Question: Donovan Corp., a calendar-year-end company, operates a profitable division in Jurisdiction A. In January 2014, Jurisdiction A enacted a tax law that changed the tax

Donovan Corp., a calendar-year-end company, operates a profitable division in Jurisdiction A. In January 2014, Jurisdiction A enacted a tax law that changed the tax rate structure from 30 percent to 35 percent. Donovan wants to know whether it needs to adjust its 12/ 31/ 2013 tax provision to reflect the rate change. Also, if not in 2013, when does it need to recognize the effect of that change?

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