The president of Cardassia has recently been doing some recreational reading and came across an article on the adoption of FASB Statement No.109 in the United States. The president liked the article so much that she has decided to adopt Statement No.109 as the standard for deferred tax accounting in Cardassia.
You have been hired as the government minister in charge of accounting, taxation, and nuclear waste disposal for the country of Cardassia. It is your duty to figure out how to implement Statement No.109.You note that the accounting rules and tax code in Cardassia are very similar to those in the United States except that Cardassian income tax law does not allow the carryback or carryforward of net operating losses.
How will this difference in Cardassian tax law affect the accounting for deferred tax liabilities? deferred tax assets?