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    Assessment

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    sairamsk
    For the 2009-2010 financial year: - Hero Honda recorded deferred tax assets of INR 7.88 crores due to timing differences in accrued expenses. It also recorded deferred tax liabilities of INR 160.63 crores mainly due to differences in depreciation and amortization. - Bajaj Auto, a competitor, recorded deferred tax liabilities of INR 191.8 crores. It recorded significantly higher deferred tax assets of INR 223.9 crores primarily due to differences in voluntary retirement schemes, inventory valuation, investments, provisions, and taxes. - For Bajaj Auto, deferred taxes are accounted for if timing differences between book and taxable profits are reasonably certain to crystallize,

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    Assessment

    Uploaded by

    sairamsk
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    For the 2009-2010 financial year: - Hero Honda recorded deferred tax assets of INR 7.88 crores due to timing differences in accrued expenses. It also recorded deferred tax liabilities of INR 160.63 crores mainly due to differences in depreciation and amortization. - Bajaj Auto, a competitor, recorded deferred tax liabilities of INR 191.8 crores. It recorded significantly higher deferred tax assets of INR 223.9 crores primarily due to differences in voluntary retirement schemes, inventory valuation, investments, provisions, and taxes. - For Bajaj Auto, deferred taxes are accounted for if timing differences between book and taxable profits are reasonably certain to crystallize,

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    For the 2009-2010 financial year: - Hero Honda recorded deferred tax assets of INR 7.88 crores due to timing differences in accrued expenses. It also recorded deferred tax liabilities of INR 160.63 crores mainly due to differences in depreciation and amortization. - Bajaj Auto, a competitor, recorded deferred tax liabilities of INR 191.8 crores. It recorded significantly higher deferred tax assets of INR 223.9 crores primarily due to differences in voluntary retirement schemes, inventory valuation, investments, provisions, and taxes. - For Bajaj Auto, deferred taxes are accounted for if timing differences between book and taxable profits are reasonably certain to crystallize,

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    13 views1 page

    Assessment

    Uploaded by

    sairamsk
    For the 2009-2010 financial year: - Hero Honda recorded deferred tax assets of INR 7.88 crores due to timing differences in accrued expenses. It also recorded deferred tax liabilities of INR 160.63 crores mainly due to differences in depreciation and amortization. - Bajaj Auto, a competitor, recorded deferred tax liabilities of INR 191.8 crores. It recorded significantly higher deferred tax assets of INR 223.9 crores primarily due to differences in voluntary retirement schemes, inventory valuation, investments, provisions, and taxes. - For Bajaj Auto, deferred taxes are accounted for if timing differences between book and taxable profits are reasonably certain to crystallize,

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    For the financial year 2009-2010, it has been noted that Hero Honda recorded Deferred Tax Assets

    (DTA) worth INR 7.88 crores. This is on account of timing differences in accrued expenses that are deductible on payment. The company also recorded Deferred Tax Liabilities (DTL) worth INR 160.63 crores. This is mainly on account of timing difference in depreciation and amoritisation.

    Its competitor, Bajaj Auto Limited, recorded a comparable figure for DTL (for financial year 2009-2010) at INR 191.8 crores. However, it recorded a significantly high figure for DTA, at INR 223.9 crores. This is mainly on account of differences in: Voluntary Retirement Scheme costs Inventory valuation Diminution in the value of investments Provision for bad and doubtful debts Provision for decrease in value of investments Provision for privilege leave etc. Taxes, duties etc. Amortisation of premium / discount on acquisition of fixed income securities Adjustments on account of gratuity provisions

    Assessment For Hero Hondas competitor, Bajaj Auto Limited, deferred taxes resulting from timing difference between book profits and taxable profits are accounted for to the extent deferred tax assets and liabilities are expected to crystallize with reasonable certainty. Also, deferred tax assets are recognized if there is virtual certainty that there would be adequate future taxable income against which such deferred tax assets can be realized. Deferred tax is recognized on adjustments to revenue reserves to the extent the adjustments are allowable as deductions in determination of taxable income and they would reverse out in future periods.

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