Any sized business can attest that ensuring their income tax accounting is in compliance with Accounting Standard Codification 740 – previously FAS 109 – is a bit like trying to walk on a highwire; it’s a complex balancing act when trying to calculate the effective tax rate using the current rules.

Taking Stock of Stock Compensation
This might be a simple calculation process if it only required an analysis of the traditional book/tax differences. However, thanks to Accounting for Stock Compensation under ASC 718 and Uncertain Tax Position under ASC 740-10, an extra level of complexity has been added to the process. This in itself is overwhelming for most enterprises. But there are other items to consider, such as international, multi-state, and business combination issues.

SEC Restrictions
The SEC has drawn a clear boundary line; it does not permit accounting firms to provide tax provision services to clients for whom they provide audit services. This restriction creates additional challenges to companies whose employees report income taxes in adherence with ASC 740.

Astute’s Solution
The experts at Astute realize that this is not a viable option for most companies, which is why many are turning to us for assistance; we have a deep technical understanding of reporting under ASC 740. Further, we have a rich history of working with our clients’ external auditors. Entrust your income tax reporting to our professionals, and use the free time to achieve your business objectives.


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