A Large Public Company Reported That Its Provision for Income

question 54

Essay

A large public company reported that its provision for income taxes was $500 million and that it has a deferred tax liability of 2 billion. A Member of Parliament calls you and says, "I see hundreds of companies who have these huge deferred tax liabilities on their balance sheets. If the government could get even half of what's owed, it could cut the public deficit down to size in a hurry."
Required:
Write a memo to the Member of Parliament explaining the issues.

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Definitions:

Affective Component

This component refers to the emotional or feeling segment of an attitude or psychological state, influencing mood and emotional responses.

Proud

Feeling deep satisfaction or pleasure from one's own achievements, the achievements of those one is closely associated with, or from qualities or possessions that are widely admired.

Provincial Capital

The city designated as the administrative capital or seat of government of a province.

Persuasion

The process of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through communication.