For the Year Ended October 31,2018,NB Financial Group (National Bank)reported

question 22

Essay

For the year ended October 31,2018,NB Financial Group (National Bank)reported income before tax of $2,160 million and income tax expense of $274 million,for an effective tax rate of 12.7% ($274m / $2,160m).In the notes to the financial statements,NB's disclosures included the following information:

Required:
a.From NB's disclosures provided above,identify any permanent differences.
b.In which direction did the tax rate change from 2017 to 2018?
c.Refer to the line "Recovery of prior years' income taxes" in the above disclosures.What does this information imply about NB's treatment of tax losses in prior years?

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Definitions:

Lie Scale

A tool used in questionnaires and psychological tests that helps to identify when respondents are not answering truthfully by measuring the tendency to give socially desirable responses.

White Lie

A harmless or small lie told to avoid hurting someone's feelings or for benevolent reasons.

Personal Pronouns

Words used to replace names in sentences, typically referring to people, such as he, she, they, it.

Text Messaging

A method of sending short written messages between mobile devices.