(USA) is a 120-year-old international gold mining company with substantial gold mining operations and exploration in the United States, Canada, and Australia. At year-end, Homestake reported the following items related to income taxes (thousands of dollars).

Total current taxes ......................................................................................... $ 26,349
Total deferred taxes ........................................................................................ (39,436)
Total income and mining taxes (the provision for taxes per its
income statement) .......................................................................................... (13,087)
Deferred tax liabilities ................................................................................. $303,050
Deferred tax assets, net of an unrecognized amount of $207,175 .......... 95,275
Net deferred tax liability .............................................................................. $207,775
Note 6 (partial):
Tax loss carryforwards (U.S., Canada, Australia, and Chile) ....................... $71,151
Tax credit carryforwards ................................................................................. $12,007

Instructions

a. What is the significance of Homestake’s disclosure of “Current taxes” of $26,349 and “Deferred taxes” of $(39,436)?

b. Explain the concept behind Homestake’s disclosure of deferred tax liabilities (future taxable amounts) and deferred tax assets future deductible amounts.

c. Homestake reported tax loss carryforwards of $71,151 and tax credit carryforwards of $12,007. How does the carryforward provision affect the reporting of deferred tax assets and deferred tax liabilities?