Part 4: Understand How the Tax Provision Results Impact Financial Documents (Currently Unavailable)

Author: Shamen Dugger

This course addresses the impacts of the tax provision adjusting journal entries on the general ledger, trial balance, and financial statements. Internal controls also are evaluated in terms of mitigating tax provision risk relative to the financial statements.

Publication Date: June 2014

Designed For
New Hires in Public Accounting and Industry, Experienced Hires Outside of Core Tax Compliance, Accounting and Finance Students (College and Masters Level) and Taxation Students (JD and LLM Levels).

Topics Covered

• Tax Adjusting Journal Entries
• General Ledger
• Trial Balance
• Financial Statements
• Internal Controls

Learning Objectives

• Recognize how the tax provision adjusting journal entry impacts the general ledger, trial balance, and financial statements
• Identify the interplay between the income statement and the balance sheet from a tax provision perspective
• Describe which tax accounts are zeroed out at year end and which tax accounts carry over
• Identify what the general ledger houses
• Recognize which financial documents are used to record tax adjusting journal entries
• Describe what should be used within the general ledger to reflect the tax adjusting journal entries
• Identify which accounts are zeroed and not zeroed out at year end
• Recognize where to find the provision for income taxes on the financial statement
• Identify which basic formulae reflect the balance sheet
• Recognize which document to use to prepare the trial balance
• Differentiate which act covers internal control
• Describe the two layers of internal controls relative to the tax provision
• Identify why the tax provision is ripe for risk
• Differentiate statements regarding SOX 404 internal controls
• Recognize what the SOX 404 acronym stands for
• Identify what helps mitigate tax provision risk of material weakness
• Describe the levels of tax provision review recommended before submission to the company/audit firm
• Differentiate if companies should concern themselves with internal controls
• Recognize tax provision adjusting journal entries
• Identify acceptable tax adjusting journal entry general ledger descriptions
• Evaluate what internal controls are instituted to reduce
• Recognize if total general ledger debits and credits tie
• Recognize if total trial balances debits and credits tie
• Identify if the trial balance is organized to reflect the financial statements
• Differentiate if balance sheet accounts are holding accounts
• Recognize if a tax benefit increases net income
• Recognize if a tax expense decreases net income
• Identify where net income ultimately absorbs within owner's equity
• Describe what federal corporate income tax return schedule reconciles book income of taxable income

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
None

Advance Preparation
None