Corporate Income Tax Accounting

Chapter 2: Current State of Corporate Income Tax Accounting at Binh Nam Aluminum Co., Ltd

Chapter 3: Solutions for Enhancing Corporate Income Tax Accounting at Binh Nam Aluminum Co., Ltd

CHAPTER 1: THEORETICAL BASIS ON CORPORATION INCOME TAX

ACCOUNTING 1.1 Theoretical basis on corporation income tax

1.1.1 Concept and characteristics of corporate income tax

Throughout human history, taxes have been intrinsically linked to the emergence, existence, and development of the state, stemming from the need for financial resources in the process of the state fulfilling its functions and duties Taxes have become a crucial tool in mobilizing budgetary revenues Corporate income tax has been applied for a long time in many countries around the world under various names such as corporate income tax, company tax, etc Since the late nineteenth century, some countries, earliest among them being the UK and Japan, have implemented corporate income tax By the early twentieth century, France and China had also adopted this tax

The corporate income tax possesses the following characteristics:

Firstly, corporate income tax is a direct tax, and taxpayers include enterprises and investors from various economic sectors who generate profits, simultaneously serving as tax bearers

Secondly, corporate income tax is contingent upon the results of business activities conducted by enterprises It is determined based on taxable income, therefore only profitable enterprises and business investors are liable to pay corporate income tax

1.1.2 Roles of corporate income tax

Corporate income tax serves several functions, including the following:

Firstly, CIT is a significant source of budget revenue and tends to increase in line

with the growth of the national economy In the context of an increasingly developing economy, the ability to mobilize financial resources for the state budget through CIT is expanding, by encompassing a majority of income sources arising from various more complex income structures Similar to other tax regimes, CIT ensures a large and stable revenue stream for the budget

Secondly, CIT is utilized as a pivotal instrument to serve the objective of economic

restructuring Through specifying tax subjects, tax payers, tax rates, and CIT incentives, the government formulates rational tax incentive policies to stimulate the

development of particular industries or regions requiring substantial investment The government may also implement higher taxation measures, reduce exemptions, and grant tax reductions for industries necessitating production contraction Furthermore, to incentivize investment in specific sectors, products, or regions where the state aims to bolster production, exploit domestic capital potential, and attract foreign investors, as well as to assist enterprises in overcoming obstacles, the government can employ various degrees of tax exemptions, reductions, tailored to individual entities

Thirdly, CIT is particularly important in addressing economic disparities and

enhancing social equity CIT applies to all types of businesses With a uniform tax rate, larger and more profitable corporations bear a proportionately greater tax burden, thereby contributing more significantly to the public coffers and lessening the financial burden on lower-income groups Socially, this redistribution plays a crucial role in leveling the playing field, providing greater opportunities for all sectors of society through enhanced public services and infrastructure, which are funded by tax revenues

1.1.3 General contents of corporate income tax law in Vietnam

1.1.3.1 Characteristics and roles of corporation income tax in Vietnam

In Vietnam, corporate income tax originates from profit tax, which is a portion of profits earmarked for taxation The first corporate income tax law in Vietnam was passed by the National Assembly of the Socialist Republic of Vietnam on May 10,

1997, and took effect on January 1, 1999, replacing the Profit Tax Law Currently, corporate income tax in Vietnam is regulated by the Law on Corporate Income Tax

No 14/2008/QH12 dated June 3, 2008, and its amending and supplementing laws

No 32/2013/QH13 dated June 19, 2013, and No 71/2014/QH13 dated November

26, 2014, along with guiding documents such as Circular No 78/2014/TT-BTC dated June 18, 2014, Circular No 96/2015/TT-BTC dated June 22, 2015, and other related decrees and circulars

Corporate income tax is a crucial source of state budget revenue, given its extensive regulatory scope, encompassing all profit-making entities within the territory of Vietnam As the market economy continues to develop and integration processes

unfold across all sectors of the economy, the ability to mobilize financial resources for the state budget through corporate income tax increases significantly The proportion of corporate income tax (CIT) in Vietnam's total state budget revenue has been significant over the years For 2021, the total state budget revenue was estimated at approximately VND 1,343 trillion, with corporate income tax contributing a substantial portion of this revenue By 2023, the total state budget revenue was projected to be VND 1,620,744 billion, indicating a growth in overall revenue collection, which includes contributions from CIT among other sources Although the exact percentages of CIT within these total revenues are not detailed

in the sources, it's clear that corporate income tax remains a critical component of Vietnam's fiscal strategy, reflecting its importance in funding state expenditures and development initiatives These figures highlight the role of CIT in supporting Vietnam's budget needs, particularly in a dynamic economic environment

Corporate income tax plays a significant role in Vietnam's tax legal system This tax

is one of the tools that helps the government regulate economic and social activities and redistribute income, ensuring social equity through tax incentive policies for industries and economic regions listed as priorities for development, thereby avoiding imbalances in the national economy

1.1.3.2 Corporate income tax payers

According to the 2008 Corporation Income Tax Law and its 2013 amendment, entities liable for corporation income tax are delineated as "organizations engaged

in productive activities, commercial transactions involving goods, and service provision, which yield taxable revenue." These encompass:

- Domestic enterprises constituted in accordance with Vietnamese legislation, embracing joint-stock companies, limited liability companies, partnership entities, and diverse forms of enterprises established and operating pursuant to Vietnam's Enterprise Law

- Enterprises with foreign capital investment, comprising joint ventures, wholly foreign-owned entities, and alternative modes of foreign investment within Vietnam

- Other economic organizations, including non-enterprise economic organizations

like cooperatives, collaborative associations, and operational units engaged in production and commerce

- Foreign organizations' business establishments within Vietnam, exemplified by representative offices or branches of overseas corporations, are obligated to remit enterprise income tax on profits accrued within Vietnam

Each category of enterprise must comply with regulations pertaining to business registration, financial oversight, and tax remittance stipulated under Vietnamese law

1.1.3.3 General principles for determining corporate income tax

According to current regulations, the corporate income tax period is determined according to the fiscal year The basis for calculating corporate income tax payable

is taxable income and tax rate in the taxable fiscal year and is determined as follows:

Taxable income

Taxable income in the tax period is determined as follows:

In particular, taxable income in the tax period includes income from production and trading of goods and services and other income, which is determined as follows:

- Revenue used to determine taxable income encompasses the entirety of proceeds from the sale of goods, processing fees, and service provision, inclusive of subsidies, surcharges, and additional fees received by the enterprise, regardless of whether the funds have been collected or not Revenue considered for taxable income calculation excludes trade discounts, discounts, and returned goods Enterprises engaged in multiple business activities subject to different tax rates must separately calculate the income from each activity multiplied by the corresponding tax rate

- Expenses eligible for deduction: Enterprises are allowed to deduct all expenses if

Corporation income

tax payable = Taxable income _- Science and technology fund appropriation (if any) x

Corporation income tax rate

Taxed income = (Revenue - Deductible expenses) + Other income

they meet the prescribed conditions and are not among the expenses ineligible for deduction when determining taxable income

Deductible expenses include those that meet the following conditions:

(1) Actual expenses incurred related to the production and business activities of the enterprise

(2) Expenses supported by adequate invoices and legal documents as required by law

(3) Expenses for which invoices for the purchase of goods or services, each valued

at 20 million dong or more (including VAT), must have non-cash payment receipts when payment is made

Expenses not eligible for deduction when determining taxable income include:

(1) Expenses that do not meet the conditions for deductible expenses, except for losses due to natural disasters, epidemics, and other force majeure events not compensated for

(2) Fines for administrative violations

(3) Expenses compensated from other funding sources

(4) The portion of business management expenses allocated by foreign enterprises

to their permanent establishments in Vietnam exceeds the amount calculated according to the allocation method prescribed by Vietnamese law

(5) Expenditure exceeding the prescribed norms for consumption of raw materials, materials, fuels, energy, and goods for certain raw materials, materials, fuels, energy, and goods as determined by the state

(6) Interest expense on loans for production and business activities of entities other than credit institutions or economic organizations exceeding 150% of the basic interest rate announced by the State Bank of Vietnam at the time of borrowing (7) Incorrect depreciation of fixed assets as prescribed by law

(8) Prepaid expenses for the term, for the period until the end of the term, periods not yet incurred, or unspent periods

(9) Salaries, wages of individual business owners, remuneration paid to business founders who do not directly participate in production and business management; salaries, wages, other payments to employees but not actually paid or lacking

invoices and documents as required by law

(10) Repayment of interest on loans corresponding to the deficient charter capital (11) Input VAT already deducted, VAT paid by the deduction method, corporate income tax

(12) Sponsorship expenses not compliant with legal regulations or lacking documentation as required

(13) Other non-deductible expenses

- Other income: Other income refers to items as stipulated in the current corporate income tax guidance documents in Vietnam, which encompass 23 income categories

Some fundamental sources of other income include:

(1) Income from capital transfer, securities transfer

(2) Income from real estate transfer; investment project transfer; transfer of participation rights in investment projects; transfer of exploration, exploitation, and processing rights of minerals as regulated by law

(3) Income from ownership rights, asset use rights, including royalties paid for ownership rights, asset use rights; income from intellectual property ownership rights transferred through technology transfer as regulated by law

(4) Income from leasing assets in all forms

(5) Income from asset transfer, asset liquidation (excluding real estate), and various types of valuable documents

(6) Income from interest on deposits, interest on capital loans, including late interest payments, installment interest, credit guarantee fees, and other fees in loan agreements

(7) Income from scrap and residue consumption after deducting recovery and consumption costs

(8) Refund of export tax, import tax on goods actually exported, imported during the tax year of corporate income tax settlement is deducted as expenses in that year's settlement In cases where the refund of export, import taxes on goods that have been actually exported, imported occurs in years preceding the corporate income tax settlement, it is counted as other income in the year when the income

arises

(9) Income from activities of contributing capital to domestic joint-stock companies, joint ventures, domestic economic associations, which are distributed from income before corporate income tax

 Tax rates and corporate income tax incentives:

The corporate income tax rate is determined based on the provisions of the Corporate Income Tax Law 2008 (amended and supplemented in 2013, 2014, 2020,

2022, and 2023) - hereinafter referred to as the Corporate Income Tax Law

According to Article 10 of the Corporate Income Tax Law, the corporate income tax rate is 20%, except for enterprises subject to tax rates ranging from 32% to 50%

as specified in sections 1.2 and 1.3 For enterprises established and operating under Vietnamese law, including cooperatives, production and business units with total annual revenue not exceeding 20 billion Vietnamese dong, a tax rate of 20% applies

As stipulated in section 3 of Article 10 of the Corporate Income Tax Law and section 3 of Article 10 of Decree 218/2013/NĐ-CP, the corporate income tax rate for activities related to exploration, prospecting, and exploitation of rare natural resources in Vietnam ranges from 32% to 50%, depending on each project and business establishment

According to section 3 of Article 10 of the Corporate Income Tax Law (amended by Article 1 of the Petroleum Law 2022, effective from July 1, 2023), the corporate income tax rate for petroleum activities ranges from 25% to 50%, depending on each petroleum contract

The government also issues various tax incentive policies, including preferential tax rates applicable from the first year of revenue generation for enterprises, and exemptions or reductions in taxes applicable from the first year of taxable income or from the fourth year of revenue generation if no taxable income is generated within the first three years, for enterprises implementing accounting and tax declaration regimes Current tax incentives primarily target projects in especially difficult areas, economic zones, projects investing in science and technology development, software production, improved materials; large-scale projects employing a

significant workforce and enterprises operating in socialized sectors (education, healthcare )

1.1.3.4 Procedures for filing, paying, and finalizing corporate income tax

 Filing corporate income tax

The company must submit its corporate income tax filing to the tax authority that directly manages it

In cases where a company has dependent subsidiaries that use centralized accounting, the dependent subsidiary is not required to file a corporate income tax return When filing, the company should include all taxable income, including that generated by the dependent subsidiary, in its filing at its headquarters

In cases where a company has independent subsidiaries that manage their own accounts, the subsidiary is required to file a corporate income tax return with the tax authority directly managing the subsidiary

In cases where a company has manufacturing facilities (including processing and assembly facilities) that use centralized accounting and are located in provinces or centrally governed cities different from where the headquarters is located, the company should file a consolidated return that includes both the income generated

at the headquarters and that at the manufacturing facility

Economic groups and parent corporations with dependent member units that can account for revenue, expenses, and taxable income should ensure that the member unit files a corporate income tax return with the tax authority that directly manages the unit

In cases where the member unit engages in business activities different from the group or corporation and accounts separately for income from such activities, the member unit should file a corporate income tax return with the tax authority that directly manages the unit

 Paying corporate income tax

Business entities must make quarterly tax payments based on their corporate income tax declarations or as determined by the tax authority, fully and on time, into the state budget, no later than the last day of the final month of the quarter The determination of the tax payment date for the business entity is as follows:

+ For cash payments: The tax payment date for business entities paying in cash is the date the state treasury receives the payment or the date the tax authority issues a tax receipt

+ For payments via bank transfer: The tax payment date for business entities paying through bank transfer or other financial institutions is the date the bank or financial institution signs and acknowledges the payment to the state budget

 Corporate income tax finalization

Corporate income tax finalization involves fully determining a business entity's obligations for a fiscal year with the state budget The tax finalization declaration encompasses the annual corporate income tax finalization or the corporate income tax finalization up to the time of cessation of business activities, termination of a contract, change of ownership structure, or corporate reorganization

The deadline for submitting the corporate income tax finalization is no later than the 90th day from the end of the calendar or fiscal year

According to current tax management regulations, businesses must self-assess, declare, and pay taxes, and are responsible for the accuracy and honesty of their tax calculations and declarations

The annual tax finalization is also self-prepared and self-assessed by the business entity

The tax authority's review of the corporate income tax finalization aims to verify whether the business entity’s tax finalization is accurate and if it has properly determined and paid the tax due to the state

If the tax authority's review identifies inaccuracies in the business entity’s tax declaration or corporate income tax finalization, penalties will be imposed according to the law

Key documents in corporate income tax finalization fillings include these followings:

+ Corporate income tax finalization declaration

+ A set of financial reports as prescribed by accounting law, including the balance sheet, income statement, cash flow statement, and accompanying notes

+ Additional schedules as applicable to the specific circumstances, which may

include business performance schedule, loss carryforward schedule, corporate income tax incentives schedule and other related party transactions schedule.

1.2 THEORETICAL BASIS ON CORPORATION INCOME TAX ACCOUNTING

1.2.1 Responsibilities of corporate income tax accountants

Originating from the goal of providing information to users, accountants generally have several tasks:

+ Income collection, processing information, accounting data by object and content

of accounting work, according to accounting standards and regulations

+ Checking, supervising financial revenues and expenditures, obligations to collect, remit, and pay debts; inspecting the management and use of assets and the sources

of asset formation; detecting and preventing financial and accounting violations + Analyzing accounting information and data; advising, proposing solutions to serve the management requirements and economic, financial decisions of the accounting unit

+ Providing accounting information and data as prescribed by law

In addition, accountants must also determine tax obligations to meet the management requirements of the tax authorities, resulting in the need to establish tax accounting

Corporate income tax accounting involves accounting for transactions influenced by corporate income tax in the current year and in the future, regarding the recovery or settlement in the future of the book value of assets or liabilities recognized in the balance sheet and other transactions, events recorded in the current year's financial statements

Some tasks of corporate income tax accountants include:

+ Estimating corporate income tax and planning appropriate taxes based on the conditions of each business

+ Accounting for revenue and expenses in accordance with legal regulations

+ Compiling tax files and submitting taxes in accordance with tax management laws

+ Explaining the basis for preparing tax returns and required tax settlement reports

1.2.2 Corporate income tax accounting in accordance with international accounting standards

The International Accounting Standards (IAS) are developed by the International Accounting Standards Board (IASB) with the aim of achieving consistency in financial reporting among organizations and between national accounting standards and international financial reporting standards The International Accounting Standard for Income Taxes IAS 12 is one such standard issued by the IASB in July

1979 and has been continuously revised and updated since then, being flexibly applied by many countries

In essence, IAS 12 guides the accounting treatment of transactions affected by corporate income taxes and presents related content in financial statements However, due to differences between accounting and tax laws, the actual profit used

to determine corporate income taxes payable (taxable income) often differs from the profit reported in the financial statements for the period (accounting profit)

The concept of accounting profit and taxable income as mentioned in the standard is

as follows:

- Accounting profit: It refers to the profit or loss of a period, before deducting corporate income taxes, determined in accordance with accounting standards and accounting principles

- Taxable income: It is the income subject to corporate income tax for a period, determined in accordance with the current Corporate Income Tax Law and serves as the basis for calculating corporate income tax payable (or recoverable)

At the time of its issuance, IAS 12 allowed for deferred tax accounting in corporate taxation using either the deferred method or the liability method However, currently, IAS 12 mandates the use of a single method for accounting for corporate income tax, which is the liability method Although stemming from accounting profit, IAS 12 does not approach corporate income tax based on reported business results because, in essence, corporate income tax depends on taxable income for the period, which is the result of revenue minus expenses and is reflected through the increase in equity at the end of the period compared to the beginning of the period (excluding additional capital injections and no capital reductions) This fluctuation

is also reflected in changes in assets and liabilities Therefore, the values of assets

along with liabilities all affect taxable income and corporate income tax IAS 12

defines the tax base of assets and liabilities as follows :

"The tax base of an asset is the amount that will be deductible for tax purposes

against any taxable economic benefits that will flow to an entity when it recovers

the carrying amount of the asset

The tax base of a liability is its carrying amount, less any amount that will be

deductible for tax purposes in respect of that liability in future periods."

To determine the taxable base of an asset or liability, a business needs to consider

factors such as the taxable income value when the asset is recovered or the

deductible expense value from taxable income when the liability is settled; the value

of income excluded from taxable income or the value still deductible in determining

taxable income in the future When a business recognizes an asset or liability in the

financial statements, it must anticipate a recovery or settlement of the carrying value

of that asset or liability, often resulting in a discrepancy when determining corporate

income tax IAS 12 addresses several discrepancies, such as assets being revalued

and not adjusted for tax purposes, or assets and liabilities in business combinations

being recognized at fair value but without a corresponding adjustment for tax

purposes Furthermore, IAS 12 introduces the concept of temporary differences as

follows:

"Temporary differences are discrepancies arising from the timing difference

between the recognition of income or expenses by the enterprise and the timing

prescribed by tax law for recognizing taxable income or deductible expenses Over

time, temporary differences will be fully deducted from expenses and income."

Temporary differences include deductible temporary differences and taxable

temporary differences These discrepancies lead to the creation of deferred tax

assets or liabilities in the future

Deferred tax liabilities are corporate income taxes that will be payable in the future

based on taxable temporary differences for the current year, determined as follows:

Deferred

income tax payable = Total taxable temporary difference during the year x Income tax rate according to current regulations

Deferred tax liabilities are recognized for all taxable temporary differences, except

for deferred tax liabilities arising from the recognition of assets or liabilities in a

transaction that does not affect profit at the time of occurrence, or from the

recognition of goodwill, installment payments by the business, but which are not

allowed as a tax deduction against taxable income

Deferred tax assets are income taxes that will be refunded in the future based on

deductible temporary differences, carry-forward amounts of tax losses, and unused

tax credits, determined as follows:

Deferred tax assets arising from these deductible temporary differences, tax losses,

and unused tax credits are only recognized when it is probable that sufficient

taxable profits will be available in the future to utilize these amounts

Corporate income tax expense (or income tax income) is the aggregate of current

income tax expense (or income) and deferred income tax expense when determining

the profit or loss for a period

Current income tax is the corporate income tax payable or refundable, calculated on

taxable income and the current corporate income tax rate Deferred income tax is

recognized as either income or expense in the income statement, except when it

arises from a transaction or event directly recognized in equity In parallel with the

recognition of deferred tax assets and deferred tax liabilities, the principle of

offsetting applies between the amounts incurred in the year and those recognized

from prior years but now reversed IAS 12 mandates the recognition of deferred tax

expense to determine the operating results for the year in cases where deferred tax

liabilities arise, except when they result from transactions directly recognized in

equity, such as retrospective adjustments to the opening balance of retained

earnings due to changes in accounting policy or foreign currency translation

differences from converting the financial statements of foreign operations…

Deferred tax assets =

( Total deductible temporary difference + Deductible value of unused tax losses and incentives during the year

Income tax rate according

to current regulations

x

1.2.3 Corporate income tax accounting according to Vietnamese accounting standards

1.2.3.1 Corporate income tax accounting methods

Documents used in corporate income tax accounting

Since corporate income tax is only determined after the process of establishing the business results has been completed, the documents used in corporate income tax accounting include all accounting documents arising during the accounting process for other accounting entities within the enterprise, which include:

+ Sales invoices, value-added tax invoices, specialized invoices, receipts,

+ Export-import documentation (commercial invoices, customs declarations)

+ Salary and wage documentation (payroll records, attendance sheets, insurance notifications, bonus decisions)

+ Inventory and asset documentation (internal goods issue vouchers, internal goods receipt vouchers, fixed asset documentation)

+ Corporate income tax documentation (corporate income tax return forms, payment receipts to the state budget…)

For deferred corporate income tax accounting, at the end of the fiscal year, accountants must prepare a "Temporary Deductible Differences Statement" and an

"Unused Temporary Deductible Differences Tracking Statement." These documents determine the value of deductible carryforwards for tax losses and unused tax credits Subsequently, these are used as a basis to prepare a "Deferred Tax Asset Statement" to determine and recognize the value of deferred tax assets to be recorded or reversed during the year (if any) Additionally, a "Taxable Temporary Differences Statement" serves as a basis for preparing a "Deferred Tax Liability Statement" to recognize deferred tax liabilities arising from transactions during the year, which are then recorded as deferred corporate income tax expenses

Accounts – Accounting books used and corporate income tax accounting process

To reflect each type of tax as stipulated by tax law and to cater to the need for tax control over the processes occurring in business activities, relevant accounts are appropriately defined The accounts related to the accounting of corporate income tax include:

Account Number Account Title

Level 1 Level 2

333 Taxes and amounts payable to the state

3334 CIT

347 Deferred corporate income tax liability

821 8211 Current corporate income tax expense

8212 Deferred corporate income tax expense

- Account 243 - “Deferred tax asset”:

Structure and content of the account :

Value of deferred tax assets

remaining at the end of the period

- Account 347 - “Deferred corporate income tax payable”

The structure and content reflect:

- Deferred income tax payable is reduced

(returned) during the period

- Deferred tax liabilities are recognized during the period

Credit balance:

Deferred income tax payable

remaining at the end of the period

- Account 3334 - “Corporate income tax”

Content: Reflects the amount of corporate income tax payable, paid and remaining payable to the state budget

Account structure:

- The amount of corporate income tax

paid to the state budget

- The difference between the

temporarily paid tax amount is greater

than the actual tax amount payable

according to final settlement

- The amount of corporate income tax that must be paid to the state budget

Debit balance:

The amount of corporate income tax

overpaid to the state budget

Credit balance:

The remaining corporate income tax amount must be paid to the state budget

- Account 8211 - “Current corporate income tax expenses”

Content: Reflects current corporate income tax expenses incurred during the year of the enterprise

Account structure:

- Corporate income tax payable is

included in current corporate income tax

expenses arising during the year;

- Additional corporate income tax of

previous years that must be paid due to

the discovery of non-material errors in

previous years is recorded as an increase

in the current corporate income tax

- The actual current corporate income tax amount payable during the year is less than the temporary corporate income tax amount payable and is deducted from the current corporate income tax expense recorded during the year;

- The amount of corporate income tax

expense of the current year payable recorded as a decrease due to

the discovery of immaterial errors in previous years is recorded as a decrease

in corporate income tax expense in the current year;

- Transfer current corporate income tax expenses to the debit side of account

911 - "Determination of business results"

There is no ending balance

- Account 8212 - “Deferred corporate income tax expenses”

Structure and content of the account:

- Deferred corporate income tax expense

arising during the year from the

recognition of deferred income tax

liabilities (the difference between

deferred income tax payable arising

during the year is greater than deferred

income tax payable reversed during the

year);

- The amount of reversal of deferred

corporate income tax assets recorded

from previous years (is the difference

between the deferred income tax assets

reversed during the year and the deferred

income tax assets arising during the year)

);

- Carry forward the difference between

- Record a decrease in deferred corporate income tax expense (the difference between the deferred tax assets arising during the year is greater than the deferred income tax assets reversed during the year);

- Record a decrease in deferred corporate income tax expense (the difference between the deferred income tax payable and reversed during the year is greater than the deferred income tax payable arising during the year);

- Carry forward the difference between the amount arising on the Credit side of account 8212 - "Deferred corporate income tax expense" and the smaller amount arising on the Debit side of account 8212 -

the amount arising on the Credit side of

account 8212 - "Deferred corporate

income tax expense" and the amount

arising on the Debit side of account 8212

- "Deferred corporate income tax

expense" arising in period to the Credit

side of account 911 - "Determining

business results"

"Deferred corporate income tax expense" arising in the period Go to the debit side of account 911 - "Determination of business results"

There is no ending balance

In addition, in the process of accounting for corporate income tax, related account

groups are also used such as: Accounts reflecting revenue, costs, profits and determining business results,

1.2.3.2 Tax base of assets and liabilities

Tax base of assets:

According to VAS 17, “The tax base of an asset is the amount that will be deductible for income tax purposes, deducted from the economic benefits that the enterprise will receive and which are subject to income tax when the carrying amount of the account is recovered If these economic benefits, when received, are not subject to income tax, the tax base of that asset is equal to its carrying amount.”

In the accounting system of Vietnam, assets include seven main categories: cash, financial investments, receivables, inventories, other current assets, fixed assets, and other long-term assets In this system, the guidance for VAS 17 divides these items into assets arising from transactions affecting income or expenses to determine the annual business results at the time of the transaction and assets arising from transactions that do not affect income or expenses to determine the annual business results at the time of the transaction For example, in the case of receivables, the asset item arising from transactions generating taxable income for the enterprise is based on the taxable income value when that asset is recovered In other words, the tax base of a receivable is equal to its carrying amount, as the corresponding revenue upon the occurrence of this item has already been recorded and accounted

for as taxable income upon occurrence For assets arising from transactions where the income from such transactions is not taxable, such as receivables from dividends, and profits that have been subject to withholding tax, their tax base is determined based on the amount of income deducted from taxable income, which is the carrying amount of the asset

Assets arising from transactions that do not affect income or expenses for determining the business results at the time of occurrence also include two types: assets arising from transactions that affect income when the asset is recovered, and assets arising from transactions that do not affect the income or expenses of the enterprise Inventory items, fixed assets, and financial investments are assets arising from transactions that do not affect income or expenses at the time of occurrence but affect these indicators when the asset is recovered The tax base of these assets

is determined based on future expenses when sold or depreciated Assets of the remaining type have a tax base equal to their carrying amount

Tax base of liabilities:

The tax base of a liability is its carrying amount minus the amount deductible for income tax purposes in future periods In the case of unearned revenue, the tax base

of the liability is its carrying amount minus the portion of the revenue that will be recognized but not subject to income tax in the future For example, in the case of

"Interest Received in Advance," where the corresponding interest income is subject

to income tax on an accrual basis, the deductible amount for income tax purposes is equal to the current carrying amount of the item Therefore, the tax base of this liability item is zero

1.2.3.3 Temporary differences

According to VAS 17, "Temporary Differences" are the differences between the carrying amount of asset or liability items in the balance sheet and the tax base of these items Temporary differences include two types: taxable temporary differences and deductible temporary differences

Taxable temporary differences are "temporary differences that result in taxable income in the future when the carrying amount of the related asset or liability is recovered or settled." It's evident that many items can give rise to this type of

difference since taxable income will be recognized in the future when the carrying amount of the balance sheet items is recovered or settled This means that at present, the business will temporarily owe corporate income tax on this temporary difference For example, a company might use a depreciation rate lower than what the tax authority requires As a result, in the future, when determining taxable income for the final depreciation years of the fixed asset, the company will incur additional taxable income

Deductible temporary differences are "temporary differences that result in amounts deductible when determining future taxable income when the carrying amount of the related asset or liability is recovered or settled." For instance, if the company depreciates assets faster than the rate set by the tax authority, when calculating future taxable income, the company will have an amount deductible from accounting profit to reduce the corporate income tax payable

To facilitate the determination of temporary differences in corporate income tax accounting, the guidance for VAS 17 refers to the concept of "Permanent Differences." However, according to Circular 200/2014/TT-BTC, which provides guidance on the corporate accounting regime issued on December 22, 2014, the concept of "Permanent Differences" is no longer used to differentiate from temporary differences when determining deferred income tax

1.2.3.4 Recognition of corporate income tax

Recognition of “Current corporate income tax expense”

"Current corporate income tax expense is the corporate income tax payable based

on the taxable income for the year and the current corporate income tax rate" (according to Circular 200/2014/TT-BTC)

Some concepts related to the determination of “Current corporate income tax expense”:

Definition of “Taxable income” and “Accounting profit”

According to VAS 17:

Accounting profit: "Accounting profit or loss for a period before deducting corporate income tax, determined according to the provisions of accounting standards and the accounting regime." Thus, accounting profit largely depends on

the accounting policies that a business chooses, which align with the accounting standards and the accounting regime, such as: depreciation policy; asset allocation policy; revenue recognition policy; cost accumulation and pricing policy, etc These policies must be detailed in the Notes to the Financial Statements

Taxable income: "Taxable income for a period, determined according to the current Corporate Income Tax Law, and is the basis for calculating the corporate income tax payable (or recoverable)."

The purpose of determining accounting profit is to measure the business performance as accurately as possible based on accepted accounting principles Taxable income, on the other hand, is a legal concept established according to the law and subject to government changes When establishing rules for determining taxable income, the state considers not only contributions to the budget but also achieving public policy objectives As accounting profit and taxable income are determined for different implicit purposes, they often differ in amount The discrepancy between taxable income and accounting profit may result from special tax provisions unrelated to accounting principles For example, some accounting profits are not taxed, such as interest income from joint ventures; or provisions, such as provisions for warranty costs or accrued vacation pay, that are recognized according to accounting standards and policies but are not immediately accepted by tax authorities in the period they are accrued

Determining taxable income depends not only on the tax system and the specific tax base of each country but also on the relationship between the tax law system and the accounting regulations When accounting profit is determined, accountants adjust according to tax law to derive taxable income and account for the differences between "Accounting Profit" and "Taxable Income" per the standards and regulations for corporate income tax accounting

The synthetic accounting method for revenue and expenses to determine pre-tax accounting profit (Appendix 01)

Recognition of “Current Corporate Income Tax Expense”

Quarterly, accountants determine and record the estimated corporate income tax payable for the quarter The estimated quarterly corporate income tax is included in

the current corporate income tax expense for that quarter

At the end of the financial year, accountants must determine and record the actual corporate income tax payable for the year based on the annual taxable income and the current corporate income tax rate The actual corporate income tax payable for the year is recorded as the current corporate income tax expense in the income statement for that year

If the estimated corporate income tax payable for the year exceeds the actual tax payable, the difference between the overestimated tax and the actual tax payable is deducted from the current corporate income tax expense and offset against the corporate income tax payable

If an immaterial error related to corporate income tax from previous years is discovered, the business may account for an increase (or decrease) in the corporate income tax payable for previous years as an adjustment to the current corporate income tax expense in the year the error is discovered

Recognition of “Deferred corporate income tax expense”

Some concepts related to the determination of “Deferred corporate income tax expense”

According to Circular 200/2014/TT-BTC:

Deferred corporate income tax expense: This is the corporate income tax payable in

the future arising from:

- Recognizing deferred tax liabilities during the year;

- Reversing previously recognized deferred tax assets from prior years

Deferred corporate income tax income: This is an offset to deferred corporate

income tax expense arising from:

- Recognizing deferred tax assets during the year;

- Reversing previously recognized deferred tax liabilities from prior years

Approaches to deferred corporate income tax

Different approaches to deferred corporate income tax yield varied outcomes regarding the tax figures presented in financial statements Three proposed approaches to deferred corporate income tax are the deferred method, the asset-liability method, and the net tax method

Deferred method

Under the deferred method, deferred corporate income tax figures are calculated based on the effective tax rate when the temporary difference arises The deferred corporate income tax balance is not adjusted to reflect subsequent changes in tax rates or the application of new tax laws Consequently, the deferred corporate income tax balance does not accurately reflect the amount of corporate income tax payable or receivable in the periods when the temporary difference is reversed This approach aligns with the income statement perspective and emphasizes matching revenues and expenses

Asset-liability method (liability method)

Under the asset-liability method, deferred corporate income tax figures are calculated based on the anticipated effective tax rate in the periods when the temporary difference is reversed According to this method, deferred corporate income tax is considered a liability for the taxes payable or an asset for the amounts deductible for tax purposes in the future This method adopts the balance sheet perspective and emphasizes the usefulness of financial statements in evaluating financial positions and predicting future cash flows

Net tax method

Under this method, no deferred corporate income tax is presented on the balance sheet The corporate income tax expense reported on the income statement corresponds to the actual current income tax payable The tax effects of temporary differences (as per the deferred or asset-liability methods) are not reported separately but are included as adjustments to the balances of specific assets and liabilities related to the associated revenues and expenses This viewpoint argues that taxes payable or deductible in the future are key factors affecting the valuation

of individual assets or liabilities

Recognition of “Deferred Income Tax Liabilities”

- At the end of the financial year, businesses must determine and recognize

"Deferred Income Tax Liabilities" (if any) in accordance with Accounting Standard

No 17 "Corporate Income Tax.”

- Deferred Income Tax Liabilities represent the future corporate income tax

payable on temporary differences taxable in the current year, calculated using the

following formula:

In cases where, at the time of recognizing deferred income tax liabilities, there is a

known change in the corporate income tax rate for the future, and if the reversal of

deferred income tax liabilities falls within the period of the new effective tax rate,

the rate used to recognize deferred income tax liabilities is calculated based on the

new rate

Recognition of deferred income tax liabilities during the year is performed by

offsetting the deferred income tax liabilities arising during the year against the

deferred income tax liabilities recorded from previous years but reversed in the

current year, specifically as follows:

If the deferred income tax liabilities arising during the year exceed the deferred

income tax liabilities reversed during the year, the difference between the deferred

income tax liabilities arising and the amount reversed during the year is added to the

deferred income tax liabilities and increases the deferred corporate income tax

expense

If the deferred income tax liabilities arising during the year are less than the

deferred income tax liabilities reversed during the year, the difference between the

deferred income tax liabilities arising and the amount reversed during the year

reduces the deferred income tax liabilities and decreases the deferred corporate

income tax expense

- Deferred income tax liabilities arising in the current year are recognized as

deferred corporate income tax expenses to determine the business results for that

year, except when the deferred income tax liabilities arise from transactions

recognized directly in equity

- In cases where deferred income tax liabilities arise from the retrospective

application of a change in accounting policy or the correction of material errors

from previous years, leading to taxable temporary differences, accountants should

recognize the additional deferred income tax liabilities for prior years by adjusting the opening balance of account 421 - Retained Earnings (account 4211 - Retained Earnings from Previous Years) and the opening balance of account 347 - Deferred Income Tax Liabilities

Recognition of “Deferred Tax Assets”

- At the end of the financial year, businesses must determine and recognize

"Deferred Tax Assets" (if any) in accordance with Accounting Standard No 17

"Corporate Income Tax."

- Deferred Tax Assets represent the corporate income tax that will be refunded in the future, calculated based on deductible temporary differences and deductible amounts carried forward from tax losses and unused tax credits, according to the formula:

Deferred

tax assets = (

Total deductible temporary difference arising during the

year

+

Deductible value carried forward to the next year of unused tax losses and incentives

) x

Current corporate income tax rate

If, at the time of recognizing deferred tax assets, there is a known change in the corporate income tax rate for the future, and if the reversal of deferred tax assets falls within the period of the new effective tax rate, the rate used to recognize deferred tax assets should be based on the new rate

- Businesses should only recognize deferred tax assets on deductible temporary differences, tax losses, and unused tax credits if it is probable that sufficient taxable profits will be available in the future, as per Accounting Standard No 17

"Corporate Income Tax," to utilize these deductible temporary differences, tax losses, and unused tax credits

- Recognition of deferred tax assets during the year follows the principle of offsetting between deferred tax assets arising during the year and deferred tax assets recorded from prior years but reversed in the current year, specifically as follows:

If deferred tax assets arising during the year exceed the deferred tax assets reversed during the year, the accountant should recognize additional deferred tax assets for

the difference, provided that it is probable the business will have sufficient taxable profits in the future to recover the deferred tax assets recognized in the current year

If the business is not certain of future taxable profits, the accountant should not recognize deferred tax assets for the deductible temporary differences arising during the year

If deferred tax assets recognized during the year are less than the deferred tax assets reversed during the year, the accountant should decrease the deferred tax assets by the difference The reduction of deferred tax assets should align with the reversal timing of the deductible temporary differences (arising from prior years), even if the business does not have taxable profits

- If the business has tax losses and unused tax credits and it is probable that sufficient taxable profits will be available in the future to offset the tax losses and utilize the tax credits, the accountant should recognize deferred tax assets equal to the deductible amount carried forward from those items, multiplied by the current corporate income tax rate

- If deferred tax assets arise from the retrospective application of a change in accounting policy or the correction of material errors from previous years, leading

to deductible temporary differences, the accountant should adjust the opening balance of account 421 – Retained Earnings (Account 4211 – Retained Earnings from Previous Years) and adjust the opening balance of account 243 – Deferred Tax Assets

1.2.3.5 Procedure for corporate income tax accounting

“Current corporate income tax expense” accounting

Based on the relevant documents, the accountant records the current corporate income tax expense incurred according to the following diagram:

Chart 1.1: Current corporate income tax expense accounting

(1) Recording the amount of corporate income tax paid by the business to the state budget

(2) Quarterly, when determining the provisional corporate income tax payable according to the Corporate Income Tax Law

(3) Increasing current corporate income tax expense in cases where the actual corporate income tax payable determined at year-end is greater than the provisional tax paid quarterly during the year

(4) Recording the difference when the provisional corporate income tax paid quarterly during the year is greater than the actual tax payable, as well as the tax reductions and exemptions

(5) Transferring the current corporate income tax expense

2.3.3.2 “Deferred corporate income tax expense” accounting

Based on the relevant documents related to deferred corporate income tax, the accountant records the arising economic transactions according to the following diagram:

Chart 1.2: “Deferred corporate income tax” accounting

1a) The difference when the deferred corporate income tax liability arising during the year is greater than the deferred corporate income tax liability reversed during the year

1b) The difference when the deferred corporate income tax liability arising during the year is less than the deferred corporate income tax liability reversed during the year

2a) The difference when the deferred tax asset arising during the year is less than the deferred tax asset reversed during the year

2b) The difference when the deferred tax asset arising during the year is greater than the deferred tax asset reversed during the year

3a) Transferring the credit balance difference greater than the debit balance of account 8212

3b) Transferring the credit balance difference less than the debit balance of account

8212

1.2.3.6 Reports related to corporate income tax accounting

In order for tax authorities to be able to manage and evaluate the operational and financial situation and evaluate the compliance with the law of tax paying units, the

state has set regulations that tax paying units are obliged to provide tax authorities with periodic tax reports according to the provisions of the Tax Law and financial reports according to the provisions of the Accounting Law

Financial reports:

Businesses must prepare financial statements in accordance with the current accounting regime The objective of financial statements is to reflect the economic impacts of transactions and events on the financial condition and operational performance of the business Commonly used financial statements include:

- Statement of financial position: Balance sheet

- Statements reflecting changes over a period: Income statement, cash flow

statement

- Notes to the financial statements

Present information related to corporate income tax on financial statements

Present on Balance sheet

The indicators for Corporate Income Tax include:

(1) "Deferred Income Tax Assets": The figure to be recorded in this indicator is based on the debit balance of Account 243 "Deferred Income Tax Assets" on the General Ledger

(2) "Deferred Income Tax Liabilities": The figure to be recorded in this indicator is based on the credit balance of Account 347 "Deferred Income Tax Liabilities" on the General Ledger

(3) "Taxes and Receivables from the Government": This indicator reflects taxes and other overpaid amounts to the Government at the reporting date The figure to

be recorded in the "Taxes and Receivables from the Government" indicator is based

on the detailed debit balance of Account 333 "Taxes and Payables to the Government" on the detailed accounting ledger of Account 333

(4) "Taxes and Payables to the Government": This indicator reflects the total amounts that the enterprise owes to the Government at the reporting date, including taxes, fees, charges, and other payables The figure to be recorded in this indicator

is based on the detailed credit balance of Account 333 "Taxes and Payables to the Government"

Presentation in the Statement of Income:

- Indicator "Current Corporate Income Tax Expense": This indicator reflects the current corporate income tax expense incurred during the reporting year The figure

to be recorded in this indicator is based on the total credit amount of Account 8211

"Current Corporate Income Tax Expense," offset against the debit side of Account

911 "Determination of Business Results" on the detailed accounting ledger of Account 8211 Alternatively, it may be based on the debit amount of Account 8211 offset against the credit side of Account 911 during the reporting period on the detailed accounting ledger of Account 8211 In this case, the figure should be recorded as a negative value in parentheses (…)

- Indicator "Deferred Corporate Income Tax Expense" This indicator reflects the deferred corporate income tax expense or deferred corporate income tax income incurred during the reporting year The figure to be recorded in this indicator is based on the total credit amount of Account 8212 "Deferred Corporate Income Tax Expense," offset against the debit side of Account 911 "Determination of Business Results" on the detailed accounting ledger of Account 8212 Alternatively, it may

be based on the debit amount of Account 8212 offset against the credit side of Account 911 during the reporting period on the detailed accounting ledger of Account 8212 In this case, the figure should be recorded as a negative value in parentheses (…)

Presentation in the Notes to the Financial Statements

In the notes to the financial statements, for the indicator "Deferred Income Tax Assets," the enterprise should provide explanations concerning elements related to deductible temporary differences, tax losses, and unused tax incentives, as well as the reversal recorded from previous years For the indicator "Deferred Income Tax Liabilities," explanations should cover matters such as those arising from taxable temporary differences, the reversal recorded from previous years, and the deferred income tax liabilities

The enterprise should explain the corporate income tax expenses, including:

"Current Corporate Income Tax Expense," with details on the current year's taxable corporate income tax expense, adjustments to corporate income tax expense from