European Financial and Accounting Journal 2010, 5(1):6-27 | DOI: 10.18267/j.efaj.42

Impact of IAS 12 on Deferred Taxes Regulation in the Czech Republic.

Marcela Žárová
Doc. Ing. Marcela Žárová, CSc. - Associate professor; Department of Financial Accounting and Auditing, Faculty of Finance and Accounting, University of Economics, Prague, W. Churchill Sq. 4, 130 67 Prague 3, Czech Republic; <zarova@vse.cz>.

This article investigates the impact of IAS 12 on deferred taxes regulation in the Czech Republic, where local accounting regulations includes accounting standards only by names, but not as an output of regular due process and which are not issued by the professional accounting body at all, not even partially. The article deals with the development and description of the Czech accounting system from early nineties of last century till present time as a background for IFRS implementation. Then the article followed subsequent steps of IAS 12 implementation into the hierarchy of legal rules for accounting, starting with the Act on accounting, decree on business entities and Czech accounting standard for deferred taxes. IAS 12 implementation into Czech accounting system is an example of partial and incomplete implementation of IFRS into domestic accounting rules based on different law presumption than under which are IFRS developed. Example of IAS 12 implementation into Czech accounting regulatory system, provide the reader clear demonstration of wrong philosophy how to reach comparable accounting information. Based on the published criticism, the recommendation is not to continue in partial IFRS implementation but make good rule for entities to allow them to choose either full IFRS or domestic rules applicable in compliance with the approach "think small first".

Keywords: Deferred tax, IAS 12, IFRS implementation
JEL classification: M41

Published: March 1, 2010  Show citation

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Žárová, M. (2010). Impact of IAS 12 on Deferred Taxes Regulation in the Czech Republic. European Financial and Accounting Journal, 5(1), 6-27. doi: 10.18267/j.efaj.42
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