Sales and Use Tax Reserves: Financial Accounting Standards Under ASC 450 and IAS 37

Under the terms of Accounting Standards Codification (ASC) 450 and International Accounting Standards (IAS) 37, the requirements have never been more intense for determining reserves for uncertain sales and use tax positions. Tax professionals must prepare for enforcement scrutiny with practical strategies and best practices for setting reserves.

Both ASC 450 and IAS 37 require companies to accrue for uncertain loss reserves, make disclosure of significant changes in estimates, and provide "early warning" disclosure for possible losses.

As the national economy continues to evolve, the pressure on companies to properly manage sales and use taxes globally must be balanced against the impact on the business' financials.

Listen as our panel of experienced sales tax advisers share their insights and current best practices for creating prudent reserves to account for uncertain sales or use tax positions.

1. Identifying tax uncertainties and initial decisions about a sales and use tax reserve
2. The role of ASC 450 and IAS 37 in establishing and measuring a sales tax reserve
   1. Anticipating events that may impair assets or increase liabilities
   2. Audit detection considerations in recognizing a loss contingency
   3. ASC 450 and IAS 37 comparison
3. Planning opportunities to mitigate sales and use tax loss contingencies

The panel will review these and other key issues:

• Reserve-related red flags in audit disclosures and financial statements
• Financial accounting standards under ASC 450 and IAS 37
• Audit detection considerations in recognizing a loss contingency

Learning Objectives

After completing this seminar, you will be able to:

• Identify uncertain sales and use tax positions
• Determine the impact of ASC 450 on setting a sales tax reserve
• Recognize events that may impair assets or increase liabilities
• Ascertain differences in ASC 450 and IAS 37

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Specific knowledge and understanding of setting reserves for uncertain company sales and use tax positions using the most current interpretations of ASC 450(fka FAS 5) and IAS 37 under IFRS reporting requirements.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.