FRED 68 deals with donations by trading subsidiaries to charitable parent entities.
For some time now we’ve been told that such payments should be accounted for as distributions. OK - I get the point. But FRED 68 introduces the idea that the donor should recognise in its accounts the tax effects of a donation that will “probably” be made in the following nine months.
So - for periods beginning on or after 1 January 2019 - donors must now recognise the tax effects of the donation in one period, even though the donation itself may not be not recognised until the following period (if indeed the donation is ultimately paid at all).
Such outmoded concepts as prudence and matching seem to have had little influence on the Draft.
Do any of my fellow professionals think the new requirements are rather... odd, to put it mildly?