What is the criteria for the recognition of a deferred tax asset (DTA) associated with a tax loss?

Question

Quizplus · Accepted Answer

According to AASB 112, a deferred tax asset associated with a tax loss is recognized if it is probable that there will be sufficient future taxable profits against which to offset the loss. "Probable" in this context means that there is a likelihood greater than 50%. Therefore, option A is correct as it aligns with the requirements of AASB 112. Option B is incorrect because certainty cannot be achieved in future events. Option C is incorrect as AASB 112 allows recognition of DTAs for tax losses under certain criteria. Option D is incorrect as it demands a higher degree of certainty than what is required by AASB 112.

What Is the Criteria for the Recognition of a Deferred