While German Tax Computations Are Based on Financial Accounting Standards

question 62

Multiple Choice

While German tax computations are based on financial accounting standards, this is not true in the United Kingdom.Why doesn't the U.K.base its tax code on financial accounting standards?

• A)The United Kingdom tries to avoid being like Germany whenever it can.
• B)The United Kingdom had a tax code long before it had financial accounting standards.
• C)Financial accounting standards in the United Kingdom are too conservative to be practical for tax purposes.
• D)Germany follows the directives of the European Union, whereas the United Kingdom has not adopted the directives of the EU.

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Definitions:

Federal Reserve

The primary banking authority in the United States, tasked with overseeing monetary policy, regulating banks, and providing financial services.

Central Bank

A national financial institution that provides financial and banking services for its country’s government and commercial banking system, and implements the government’s monetary policy.

Regulating Banks

The process of establishing and enforcing rules and standards that govern the banking industry to ensure stability and protect consumers.

Banking System

The banking system consists of a network of banks and financial institutions that provide financial services, including managing deposits, lending, and currency exchange.