Answer to Question #238518 in Economics for Vee

Question

Interim Financial reporting IAS 34 is an old standard that has been in operation for a long time.It is one of the easiest standards to understand. The owner Director of Big Mama Ltd has however no understanding

Big Mama is a manufacturing entity with a 31 December year end The entity had an assessed

loss of N$200 000 for the year ended 31 December 2020. No deferred tax asset has been

recognized for the loss. Big Mama reports on 30 June 2021 on the interim results for the 6 months

then ended. For the first 6 months of the 2020 financial year the company earned N$500 000 and

expects to earn N$600 000 in the remaining 6 months. Assume a tax rate of 32% is applicable in

the Namibian jurisdiction in which Big Mama operates.

3.1 Prepare a Memo to the Director explaining to him the key tax implications of

IAS 34: Interim Financial reporting. In the Memo Calculate the income tax expense to be reported in the interim report for the six Months ended 30 June 2021 in compliance with IAS 34.

Answer 1

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