ESMA Sets out Expectations Regarding Application of IAS 12 and the Recognition of Deferred Tax Assets

The European Securities and Market Authority (‘ESMA’) has published a public statement on its expectations regarding the application of the requirements relating to the recognition, measurement and disclosure of deferred tax assets arising from unused tax losses in IFRS financial statements.

The public statement arises from findings and discussions of the European Enforcers Coordination Sessions (‘EECS’), where several cases highlighted significant divergence in the application and enforcement of the requirements relating to recognition of deferred tax assets.

The full public statement can be accessed here.