Tax Reform: How to Cover in Your MD&A

Brink Dickerson of Troutman Sanders sent in these thoughts about tax reform & MD&A: The corporate tax rate change will have three primary impacts on MD&A drafting: – Prospectively, the impact of the lower rate. This is a “known trend or uncertainty” that needs to be discussed even where a company does not typically address future tax rates in its SEC filings. – Historically, the impact of the change in the tax rate change on tax assets and liabilities, which will show up in the year-end financial statements. – Prospectively, changes in repatriation plans, which again is “known trend or uncertainty.” Brink expects non-GAAP disclosure regarding both. And he also expects that the amounts likely will be self-reconciling. For example, he would expect to see statements such as: Our tax expense for 2017 was $ _million. This amount reflects a reduction in our Deferred Tax Asset of $_million as a result of a decrease in the value…

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