KPMG report: Tax reform, accounting for income taxes

KPMG LLP has prepared a report providing preliminary guidance of the financial reporting implications under U.S. GAAP of H.R. 1, originally known as the “Tax Cuts and Jobs Act.” The tax reform was enacted on December 22, 2017, and is expected to significantly affect companies’ accounting for and reporting of income taxes, and the related processes and controls.

Because ASC 740 requires companies to recognize the effect of tax law changes in the period of enactment, the effects must be recognized in companies’ December 2017 financial statements—even though the effective date for most provisions is January 1, 2018.

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