Looking for help in reporting an R&D tax credit prior year adjustment under FRS102.
Do you have to provide a note to the accounts to explain the prior year adjustment to the corporation tax charge ?
Replies (2)
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Corporation Tax provision is an accounting estimate.
FRS 102 10.18 says that:
An entity shall disclose the nature of any change in an accounting estimate and the effect of the change on assets, liabilities, income and expense for the current period.
10.15 says:
Changes in accounting estimates result from new information or new developments and, accordingly, are not corrections of errors.
So it's not a prior year adjustment and you should not restate prior year comparatives.